Joint Tenancy or Tenancy in Common?
1. Introduction
The anfractuosities of the common law occasionally come back to haunt us. That is especially true of the law of property. Most of us know the difference between a joint tenancy and a tenancy in common. But it is not always clear whether a grantor or testator created one or the other. The issue arose in the recent case, Clements v Everson.[1]
2. Facts
John and Mildred Clements had seven children, including Yvonne and Katherine. In 2000 John and Mildred purchased a country property called Thorah. In 2001 they transferred title to themselves and Yvonne and Katherine as joint tenants. In 2004 the four entered into a trust agreement, under which Yvonne and Katherine became trustees of Thorah and held their one-half interest in trust for their parents, who remained beneficial owners. But Yvonne and Katherine’s interest was registered to them as joint tenants. The agreement provided that if either parent predeceased Yvonne and Katherine, the surviving parent remained the beneficial owner of Thorah. Mildred died in 2007, and John, Yvonne, and Katherine were then listed as joint tenants.
John died in 2016. His Will devised Thorah to Yvonne and Katherine for their own use absolutely. But it went on to say that either Yvonne or Katherine was entitled to acquire the interest of the other in the property. Finally, the will provided that if both Yvonne and Katherine predeceased their father, the property would fall into the residue of his estate.
There were two dwellings on Thorah and Yvonne and Katherine each lived in their own dwelling. Yvonne relied on Katherine for her water supply. Katherine’s house required major renovations that she could not afford, so she and Yvonne got a joint line of credit to pay for the renovations. It was secured against Thorah. Katherine died in 2021, and Yvonne has been responsible for the payments on the line of credit since 2023. Katherine’s daughter, Kelly, paid her mother’s share of the carrying costs of Thorah since her mother died.
Yvonne made an assignment in bankruptcy in 2015 and in consequence assigned her interest in Thorah to the trustee in bankruptcy. That severed the joint tenancy and thereafter the trustee and Katherine each held a one-half interest in Thorah as tenants in common. In 2022 Yvonne satisfied her debt and the trustee registered a notice of disclaimer on title to divest itself of title and requested that title be amended to show Yvonne as the owner of the disclaimed half interest. The disclaimer and the amended title abstract did not show whether Yvonne and Katherine’s estate held title as joint tenants or tenants in common.
Yvonne then brought an application for a declaration that the title to Thorah be amended to show her as joint tenant. In the alternative, she sought an order declaring that the respondents, being the three children of Katherine and the executors of her estate, were unjustly enriched.
3. Analysis and Judgment
Justice Casullo noted that while originally, pursuant to the trust agreement, the property would have passed to Yvonne by right of survivorship when Katherine died, when Yvonne made an assignment in bankruptcy the joint tenancy was severed the title was held by the trustee in bankruptcy and Katherine as tenants in common. Although Yvonne was restored to the title, the parcel abstract failed to show the capacity in which Yvonne and Katherine held title.
Her Honour quoted section 13(1) of the Conveyancing and Law of Property Act,[2] which adopted the equitable rule of construction which states that when two or more persons take title to real property, presumptively they take title as tenants in common, unless the letters patent, transfer, or will makes it clear that they are to take as joint tenants. The document that governed the transfer of Thorah to Yvonne and Katherine, namely, John’s will, did not declare the capacity in which the sisters would take title. Nor was there any other evidence to show that they should take as joint tenants. Thus, the presumptive rule of section 13(1) applied to give the sisters title as tenants in common.
On the issue of unjust enrichment and responsibility for the line of credit, Justice Casullo made the sensible decision that a reference was not necessary to determine the respective liabilities of the parties. As she said in para 61, ‘This matter has already consumed more than its fair share of legal fees and judicial resources, not to mention the emotional toll to the parties’. Instead, those liabilities could readily be determined by a couple of spreadsheets detailing the carrying costs of Thorah and the expenditures made from the money borrowed under the line of credit.
Accordingly, Her Honour declared that Yvonne and Katherine acquired ownership to Thorah as tenants in common. Therefore, on Katherine’s death her half interest fell into her estate. Further, she declared that the carrying costs of Thorah should be borne by Yvonne and Katherine’s estate in proportion to their respective contributions. Similarly, satisfaction of the line of credit should be determined based on what portion of the moneys was used by Yvonne and Katherine’s estate.
The costs of the proceeding could not be recovered from an estate, since there isn’t one. Her Honour held that in the circumstances each party should bear their own costs.
—
[1] Clements v. Everson, 2024 ONSC 4885.
[2] RSO 1990, c C.34.
Written by: Albert Oosterhoff
Posted on: April 21, 2025
Categories: Commentary, WEL Newsletter
1. Introduction
The anfractuosities of the common law occasionally come back to haunt us. That is especially true of the law of property. Most of us know the difference between a joint tenancy and a tenancy in common. But it is not always clear whether a grantor or testator created one or the other. The issue arose in the recent case, Clements v Everson.[1]
2. Facts
John and Mildred Clements had seven children, including Yvonne and Katherine. In 2000 John and Mildred purchased a country property called Thorah. In 2001 they transferred title to themselves and Yvonne and Katherine as joint tenants. In 2004 the four entered into a trust agreement, under which Yvonne and Katherine became trustees of Thorah and held their one-half interest in trust for their parents, who remained beneficial owners. But Yvonne and Katherine’s interest was registered to them as joint tenants. The agreement provided that if either parent predeceased Yvonne and Katherine, the surviving parent remained the beneficial owner of Thorah. Mildred died in 2007, and John, Yvonne, and Katherine were then listed as joint tenants.
John died in 2016. His Will devised Thorah to Yvonne and Katherine for their own use absolutely. But it went on to say that either Yvonne or Katherine was entitled to acquire the interest of the other in the property. Finally, the will provided that if both Yvonne and Katherine predeceased their father, the property would fall into the residue of his estate.
There were two dwellings on Thorah and Yvonne and Katherine each lived in their own dwelling. Yvonne relied on Katherine for her water supply. Katherine’s house required major renovations that she could not afford, so she and Yvonne got a joint line of credit to pay for the renovations. It was secured against Thorah. Katherine died in 2021, and Yvonne has been responsible for the payments on the line of credit since 2023. Katherine’s daughter, Kelly, paid her mother’s share of the carrying costs of Thorah since her mother died.
Yvonne made an assignment in bankruptcy in 2015 and in consequence assigned her interest in Thorah to the trustee in bankruptcy. That severed the joint tenancy and thereafter the trustee and Katherine each held a one-half interest in Thorah as tenants in common. In 2022 Yvonne satisfied her debt and the trustee registered a notice of disclaimer on title to divest itself of title and requested that title be amended to show Yvonne as the owner of the disclaimed half interest. The disclaimer and the amended title abstract did not show whether Yvonne and Katherine’s estate held title as joint tenants or tenants in common.
Yvonne then brought an application for a declaration that the title to Thorah be amended to show her as joint tenant. In the alternative, she sought an order declaring that the respondents, being the three children of Katherine and the executors of her estate, were unjustly enriched.
3. Analysis and Judgment
Justice Casullo noted that while originally, pursuant to the trust agreement, the property would have passed to Yvonne by right of survivorship when Katherine died, when Yvonne made an assignment in bankruptcy the joint tenancy was severed the title was held by the trustee in bankruptcy and Katherine as tenants in common. Although Yvonne was restored to the title, the parcel abstract failed to show the capacity in which Yvonne and Katherine held title.
Her Honour quoted section 13(1) of the Conveyancing and Law of Property Act,[2] which adopted the equitable rule of construction which states that when two or more persons take title to real property, presumptively they take title as tenants in common, unless the letters patent, transfer, or will makes it clear that they are to take as joint tenants. The document that governed the transfer of Thorah to Yvonne and Katherine, namely, John’s will, did not declare the capacity in which the sisters would take title. Nor was there any other evidence to show that they should take as joint tenants. Thus, the presumptive rule of section 13(1) applied to give the sisters title as tenants in common.
On the issue of unjust enrichment and responsibility for the line of credit, Justice Casullo made the sensible decision that a reference was not necessary to determine the respective liabilities of the parties. As she said in para 61, ‘This matter has already consumed more than its fair share of legal fees and judicial resources, not to mention the emotional toll to the parties’. Instead, those liabilities could readily be determined by a couple of spreadsheets detailing the carrying costs of Thorah and the expenditures made from the money borrowed under the line of credit.
Accordingly, Her Honour declared that Yvonne and Katherine acquired ownership to Thorah as tenants in common. Therefore, on Katherine’s death her half interest fell into her estate. Further, she declared that the carrying costs of Thorah should be borne by Yvonne and Katherine’s estate in proportion to their respective contributions. Similarly, satisfaction of the line of credit should be determined based on what portion of the moneys was used by Yvonne and Katherine’s estate.
The costs of the proceeding could not be recovered from an estate, since there isn’t one. Her Honour held that in the circumstances each party should bear their own costs.
—
[1] Clements v. Everson, 2024 ONSC 4885.
[2] RSO 1990, c C.34.
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