Can joint tenants hold unequal shares?
Whitman, Dale
The standard common law answer to this question was no. By definition, joint tenants must hold equal interests. If there are two of them, each must hold 50%, and so forth.
However, Eric pointed out a New York case that seems to disagree with that conclusion. It's Novak v. Novak, 135 Misc.2d 909, 516 N.Y.S.2d 878 (Sup. Ct. 1987). In that case, a husband owned a house and conveyed to himself and his fiance' a few days before they were married. Later, when they were divorced, the husband petitioned for partition of the property. In the partition proceeding, the wife claimed that they held equal shares and therefore that she was entitled to half of the proceeds or value of the property. The husband wanted "equitable distribution" instead, presumably because he thought it would give him most or all of the property's value, since he had paid for the house when it was originally purchased. The court held for the husband, refusing to simply split the property down the middle. While it refused to apply the "equitable distribution" provisions of Domestic Relations Law Sec. 236 (since the property was acquired by the husband before the marriage, and therefore Sec. 236 didn't apply), it ended up doing something very similar under Domestic Relations Law Sec.234, and it noted that the result might very well be exactly the same as under the Sec. 236 "equitable distribution" provisions.
In its opinion, the court said:
"The defendant [wife] urges the view that the joint tenancy created an undivided one-half interest in each party, and that such interests are not subject to equitable distribution. Such is not the law. Joint tenancy does not create equality of interests, but rather, the right of survivorship."
I think the result in the case is correct, but the last sentence quoted above is wrong; joint tenancy does indeed create equality of interests. A correct understanding, I think, is this: The parties have equal interests, but under Domestic Relations Law Sec. 234, the court is entitled to make a disposition that differs from a 50-50 split, despite the fact that the parties have a theoretical 50-50 split of interests. Sec.234 provides that the court may "make such direction, between the parties, concerning the possession of property, as in the court's discretion justice requires having regard to the circumstances of the case and of the respective parties." And Sec. 234 applies whether the property was acquired before the marriage or afterward.
In other words, the division of proceeds in a partition action incident to a divorce does not have to agree precisely with the parties' ownership interests in the property.
This isn't an idea unique to New York. In Spector v. Giunta, 62 Ohio App.2d 137, 405 N.E.2d 327 (Ohio App. 1978), the court said:
Many courts have held that in a proper case the presumption of equality of shares between co-tenants can be rebutted by evidence showing unequal contributions toward the purchase price and that a presumption arises that the parties intended to share the property in proportion to the amounts contributed. The property is then partitioned, or proceeds of a sale are distributed in accordance with the amounts contributed to the purchase price by the co-tenants. See Anderson v. Stacker (Mo. 1958), 317 S.W.2d 417; Moran v. Thomas (1952), 280 App.Div. 1037, 117 N.Y.S.2d 190; Williams v. Monzingo (1944), 235 Iowa 434, 16 N.W.2d 619. Cf. Jezo v. Jezo (1964), 23 Wis.2d 399, 129 N.W.2d 195. See also II Casner, American Law of Property 19, Section 6.5 (1952); 20 American Jurisprudence 2d, 215, Cotenancy and Joint Ownership, Section 118; 86 Corpus Juris Secundum 378, Tenancy in Common, Section 18; Annotation 156 A.L.R. 515. Cf., Annotation, 31 A.L.R.2d 1255, at 1311.So, bottom line: In a joint tenancy, the parties do (by definition) hold equal shares, but that doesn't necessarily mean that they are entitled to equal distributions if the property is partitioned.
Dale
Benny L. Kass
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Chris Burti
Mark Twain said that the thing about death and taxes is that death doesn’t change every time Congress meets…
The same might be said about the common law and the Legislature…
This legislation came to pass to give effect to the device being used as a late life planning tool.
N.C.G.S. Section 41‑2. Survivorship in joint tenancy defined; proviso as to partnership; unequal ownership interests.
(a) Except as otherwise provided herein, in all estates, real or personal, held in joint tenancy, the part or share of any tenant dying shall not descend or go to the surviving tenant, but shall descend or be vested in the heirs, executors, or administrators, respectively, of the tenant so dying, in the same manner as estates held by tenancy in common: Provided, that estates held in joint tenancy for the purpose of carrying on and promoting trade and commerce, or any useful work or manufacture, established and pursued with a view of profit to the parties therein concerned, are vested in the surviving partner, in order to enable the surviving partner to settle and adjust the partnership business, or pay off the debts which may have been contracted in pursuit of the joint business; but as soon as the same is effected, the survivor shall account with, and pay, and deliver to the heirs, executors and administrators respectively of such deceased partner all such part, share, and sums of money as the deceased partner may be entitled to by virtue of the original agreement, if any, or according to the deceased partner's share or part in the joint concern, in the same manner as partnership stock is usually settled between joint merchants and the representatives of their deceased partners. Nothing in this section prevents the creation of a joint tenancy with right of survivorship in real or personal property if the instrument creating the joint tenancy expressly provides for a right of survivorship, and no other document shall be necessary to establish said right of survivorship. Upon conveyance to a third party by less than all of three or more joint tenants holding property in joint tenancy with right of survivorship, a tenancy in common is created among the third party and the remaining joint tenants, who remain joint tenants with right of survivorship as between themselves. Upon conveyance to a third party by one of two joint tenants holding property in joint tenancy with right of survivorship, a tenancy in common is created between the third party and the remaining joint tenant. A conveyance of any interest in real property by a party to one or more other parties, whether or not jointly with the grantor‑party, as joint tenants with right of survivorship, creates in the parties that interest, if the instrument of conveyance expressly provides for a joint tenancy with right of survivorship.
(b) The interests of the grantees holding property in joint tenancy with right of survivorship shall be deemed to be equal unless otherwise specified in the conveyance. Any joint tenancy interest held by a husband and wife, unless otherwise specified, shall be deemed to be held as a single tenancy by the entirety, which shall be treated as a single party when determining interests in the joint tenancy with right of survivorship. If joint tenancy interests among three or more joint tenants holding property in joint tenancy with right of survivorship are held in unequal shares, upon the death of one joint tenant, the share of the deceased joint tenant shall be divided among the surviving joint tenants according to their respective pro rata interest and not equally, unless the creating instrument provides otherwise.
This subsection shall apply to any conveyance of an interest in property created at any time that explicitly sought to create unequal ownership interests in a joint tenancy with right of survivorship. Distributions made prior to the enactment of this subsection that were made in equal amounts from a joint tenancy with the right of survivorship that sought to create unequal ownership shares shall remain valid and shall not be subject to modification on the basis of this subsection. (1784, c. 204, s. 6; R.C., c. 43, s. 2; Code, s. 1326; Rev., s. 1579; C.S., s. 1735; 1945, c. 635; 1989 (Reg. Sess., 1990), c. 891, s. 1; 1991, c. 606, s. 1; 2009‑268, s. 1; 2010‑96, s. 9.)
Thanks,
Chris Burti
Marcin Tustin
Without getting into the details of the cited case, which on any view must be incorrect in the manner identified, I note that in England, where land is conveyed to joint tenants and there is an intention that their shares be unequal, then they are treated as trustees for themselves, holding the title as tenants in common in equity.
That is another way to reach a similar result without doing violence to the usual understanding of the concept of a joint tenancy (in case of a divorce the courts have discretion to alter the shares of property as they fit).
Calvin, Charles D.
Colorado, by statute, allows unequal joint tenancies, although the inequality is disregarded for Medicaid recovery purposes:
C.R.S. 38-31-101(6):
(a) The interests in a joint tenancy may be equal or unequal. The interests in a joint tenancy are presumed to be equal and such presumption is:
(I) Conclusive as to all persons who obtain an interest in property held in joint tenancy when such persons are without notice of unequal interests and have relied on an instrument recorded pursuant to section 38-35-109; and
(II) Rebuttable for all other persons.
(b) This subsection (6) does not bar claims for equitable relief as among joint tenants, including but not limited to partition and accounting.
(c) Upon the death of a joint tenant, the deceased joint tenant's interest is terminated. In the case of one surviving joint tenant, his or her interest in the property shall continue free of the deceased joint tenant's interest. In the case of two or more surviving joint tenants, their interests shall continue in proportion to their respective interests at the time the joint tenancy was created.
(d) For purposes of the "Colorado Medical Assistance Act", articles 4, 5, and 6 of title 25.5, C.R.S., a joint tenancy shall be deemed to be a joint tenancy with equal interests among the joint tenants regardless of the language in the deed or other instrument creating the joint tenancy.
Chuck Calvin
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Barlow Burke
An interesting question. I have always thought that a joint tenant’s share was presumptively or had to be an equal or proportionate one, but that in any event, and in partition., it being an equitable cause of action, the court had discretion to vary the shares in the proceeds of a sale or in the physical division of the property. This explains the case cited at the top of this thread, without the statute from the N. Y. domestic relations code.