Co-ownership - Severance of joint tenancies

Learning Outcomes

This article outlines severance of joint tenancies in equity, including:

• The core features of joint tenancies and tenancies in common, highlighting why severance matters for SQE1, and how the right of survivorship differs from devolution of shares under wills or intestacy.
• Statutory severance by written notice under s36(2) LPA 1925, the need for a clear and immediate intention, and how s196 LPA 1925 service rules determine effectiveness and timing.
• The Williams v Hensman common law methods—acts operating on a joint tenant’s own share, mutual agreement, and a mutual course of dealing—with emphasis on evidential requirements and common exam traps.
• Severance by operation of law in cases of bankruptcy and unlawful killing, including the impact of the Insolvency Act 1986 and forfeiture principles on the continuation of any beneficial joint tenancy.
• How severance affects the size and nature of beneficial shares, the end of survivorship, and the interaction with wills, intestacy rules, family proceedings, and dealings with third parties.
• Practical exam-focused strategies for identifying severance in multi‑party fact patterns, analysing problem questions involving notice, registration and Form A restrictions, and avoiding confusion with constructive trust quantification issues.

SQE1 Syllabus

For SQE1, you are required to understand severance of joint tenancies in equity and co-ownership fundamentals, with a focus on the following syllabus points:

• the distinction between joint tenancy and tenancy in common
• the statutory and common law methods of severance of joint tenancies
• the legal and practical consequences of severance, including the end of the right of survivorship
• how to identify and apply the correct method of severance in a given scenario
• service of written notice, including s196 LPA 1925 methods and case law on immediacy, delivery and revocation
• severance where there are three or more co‑owners, bankruptcy, and unlawful killing
• recording severance and protecting interests on the register (Form A restriction) and interaction with overreaching

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. What statutory provision allows a joint tenant to sever a joint tenancy by written notice?
2. Name two common law methods (other than written notice) by which a joint tenancy in equity can be severed.
3. What is the effect of severance on the right of survivorship?
4. True or false? Severance of a joint tenancy in law is possible under the Law of Property Act 1925.

Introduction

Co-ownership of land can exist as either a joint tenancy or a tenancy in common. Severance is the legal process that converts a joint tenancy in equity into a tenancy in common, fundamentally altering the rights of the co-owners. For SQE1, you must be able to identify the methods of severance, apply them to practical scenarios, and understand the consequences for the parties involved.

Types of Co-ownership

Co-owners may hold the legal estate only as joint tenants. However, the beneficial (equitable) interest can be held as either a joint tenancy or a tenancy in common.

Key Term: joint tenancy
A form of co-ownership where each owner is entitled to the whole property, with no distinct shares, and the right of survivorship applies.

Key Term: tenancy in common
A form of co-ownership where each owner holds a distinct share in the property, which can be equal or unequal, and there is no right of survivorship.

Severance: Meaning and Effect

Severance is the process by which a joint tenancy in equity is converted into a tenancy in common. This ends the right of survivorship, so that on the death of a co-owner, their share passes under their will or intestacy, not automatically to the other co-owners. Severance affects only the equitable interest; the legal estate remains a joint tenancy and cannot be severed.

Key Term: severance
The legal process that converts a joint tenancy in equity into a tenancy in common, ending the right of survivorship.

The timing of severance matters. If severance is effective before a co-owner’s death, survivorship is displaced and the deceased’s share passes through their estate. If not, survivorship operates immediately on death, regardless of testamentary wishes.

Methods of Severance

Severance can only occur in relation to the equitable (beneficial) interest. The legal estate must always remain a joint tenancy.

There are several recognised methods of severance in equity:

Statutory Severance: Written Notice

Section 36(2) of the Law of Property Act 1925 allows a joint tenant to serve written notice on the other joint tenants expressing an immediate intention to sever. No particular form is required, but the notice must make clear that severance is intended now; a desire to sever at some future date is insufficient.

Key Term: written notice (severance)
A unilateral written communication by a joint tenant to the others, expressing a clear and immediate intention to sever the joint tenancy in equity.

Clarity and immediacy

• The notice must evince an immediate, irrevocable intention to bring about severance. A prayer in a divorce petition seeking that property “be adjusted” in future lacked the necessary immediacy.
• By contrast, a written step that seeks a court-ordered sale and immediate division has been treated as evidencing the requisite present intention.

Service and delivery

• Notice must be “given” to all other joint tenants. Service can be achieved by leaving it at a joint tenant’s last known place of abode or business in the UK (s196(3) LPA 1925) or by sending it by registered/recorded post to that address (s196(4) LPA 1925). If properly addressed, pre‑paid and posted, service is effective unless the letter is returned undelivered.
• Delivery to the last known abode is effective even if the recipient does not in fact read it. Evidence of delivery (e.g. a postman’s statement) may be needed if ordinary post is used.
• Once a valid notice has been delivered in accordance with s196, severance takes effect and the giver cannot revoke it later.

Content and addressees

• The notice should be addressed to all other beneficial joint tenants and identify the property. It is good practice to state expressly that severance is with immediate effect and that the sender intends thereafter to hold as a tenant in common.

Practical point Keep proof of posting and delivery. Using recorded post or a process server minimises disputes.

Worked Example 1.1

Scenario: Priya and Samir own a house as joint tenants in equity. Priya sends Samir a signed letter stating she wishes to sever the joint tenancy with immediate effect.

Answer:
Priya's letter is a valid written notice under s36(2) LPA 1925. The joint tenancy in equity is severed, and Priya and Samir now hold as tenants in common in equal shares.

Worked Example 1.2

Scenario: Two sisters, Fatima and Grace, own a house as joint tenants in equity. Fatima serves a written notice of severance on Grace, but dies before Grace reads the letter.

Answer:
Severance by written notice is effective upon delivery, not receipt. Fatima’s notice, properly delivered to Grace’s last known abode, severed the joint tenancy before death. Fatima's share passes under her will or intestacy, not by survivorship.

Common Law Severance: Williams v Hensman Methods

Apart from written notice, severance can occur by the following common law methods (Williams v Hensman (1861)):

1. Act operating on a joint tenant’s own share

A joint tenant may sever by dealing with their own share, such as selling, mortgaging, or otherwise disposing of it.

Key Term: act operating on own share
A unilateral act by a joint tenant (e.g., sale, mortgage, or contract to sell) that severs the joint tenancy in equity as to their share.

Key points:

• An actual disposition of the beneficial interest (e.g., a transfer/gift) will sever immediately as to the disponor’s share.
• A specifically enforceable contract to dispose of the beneficial interest will also sever (equity regards as done that which ought to be done) provided it complies with s2 Law of Property (Miscellaneous Provisions) Act 1989.
• Taking out an equitable mortgage of the beneficial interest is sufficient to sever as an act operating on the joint tenant’s own share.

2. Mutual agreement

All joint tenants may expressly or impliedly agree to sever the joint tenancy.

Key Term: mutual agreement (severance)
An express or implied agreement between all joint tenants to sever the joint tenancy in equity.

Key points:

• The agreement need not be in writing; an oral agreement supported by consideration is sufficient. It need not be carried through to completion: it is the consensus to treat interests as separate that matters.
• Evidence of actual agreement to hold in separate shares (for example agreeing a price for one buying out the other) is powerful evidence of mutual agreement to sever.

3. Course of dealing

A course of conduct between the joint tenants that demonstrates they all treat their interests as separate may amount to severance.

Key Term: course of dealing (severance)
A pattern of conduct between joint tenants showing a mutual understanding that their interests are held separately, sufficient to sever the joint tenancy in equity.

Key points:

• There must be a mutual understanding manifested by conduct that the beneficial interests are held separately. Repeated negotiations to sell and divide the proceeds, instructions to solicitors to sell and split equally, or agreement to divide net proceeds can indicate the parties no longer regard themselves as joint tenants.
• Mere inconclusive negotiations, or unilateral statements, will not suffice. Physical occupation of different parts is not, without more, determinative.

Worked Example 1.3

Scenario: Three friends, Alex, Ben, and Chloe, own a flat as joint tenants in equity. Alex sells his beneficial interest to Dana. What is the effect?

Answer:
Alex's sale of his beneficial interest is an act operating on his own share, severing the joint tenancy in equity as to his share. Dana becomes a tenant in common with Ben and Chloe, who remain joint tenants between themselves.

Severance by Operation of Law

Certain events automatically sever a joint tenancy in equity:

• Bankruptcy of a joint tenant (their beneficial interest vests in the trustee in bankruptcy)
• Unlawful killing (the forfeiture rule prevents a killer from benefiting from survivorship)

Bankruptcy

• On a bankruptcy order, the bankrupt’s beneficial interest vests in the trustee in bankruptcy (Insolvency Act 1986). This operates as severance as to that share. Timing can matter: severance is effective from the bankruptcy order so that subsequent survivorship does not defeat the trustee’s title.
• The trustee will generally claim the bankruptcy share for creditors. On a later sale, the trustee’s share is treated as held as a tenancy in common with the non‑bankrupt co‑owner.

Unlawful killing (forfeiture)

• A joint tenant who unlawfully kills another cannot benefit from survivorship. The beneficial joint tenancy is severed, and the victim’s share passes under their estate. The Forfeiture Act 1982 gives the court a discretion to modify the effect of forfeiture (other than in murder), but survivorship will not be permitted to operate.

Worked Example 1.4

Scenario: Brian and Nina hold as beneficial joint tenants. Brian is made bankrupt. Before any order for sale, Nina dies.

Answer:
Brian’s bankruptcy severed the beneficial joint tenancy as to his share when the bankruptcy order was made, so Nina’s subsequent death does not pass Brian’s share to her by survivorship. Brian’s severed share belongs to his trustee in bankruptcy; Nina’s severed share passes through her estate.

Exam Warning

Severance only affects the equitable (beneficial) interest. The legal estate remains a joint tenancy and cannot be severed. Always check whether the question concerns the legal or equitable title. Beware of conflating constructive trust quantification issues with severance; distinct analyses are required.

Consequences of Severance

After severance, the co-owners hold as tenants in common in equity. Each has a distinct share, usually equal unless otherwise agreed or determined by contributions. The right of survivorship no longer applies—each share passes under the deceased’s will or intestacy.

Shares on severance

• In the absence of evidence that different beneficial shares were agreed or arise under a trust analysis, the severed shares are presumed equal (e.g., two co-owners: 50/50).
• Where there are three or more beneficial joint tenants and one severs, that person takes a separate share equivalent to their notional fraction (e.g., 1/3), and the others continue to hold the remaining fraction as joint tenants between themselves until they too sever or otherwise alter the arrangement.

Dealings after severance

• A tenant in common can dispose of their distinct beneficial share by will or inter vivos. They cannot unilaterally affect the other co-owners’ shares.
• The legal estate remains vested in the trustees (up to four) as legal joint tenants. A sale by two trustees (or a trust corporation) will overreach the beneficial interests, attaching them to the sale proceeds.

Worked Example 1.5

Scenario: D, E and F are beneficial joint tenants. D serves a valid written notice of severance. Later, E dies.

Answer:
D holds a 1/3 beneficial share as a tenant in common. E and F remain joint tenants of the remaining 2/3. On E’s death, survivorship operates only within the continuing joint tenancy of E and F over that 2/3; F now owns that 2/3 beneficial interest outright. D’s 1/3 remains separate and will pass under D’s will or intestacy on D’s death.

Worked Example 1.6

Scenario: Two sisters, Fatima and Grace, own a house as joint tenants in equity. Fatima serves a written notice of severance on Grace, but dies before Grace reads the letter.

Answer:
Severance by written notice is effective upon delivery, not receipt. Fatima's share passes under her will or intestacy, not by survivorship to Grace.

Practical Points and Registration

Severance does not require registration to be effective, but it is best practice to record the change, especially for registered land, to avoid disputes and ensure clarity for third parties.

Key Term: Form A restriction
A restriction entered on the proprietorship register stating that no disposition by a sole proprietor of the registered estate (not being a trust corporation) under which capital money arises is to be registered unless authorised by an order of the court.

Why record severance?

• Entering a Form A restriction signals that the beneficial title is held as tenants in common. This alerts buyers and lenders that overreaching requirements must be observed.
• A Form A restriction does not create or effect severance. It records that beneficial interests are held other than as joint tenants. Severance remains a question of substance (e.g., notice, act, agreement) rather than registration.

Service and evidence

• Where severance is by written notice, keep clear evidence of service (postal proofs or a process server’s statement) and consider serving at all known residential or business addresses. If relying on s196(4), ensure proper addressing, pre‑payment and use of recorded/registered post.

Overreaching on sale

• Even where severance has occurred, a purchaser paying capital money to at least two trustees (or a trust corporation) will overreach the beneficial interests, which then attach to the proceeds. A registered Form A restriction helps ensure the overreaching mechanics are followed where there is a sole proprietor.

Financial arrangements and severance

• Parties’ post‑acquisition financial management sometimes appears in litigation. Separate finances and treating equity as distinct can be evidence of a course of dealing pointing to severance. However, post‑acquisition contributions and financial arrangements are more commonly used to quantify beneficial shares under a constructive trust rather than to sever; do not assume separate finances alone amount to severance.

Worked Example 1.7

Scenario: G and H are beneficial joint tenants. Over several years they repeatedly instruct agents to market the property, agree in writing that net sale proceeds will be divided equally, and liaise via solicitors on draft contracts reflecting equal division. The sale falls through. Neither has served a s36(2) notice.

Answer:
A court may find severance by a mutual course of dealing: their repeated, consistent conduct indicates they regarded themselves as having distinct shares. If established, the beneficial joint tenancy is severed and they hold as tenants in common, typically in equal shares.

Summary

Key Point Checklist

This article has covered the following key knowledge points:

• Severance converts a beneficial joint tenancy into a tenancy in common and ends the right of survivorship.
• Only the equitable (beneficial) interest can be severed; the legal estate remains a joint tenancy.
• Statutory severance by written notice (s36(2) LPA 1925) requires a clear and immediate intention and effective service (s196 LPA 1925). Reading the notice is not required; delivery suffices.
• A notice properly posted by registered/recorded post and not returned undelivered is deemed served; once validly served, it cannot be revoked.
• Common law methods of severance (Williams v Hensman) include: an act operating on one’s own share (including a specifically enforceable contract), mutual agreement, and a mutual course of dealing.
• Certain events sever by operation of law, notably bankruptcy (share vests in the trustee) and unlawful killing (forfeiture prevents survivorship).
• After severance, shares are presumed equal absent contrary agreement or trust-based quantification; in multi‑party cases, those who do not sever can remain joint tenants of the remaining fraction.
• Severance does not itself require registration, but entering a Form A restriction is best practice to reflect tenancy in common and ensure overreaching mechanics are observed on sale.
• Overreaching on sale by two trustees disconnects beneficial interests (including severed shares) from the land and attaches them to the proceeds of sale.

Key Terms and Concepts

• joint tenancy
• tenancy in common
• severance
• written notice (severance)
• act operating on own share
• mutual agreement (severance)
• course of dealing (severance)
• Form A restriction