In real estate law, title as term is used to describe a bundle of proprietary rights in a piece of real estate held by the owner of that property. It is also a reference to a formal legal document, such as the title deed, which serves as evidence of ownership. On the title there can be various methods of ownership, for instance a sole owner and thus a single name can be listed, or otherwise in the case of fellow investors in the property or a marriage more than one party can also be listed. Title to property can also be held by corporations, trustees and partnerships. Whose name shall be listed is an important question to consider when purchasing a property.

In Co-ownership:

In a situation where more than one person has legal proprietary rights to the property, there are typically two ways of sharing these proprietary rights;

  1. Joint Tenancy;
  2. Tenants in Common;

Joint Tenancy;

In Joint tenancies the distinctive features include what is known as the ‘right of survivorship’ and the equal share in the property by each joint tenant. The right of survivorship holds that in the case of the death of one joint tenant the property his or her share will be transferred to the surviving joint tenant(s). Additionally, in Joint tenancies each owner is presumed and held to own an equal share in the property. That is to say that where there are 2 joint tenants, each tenant owns 50%, and if there are more such as 4 then each tenant owns 25%. Joint Tenancy can also be severed, however that is a topic addressed in another article.

Tenants in Common;

Where property is held in the Tenants in Common method of Co-ownership there is no right to survivorship and distinct shares (as opposed to equal) can exist for each tenant. That is to say that a Tenant in Common can upon death leave their share to a beneficiary via there will whereas a joint tenant cannot (except the last surviving joint tenant). Additionally, a Tenant in common may have varying distinct shares; for instance, one party may own 55% interest and the other 45%.

The Matrimonial Home:

Typically, most family Law practitioner and/or Real estate lawyers advise their married clients to hold their marital home as equal joint tenants. Such an arrangement makes each partner full owners of the property and the right of survivorship will ensure that in case of the death of one partner or spouse the surviving spouse will automatically become the sole owner of the marital home. Additionally, it guards the property from being caught up in probate hearings and can assist in significant tax savings. There are however still legal and administrative fees involved with transfer of title to the surviving spouse or joint tenant.

Additionally, it is significant to note that the matrimonial home holds a distinct position and is a special asset in Canadian family law and real estate law. Family law regarding the matrimonial home overrides any listed ownership on the title. Whether a spouse is on the title or not the value of the matrimonial home is split between both spouses.

It is not recommended to add another third party, other than the spouse as a joint tenant to the matrimonial home. This is a risk inducing measure which poses the threat of the matrimonial home being caught up in the third parties financial or marital issues. A reputable and experienced family law and real-estate lawyer can help clients navigate and advise as to what the best co-ownership arrangements are available.

At times however in order for business or tax planning benefits it may be advisable that the matrimonial home is legally owned by one partner only. Additionally, in a joint tenancy situation the drafting of a Testamentary Will can be slightly more difficult. If a spouse wishes to, upon their death, leave their interest to their child, this would need to be done via the Wills of both joint tenants.

For more information please contact one of our experienced Real Estate Lawyers at MEHDI AU LLP.

Disclaimer: Use of this site and sending or receiving information through it does not establish a solicitor / client relationship. The views expressed and the content provided on this blog is for non-profit educational purposes. It is not, and is not intended to be, legal advice on any specific set of facts. The use of this website does not create a solicitor-client (attorney-client) relationship. If you require legal advice, you should contact a lawyer directly.

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Use of the site and sending or receiving information through it does not establish a solicitor / client relationship. The views expressed and the content provided on this blog is for nonprofit educational purposes. It is not, and is not intended to be, legal advice on any specific set of facts. The use of this website does not create a solicitor-client (attorney-client) relationship. If you require legal advice, you should contact a lawyer directly.