MCGREGOR
THE ACQUISITION OF REAL PROPERTY (i.e. land or building), will rank as the most important investment of anyone's life. It symbolises a crowning moment and the ultimate demonstration of independence. Hence, many persons will express a selfish desire for real property to be registered in their sole name, especially if the investment was not the product of pooled resources.
ADVANTAGES OF SOLE PROPRIETORSHIP
The obvious advantage in this scenario is that the sole proprietor will have complete autonomy in the disposition or management of the property. However, if at the time of purchasing property, one is able to identify a particular individual (or individuals) in whom one would like the property to vest at some future date, joint ownership may be advisable to avoid the costs associated with a later transfer.
JOINT TENANCY VS TENANCY IN COMMON
There are two types of joint ownership:
Joint tenancy.
Tenancy in common.
The main distinction relates to the ability of one of the owners to dispose of the property by sale or under a will. Whereas one of several tenants in common may be able to sell his share of the property at any time, use it as security or make provision under his will for it to be transferred to a beneficiary, joint tenants cannot do so. When one joint tenant dies, his interest in the property will automatically pass to the other joint tenants by virtue of what is called "the right of survivorship."
A joint tenant's interest in property is not defined or separated from the whole. He is said to own an undivided share in the whole property. By contrast, a tenant in common has a right to a specific share in property, and this share does not have to be equal to that of his co-owners.
Joint tenancy is the ideal form of ownership between husband and wife, where the parties are content for the survivor to be the sole owner. Where co-owners are not married or have made unequal contribution to the purchase price of the property, tenancy in common is the more convenient form of ownership.
Joint ownership may impact on rights which individuals may acquire through marriage or cohabitation. For example, pursuant to the Property (Rights of Spouses) Act, each spouse is presumed to be entitled to a 50 per cent share in the "family home." However, the presumption will not arise if the couple resides in a home which is registered in the joint names of one spouse and a third party. So, the family home must be owned solely by one or both spouses.
The manner in which property is held may be altered. Property registered in one person's name can be transferred into joint names. A joint tenancy may be severed to create a tenancy in common, and a tenancy in common may be partitioned so that each of several co-owners can obtain a separate title for his share of the property. However, the process of altering ownership of real property may prove to be costly and time-consuming, so it is always best to give careful thought to how one intends to own property at the time of acquisition.
Note: The Property (Rights of Spouses) Act and the Maintenance Act came into effect on April 1, 2006.
Sherry-Ann McGregor is a partner and mediator in the law firm of Nunes, Scholefield, DeLeon & Co. Send feedback and comments to lawsofeve@yahoo.com.
