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Conduct Effecting Joint Tenancy Severance

Two spouses jointly owned their matrimonial home. They had recently separated and were in the process of dividing their assets when the husband died. At that point, title still remained in joint tenancy; the wife accordingly claimed exclusive possession as the surviving joint tenant.

However, two of the husband’s daughters from a prior relationship had a competing claim: they asserted that one-half of the husband’s joint interest in the home was actually part of the residue of the estate (to which the daughters were entitled under his Will). They argued that the husband’s negotiations with the wife as part of the marital separation evinced a mutual intention that they become tenants-in-common rather than joint tenants; as such, his interest home had devolved to his estate upon death. The daughters were unsuccessful on application before a judge, so they appealed.

The legal question for the court was whether the spouses’ conduct upon separation was sufficient to sever their joint tenancy. This required the application of the “course of dealing” test, in which the court looked for evidence that the parties intended to mutually treat their property interests as being those of tenants-in-common, rather than joint tenants. There was no requirement for proof of a specific intention communicated by each to the other; rather, the co-owners must each know of the other’s position. This knowledge could be inferred from the parties’ communication or conduct. Also, they must have treated their respective interests as no longer being held jointly.

Here, looking at all the evidence, the spouses’ conduct upon separating demonstrated their mutual intention to consider the joint tenancy as being severed, and to have their co-ownership continue as tenants-in-common. Accordingly, when the husband died his interest in the home devolved to his estate. See Hansen Estate v. Hansen, 2012 (ONCA).