Joint tenancy has a lot in common with the TV show Survivor: the goal is to outlast your fellow castaways to win the prize – full ownership of the property. To escape this game show mentality, owners may sever the joint tenancy. Once the property is held in tenancy in common, each owner’s share of the property passes to her estate on death and not to the surviving co-owner.

There are three ways of severing a joint tenancy: (i) the unilateral act of one joint tenant with respect to her interest; (ii) the mutual agreement of the joint tenants; and (iii) any course of dealing which shows that the interests of all were mutually treated as constituting a tenancy in common. The question recently addressed by the Court of Appeal of Alberta in Flock Estate v Flock, 2022 ABCA 229, is whether it is too late to declare that a joint tenancy was severed after the death of a joint owner.

Arlene and Doran were married in 1982. In December 1993 they purchase a home together in Calgary. Less than a year later, they separated – Doran moved out of the house and Arlene began paying all property expenses (including the mortgage). While the couple were officially divorced in 1999, they continued to be engaged in acrimonious matrimonial litigation over the division of property until Arlene’s death in 2014.

Arlene remarried in 2009 and her new husband moved in with her. Together, they paid off the mortgage and renovated the house. After Arlene’s death, her new husband continued living in the property and stepped into the role of executor of Arlene’s estate.

In 2015, Arlene’s estate brought an application seeking an order severing the joint tenancy on the basis that Arlene and Doran had, by their course of dealings, demonstrated an intention to sever the joint tenancy. In response, Doran commenced a claim against Arlene’s second husband alleging that he wrongfully enjoyed exclusive use of the property without paying rent.

The severance application was heard in 2021. At the hearing, Doran argued that the right to apply to sever the joint tenancy was extinguished by Arlene’s death. The application judge disagreed.[1] The application judge went on to find that Arlene and Doran’s “course of dealings” in the 20 years between their separation and Arlene’s death clearly demonstrated an intention to sever the joint tenancy:

– Doran moved out of the property in 1994, while Arlene (and later her second husband) continued to occupy the property.

– Arlene (and her second husband) paid all the property expenses and renovation costs without any financial contribution from Doran.

– Doran and Arlene were engaged in matrimonial litigation over the division of property for over two decades.

In the result, the application judge held that the joint tenancy had been severed, that Arlene’s estate and Doran held a 50/50 interest in the property, and that no occupation rent or other payment was owing by Arlene’s second husband.

Doran appealed. Among other grounds, Doran argued that the right of survivorship extinguished any rights Arlene’s estate had in the property, meaning it was too late to seek a severance order.

The Court of Appeal upheld the application judge’s finding, holding:

The right of survivorship is a distinguishing feature of a joint tenancy … However, the appellant’s reliance on the right of survivorship as a bar to the Severance Application misses the point. The issue before the application judge was whether severance should operate in equity to prevent the appellant from asserting any right of survivorship … The question was whether the parties, by their course of dealings before [Arlene’s] death, treated their interests in the Property as constituting interests held by tenants in common, meaning the Property would not pass by the right of survivorship to either of them upon the death of the other.
…
We agree with the application judge; if the right to bring a civil proceeding to sever the joint tenancy was extinguished by death it would render the third ground for severance meaningless.

The Court of Appeal further noted that the third ground for severance, mutuality of intention, is to be inferred from a course of dealings: it does not require proof of explicit intention or evidence of an agreement. This third ground of severance is grounded in equity and will be based on the unique facts of each case.

As this case shows, while death brings an end to many things, the equitable right of severance is not one of them.

[1] Among other cases, the application judge cited Hansen Estate v Hansen, 2012 ONCA 112, where death was not seen as a bar to a finding that joint tenancy had been severed.