Leaving aside other means of severance, including that which occurs on bankruptcy or by judicial sale, there are three main ways to sever a joint tenancy:

1. Unilaterally acting on one’s own share, such as selling or encumbering it;
2. A mutual agreement between the co-owners to sever the joint tenancy; and
3. Any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common.

In Marley v Salga, 2019 ONSC 3527, the Court considered whether the joint tenancy of a house was severed by a “course of dealing” (point 3, above).

Leslie Salga lived with his second wife, Karen Marley, from their marriage in 1999 until his death in 2015. They lived together in a house which, when it was purchased, was registered to Ms. Marley and Mr. Salga as joint tenants. No change was made to the registered title during Mr. Salga’s lifetime.

Mr. Salga had three children from a previous marriage: two daughters, Suzanne Salga and Michelle Salga, and a son, Andrew Salga. In his will, which was prepared by a lawyer, Mr. Salga designated personal property to be given to each of his children and Ms. Marley. Suzanna and Michelle were the beneficiaries of any remaining property. After the distribution of personal property, the residue of the estate was of minimal value aside from the home.

The sisters sought an order declaring their entitlement to an undivided half interest in the home as residuary beneficiaries. Conversely, Ms. Marley sought a declaration that she is the sole legal and beneficial owner of the home, having inherited Mr. Salga’s share through the right of survivorship.

The Court relied on three pieces of evidence in finding that the joint tenancy was mutually severed through a course of dealings:

1. Salga’s will,
2. A recording of a conversation between Ms. Marley and Mr. Salga while he was in hospital during his final illness, and
3. An affidavit from a close friend of the Mr. Salga which detailed a conversation between them.

The terms of Mr. Salga’s will were clearly inconsistent with the right of survivorship inherent in joint tenancy; the will granted Ms. Marley “the use, occupation and enjoyment” of his “one-half interest” in the home. Under the will, Ms. Marley’s right to occupy would be subject to certain conditions (such as Ms. Marley continuing to pay taxes, insurance premiums and other payments), and her rights would cease in certain circumstances (for example, if she dies or advises the estate trustees that she no longer desires to have the property held for her).

While a testamentary disposition on its own cannot sever a joint tenancy, it can be used to help discern whether there was a common intention to treat a joint tenancy as severed. In this case, the Court viewed the will as evidencing an assumption by Mr. Salga that he owned a half-interest (as a tenant in common) in the home that would become part of his estate on death.

The Court found the hospital conversation evidenced that Mr. Salga and Ms. Marley were mutually in agreement as to how the property was to be handled on his death. During the conversation, Ms. Marley and Mr. Salga discussed that “everybody’s getting everything 50-50” and “all this is going to be written.” Mr. Salga asked whether this was a deal, to which Ms. Marley responded “yes, it’s a deal.”

Similarly, the affidavit from the close friend referenced a conversation during which Mr. Salga indicated, in the presence of Ms. Marley, that upon his death his half interest in the home would pass to his daughters while Ms. Marley would retain her half interest.

Ms. Marley’s appeal was dismissed by the Court of Appeal for Ontario.

Conclusion

Whether a joint tenancy was severed through a course of dealing is a fact specific inquiry. In determining whether or not a joint tenancy was severed by a course of dealing, courts will consider whether the evidence offered in support of such a claim shows that all parties treated their interests as constituting a tenancy in common.