Co-ownership and trusts of land

Co-ownership exists when two or more persons hold simultaneous interests in land. Since 1925, the legal estate must be held as a joint tenancy by up to four trustees (ss 1(6), 34(2), 36(2) LPA 1925), while equitable interests may be either joint tenancy or tenancy in common. The key distinction: joint tenancy carries the right of survivorship (ius accrescendi); tenancy in common creates distinct, transmissible shares. Since 1997, all co-owned land is held under a trust of land governed by TOLATA 1996, which grants beneficiaries occupation rights (s 12), requires trustee consultation (s 11), and provides a framework for resolving disputes (ss 14-15). The doctrine ensures marketability through simplified legal title while protecting diverse beneficial interests behind the trust curtain.

Stack v Dowden [2007] UKHL 17: Where legal title is jointly held, equity follows the law (joint tenancy) absent contrary intention; express declarations of trust are conclusive absent fraud or mistake. Shifts focus from resulting to constructive trust analysis in domestic contexts.

Williams & Glyn's Bank Ltd v Boland [1981] AC 487: Spouse's equitable interest under trust + actual occupation = overriding interest binding mortgagee. Capital money paid to sole trustee does not overreach beneficial interests.

Burgess v Rawnsley [1975] Ch 429: Equitable joint tenancy may be severed by: (1) written notice under s 36(2) LPA; (2) act on own share; (3) mutual agreement; (4) course of dealing. Negotiations to buy out co-owner's share evidenced severance by agreement.

Bank of Ireland v Bell [2001] 2 FLR 809: After one year from bankruptcy, s 335A IA 1986 creates presumption that creditors' interests outweigh all others unless "exceptional circumstances" exist. Ordinary hardship to family insufficient.

Mortgage Corporation v Shaire [2001] Ch 743: Outside bankruptcy, s 15 TOLATA requires genuine balancing of factors including trust purpose and family occupation. Court not "rubber stamp" for creditors.

Courts apply a structured analysis: (1) Identify legal title: always joint tenancy, maximum four trustees. (2) Determine equitable interests: check for express declaration (conclusive per Stack); absent declaration, examine contributions, purpose, and intentions for presumptions. (3) Check for severance: written notice under s 36(2), acts on share, mutual agreement, or course of dealing. (4) Apply TOLATA framework: s 14 applications resolved using s 15 factors (settlor intention, trust purpose, minors' welfare, creditor interests) unless trustee in bankruptcy applies after one year, triggering s 335A presumption. (5) Consider third parties: overreaching requires payment to two+ trustees; beneficial interests may be overriding if coupled with actual occupation. Key test: has legal/equitable divide been properly managed?

Confusing legal/equitable: Legal title is always joint tenancy; only equitable can be tenancy in common. Severance affects only equitable interests—legal joint tenancy continues.

Overreaching errors: Requires payment to TWO trustees minimum. Sole trustee cannot overreach (Boland).

Misapplying s 335A: Only applies to trustee in bankruptcy after one year. Other creditors use standard s 15 analysis.

Ignoring express declarations: Post-Stack, express beneficial declarations are conclusive—don't argue resulting trust based on unequal contributions unless pleading fraud/mistake.