Joint Tenancies – Who Gets What on Death?

The transfer of the legal interest in property into joint tenancy gives rise to three potential scenarios:

a) The creation of a true joint tenancy, in which each of the joint tenants is an owner of the whole, with each enjoying the full benefit of property ownership, and with the ultimate survivor enjoying the whole title;

b) The creation of a resulting trust, where only one joint tenant owns the beneficial interest and the other holding the title in trust for the other with no beneficial interest; and

c) A gift of the right of survivorship, where a joint tenant is gratuitously placed on title with no beneficial interest in the property until the death of the donor.

Pecore v. Pecore, 2007 SCC 17; Petrick (Trustee [of]) v. Petrick, 2019 BCSC 1319 at para. 40.

The right of survivorship (in other words, the right to “inherit” upon surviving the donor) is a necessary incident of a joint tenancy. When a joint tenant dies, his or her interest in the property is extinguished. The surviving joint tenants continue to hold the property as joint tenants. The last surviving joint tenant takes full ownership of the property: McKendry v. McKendry, 2017 BCCA 48 at para. 28.

So long as the requirements of a binding gift are met, the owner of property may, during his or her lifetime, make an immediate gift of a joint tenancy, including the right of survivorship. This is so regardless of whether the donee of the gift is to hold it for the benefit of the donor while the donor is alive. When gifted inter vivos, the right of survivorship is a form of expectancy regarding the future. It is a right to what is left of the jointly-held interest when the donor dies: Simcoff v. Simcoff, 2009 MBCA 80 at para. 64; Bergen v. Bergen, 2013 BCCA 492 at para. 37; Pecore at paras. 45–53.

Moreover, a donor may gift the right of survivorship but continue to deal freely with the property throughout his or her lifetime: McKendry at para. 30; Simcoff v. Simcoff, 2009 MBCA 80 at para. 64. Accordingly, the gift is the donee’s survivorship interest in the property, whatever it may be, at the time of the donor’s death: Pecore at para. 50.

Placing a party on title to property as a joint tenant constitutes a legal transfer of the property at law. The legal and equitable title (i.e., the right of survivorship) of a joint tenancy vest at the time the joint tenancy is created. An inter vivos gift of a joint tenancy is a gift that cannot be retracted by the donor and is therefore a “complete and perfect inter vivos gift”: Pecore at para. 49. See also: McKendry at para. 32. However, the gift is only perfected when the donor intends to transfer title in joint tenancy—and all the concomitant legal and equitable rights—to the donee: Bergen v. Bergen, 2013 BCCA 492 at paras. 37, 40, 42; Beams v. Mills Estate, 2015 BCSC 1269 at para. 147.

In a case involving, as here, a gratuitous transfer of an interest in land to an independent adult child, it does not follow as a matter of law that an immediate irrevocable gift was made. Rather, the donee must rebut the legal presumption of a resulting trust: Schouten Estate v. Swagerman-Schouten, 2014 BCSC 2320 at paras. 2–3; Pecore at paras. 24–26; Bergen at para. 5. If, on a balance of probabilities, the donee establishes that the donor’s intention was to make an irrevocable gift, a resulting trust will not be found: Pecore at paras. 43–44, 55; Schouten Estate at para. 7.

The actual intention of the donor at the time of the transfer is the governing consideration in the assessment of whether the presumption of resulting trust has been rebutted: McKendry at para. 31. Evidence that the donor may have had second thoughts afterwards but took no steps to revoke the gift does not assist in rebutting the presumption, as the analysis is focused on the transferor’s intention at the time the transfer was made: Bakken Estate v. Bakken, 2014 BCSC 1540 at para. 74.

Generally speaking, evidence of the donor’s intention ought to be contemporaneous with the transfer, or nearly so: Pecore at para. 56. Post-transfer conduct must be approached with caution: Schouten Estate at para. 6; Bakken Estate at para. 74. Where the donor’s intention is clear, the presumption of resulting trust is not engaged: Petrick at para. 47.

The mere fact that the donor has maintained control of and management over the property after the transfer does not mean that he or she did not intend to gift the joint interest. Such evidence is not necessarily inconsistent with an intention to gift and, without more, is not determinative: Pecore at para. 66; Madsen Estate v. Saylor, 2007 SCC 18 at para. 19; McKendry at paras 29–30.

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