A joint tenant may sever a joint tenancy with or without the consent or knowledge of the other joint tenant, by a unilateral action, such as a transfer from him or herself to him or herself for the purpose of severing the joint tenancy so there is no longer a right of survivorship.
Such severance changes the ownership of the property, real or personal from a joint tenancy with a right of survivorship ( JTROS) , to a tenancy in common with none.
Such a unilateral action is provided for in section 18(3) of the Property Law act, and section 30 of the Law and Equity act allows for severance of jointly owned personal property to oneself, and another.
After a joint tenant dies, severance is no longer possible, because death extinguishes the joint interest.
For this reason, a testamentary disposition cannot sever a joint tenancy . Bergen v Bergen 2013 BC CA 492 at paragraph 40 .
Severance is typically affected in one of three ways:
1. by unilateral action, which of course at the same time, the transferor loses his or her own right to survivorship ;
2. by mutual agreement, such as a separation agreement;
3. or any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common. (There are seemingly expanding factual situations where the courts may find a severance;)
Other possible modes of severance include bankruptcy, partition, or an order made under matrimonial property legislation. Tessier Estate v Tessier 2001 SKQB 399 at para.8
Unlike transfers, mortgages do not usually take effect by way of conveyance; they operate by way of security is a charge against title. In British Columbia. Section 231 of the land title act provides that a mortgage operates to charge the mortgage was estate or interest in land. In consequence, the four unities are not broken when a mortgages granted, and the joint tenancy is not severed. Nor does a unilateral statement of intention to sever affect us severance.
The law permits joint tenancy and personal property, no less than in realty, thus a joint tenancy may carry on the following a land sale by all joint tenants because joint ownership may constitute in relation to the sale proceeds.
However if the sale proceeds are divided, the four unities are destroyed and in consequence the joint tenancy is severed. Tessier at paras.11-12
In Zeligs v Estate of Zeligs 2016 BCCA 280 a joint tenancy bank account was severed when a co- holder of the chequing account with an enduring power of attorney transferred sale proceeds to herself and her husband ,when the other joint owner ( her mother ) was still alive.
As such, she destroyed the unity of title, which automatically severed the joint tenant see fund, and converted it into a tenancy in common, and distinguished the right of survivorship.
The defendants unilateral action affected severance of the bank account and the court held that she held one half of the sale proceeds in trust for her mother’s (the co-owner) estate.
A jointly held legal right to withdraw funds from a joint bank account does not enable an account holder to assume beneficial ownership of the funds on deposit by the mere act of withdrawal.
On the contrary, where jointly own funds are diverted from an account by one co-owner, the other may well be entitled to pursue an equitable remedy.
The joint tenancy of the bank account was severed when the co-owner transferred the sale proceeds to herself and her husband, while the other co-owner of the account was still alive.