3.2 Forms of Ownership

• Library: Estate Planning in Virginia (Virginia CLE) (2018 Ed.)

3.2 FORMS OF OWNERSHIP ¹

3.201 Fee Simple. In Virginia there are a variety of ways that an individual may own real and personal property. Perhaps the most basic form of ownership is fee simple, where the individual owns all interests, both legal and equitable, in the property. If the individual dies without a will, the property owned in fee simple passes to his or her heirs (in the case of real property) or distributees (in the case of personal property) under the Virginia laws of descent and distribution. If an individual dies with a valid will, the beneficiaries under the will take the property in accordance with the directions in the decedent's will. In some cases, the individual may have transferred property during his or her lifetime to a trust or may have provided in a will that one or more trusts are to be established at his or her death. In such cases, the beneficiaries of the trust may be entitled to property or the income from property owned by the individual at death in fee simple, according to the terms of the governing trust document.

3.202 Tenants in Common. There are various forms of property ownership where more than one individual has ownership interests in the same property. In a tenancy in common, two or more individuals own undivided

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interests in property. Although the presumption, absent language to the contrary, is that all tenants in common own equal undivided interests in the property, the operative agreement—which is usually a deed—may specify the ownership interest of each of the tenants in common. When a tenant in common dies, the share of the property that he or she owns will pass to his or her heirs or distributees, if the tenant dies without a will, or to his or her beneficiaries, if the tenant dies with a valid will. A tenant in common has the right to have the property partitioned in a court proceeding in which the property would be divided among the tenants according to their respective interests. But if the property is not physically divisible (as is often the case with real property), the court can direct that the property be sold and the proceeds divided among the tenants.

3.203 Joint Tenants with Right of Survivorship. Another form of multiple-party ownership is joint tenancy with right of survivorship. Under common law, a joint tenancy was presumed to be a tenancy with right of survivorship. Under current Virginia law, except where the joint tenants are a married couple, joint tenancy is deemed to be...