Realism and Formalism in the Severance of Joint Tenancies

• Publication year: 2021

77 Nebraska L. Rev. 1. Realism and Formalism in the Severance of Joint Tenancies

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R. H. Helmholz*

Realism and Formalism in the Severance of Joint Tenancies

TABLE OF CONTENTS

I. Introduction .......................................... 1
II. Definitions ............................................ 4
III. Continuing Citation of the Four Unities ............... 6
IV. Rejection of the Four Unities Requirement ............ 9
A. Cases of Unilateral Self-conveyance ................ 9
B. Contracts to Sell and Equitable Conversion ........ 15
C. Divorce and Severance ............................ 20
D. Summary ......................................... 24
V. The Consequences .................................... 24
A. Added Difficulties in Determining Severance
Questions ......................................... 25
B. Increased Possibility of Fraud ..................... 25
C. Greater Incongruity with the Remaining Formal
Rules ............................................. 27
1. Void Deeds .................................... 27
2. Mortgages ..................................... 28
3. Wills .......................................... 29
4. Partition ...................................... 30
5. Bankruptcy .................................... 31
6. Leases ........................................ 31
VI. Conclusion ............................................ 32

I. INTRODUCTION

During the 1950s, a series of articles, comments, and case notes appeared in American law reviews dealing with the then-current law relating to severance of joint tenancies.(fn1) It is not too much to say that

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they echoed a single theme: The inherited law of severance was based upon a needless and outmoded formalism. The commentators concluded that the law ofseverance of joint tenancies had become "thoroughly burdened with concepts which might be described as archaic."(fn2)

In their eyes, the "troublesome doctrine of the four unities"(fn3) stood out as the worst offender. These four unities-time, title, possession, and interest-were traditionally used to decide whether there had been a severance. Unless they were broken, there could be none. That requirement seemed a particularly egregious example of the harm done by taking a purely formal approach to legal questions. It served to frustrate the legitimate expectations of too many joint tenants, and for no discernible purpose. To the commentators, the time seemed ripe for American courts to take a more realistic stance and to abandon the four unities outright. They advocated that courts look instead to the intent of the parties for the operative test of whether a joint tenancy had been severed and a tenancy in common created in its place.

In the years since the 1950s, the intent-based approach advocated by the law review commentators has been noted, mostly with approbation in treatises,(fn4) law reviews,(fn5) hornbooks,(fn6) and casebooks.(fn7) What

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has not been undertaken is any investigation of whether the case law itself has responded to the position taken in the articles. Academics issued a strong call for a more realistic approach to be used in deciding severance cases. But has any court answered their call?

At first sight, it appears that they have not. Judges and commentators today continue to speak of the four unities and the formalist approach they embody as stating the law applied in the majority of American jurisdictions.(fn8) The arguments advanced in the law reviews during the 1950s seem to have fallen upon deaf ears. The task of the present Article is to discover whether that conclusion is correct.

The Article also contributes to the discussion of the place of formal-ism in the law.(fn9) The relevance of the questions raised is not limited tothe subject of joint tenancies. Underlying the approach advocated in most ofthe early law review commentary is the conviction that purely formal norms that are out of step with current realities should be eliminated from the law wherever they can be. Taking that approach seriously has real, and continuing, implications in many areas of the law, and it is a subject on which many writers have strong views. The commentary from the 1950s was an eloquent statement of one possible consequence of taking the anti-formalist view. Within this particular area of law, and in a forceful way, it raised a large subject which was of significant interest to legal scholars and, indeed, to all thoughtful lawyers.

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II. DEFINITIONS

Joint tenancies and tenancies in common exist where estates in land or rights to chattels are held as a unit by two or more persons. The former are distinguished from the latter by the characteristic, traditionally called the ius accrescendi, which makes the joint tenant who survives the death of the other(s) the outright owner of all the prop-erty. Property held in common, by contrast, passes to each tenant's heirs or legatees. It is quite possible to move from a joint tenancy to a tenancy in common while retaining the other features of co-ownership. In fact, either tenant has the right to sever the joint tenancy, even without the consent or knowledge of the other tenant, and such a severance ends the ius accrescendi. However, it does not upset the undivided ownership in the tenancy in common that is created when severance occurs. Only a partition, accomplished by sale or physical division of the property, results in the parties holding separate interests in the property.

Although by no means legally so confined, joint tenancies are typically used by husbands and wives, or at least by members of the same family. Ties of kinship often create an interest in property that is joint in more than a technical sense, and this form of ownership accords well with those ties. It also permits the survivor to take by virtue of the original conveyance, rather than by inheritance at the death of the other tenant(s); very often this result is exactly what members of the same family desire. Among other advantages, joint tenancy avoids the expense and trouble of probate. Consequently, it would not be inaccurate to say that the joint tenancy is most widely used today as an alternative to a will.

The common law joint tenancy is very old, going back at least to the thirteenth century.(fn10) In its main features, it has exhibited a remarkable durability. As the preferred form of common ownership in earlier English law, the joint tenancy's existence was presumed over a tenancy in common in cases where there was doubt about which had been created. Despite widespread reversal of that presumption in modern American law, joint tenancies remain in frequent use. Indeed, there is some evidence to suggest that their popularity is actually growing.(fn11)

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The traditional test for the creation and continuation of a joint tenancy depended upon the presence of the four unities. Unless the uni-ties of time, title, interest, and possession existed at the tenancy's inception, or if they were broken at any subsequent point, the joint tenancy was automatically severed, and the owners became tenants in common. This requirement meant, for example, that the owner of property could not create a joint tenancy in himself and others without first making use of a straw man. Because all joint tenants had to receive their interest in the property at the same time and by the same title, the owner had first to convey to a third party, who would in turn convey the property back to the grantor and the other tenants. They would then take in joint tenancy. Without this purely formal step, however, they would be only tenants in common.

Today (as was already largely true in the 1950s), the necessity for using a straw man to create a joint tenancy has been largely eliminated from American law, sometimes by judicial decision (fn12) but more often by statutory enactment.(fn13) However, the situation as to termination of a joint tenancy has not been identical. In order to sever, the traditional rule has always required either that all the tenants make an express agreement to hold as tenants in common or that one of the tenants convey to a third person in order to destroy the unities. This

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means that, although any joint tenant has the unqualified right to sever the tenancy, thereby creating a tenancy in common in which the ius accrescendi disappears, if the joint tenant wishes to do so and continue to hold in common, he must first make use of the straw man. Otherwise, the four unities will not have been destroyed. The law review commentators found that requirement as incongruous as it was archaic. Indeed, its purely formalist approach seemed to have infected the law of severance at several points. They advocated its abolition. Calling for replacement of this formalist approach, commentators argued that the intent of the parties should control.

III. CONTINUING CITATION OF THE FOUR UNITIES

An initial examination of the cases decided in the intervening years tempts one to believe that nothing has changed in the interim. The four unities appear to occupy a central place in many judicial deci-sions. What judges have written often gives no hint that they have paid the slightest heed to the argument that the requirement has out-lasted any utility it may once have had. The four unities continue to be described as necessary parts of a joint tenancy. A Missouri case from the 1950s saw fit to stress that a joint tenancy's "essential ele-ments are the four unities of interest, title, time and possession."(fn14) A Pennsylvania case of 1991 used almost exactly the same language- "the four unities of a joint tenancy"-to distinguish it from a tenancy by the entirety.(fn15) In a 1983 case from West Virginia, the court spoke approvingly of "the four unities that are essential to the creation and maintenance of a joint tenancy."(fn16) And in a decision from the District of...