Co-owners’ Rights & Duties

Relationship of Co-owners

Unity of possession is one of the key elements of co-ownership. It follows that each co-owner is entitled equally to the possession and use of the property.

The long-standing common law position is that one co-owner can occupy the entire property, to the exclusion of the others. Other co-owners who have not exercised like rights, do not have the right to compensation under common law in the absence of an “ouster” from the property.

Each co-owner is entitled to use and occupy the entire property. Any co-owner is entitled to enjoy the whole of the property. The mere non-occupation by a co-owner does not entitle him to rental payments from other co-owners who do use and occupy the property.

Ouster / Exclusion

However, if there is an ouster, now an “exclusion”,  this changes the position.Ouster implies a positive deliberate exclusion from the property.If, however, the co-owner uses it to such an extent as to effectively make it unavailable to the other co-owner, then this might amount to an unlawful ouster of the latter.

Ouster implies a positive and deliberate exclusion of the other from property or refusal to let him or her exercise rights of possession. In these circumstances, an occupational rent may be paid. Ouster may include changing the locks and other acts of exclusion. It would be likely to include a refusal to let the other take possession.

Actions which may cause inconvenience the other would not of themselves constitute an exclusion or ouster. Acts that damage or destroy property may in some cases, constitutean ouster.

Many of the cases in the area of co-ownership on which the principles mentioned above are based are very old. Many relate to circumstances significantly different to those found in modern times.

Ouster/ Exclusion Issues

Modern cases allow for the concept of constructive ouster. This may arise where there is effective exclusion by reason of the behaviour or conduct of the other co-owner,  preventing shared use and enjoyment of the property.

Mere animosity between the parties does not appear to be enough. Behaviour that causes intolerable living circumstances physical or mental distress such as to force the other party out, may suffice.   A co-owner who leaves voluntarily and would be able to come back is probably not ousted. However, if there is any actual or threatened violence, there is more likely to be ouster.

A spouse or partner who obtains a barring or safety order does not oust the party excluded. The refusal of consent to sale does not by itself, constitute an ouster.

Some cases suggest that the breakdown of relationships such that it is not possible for persons to live together may constitute an ouster even in the absence of fault. These cases have been criticised as going beyond the concept of ouster as understood at common law.

Some cases in other jurisdictions have given support for the possibility of an occupation rent even in the absence of ouster.

2009 Act Restatement

The 2009 Act allows for the possibility of compensation to be paid by a co-owner to another co-owner who has incurred disproportionate expenditure in respect of the land. This  includes

• its repair or improvement
• contributions by a co-owner to disproportionate payments made by the other co-owner in respect of the land including
• payments in respect of charges rates rents taxes and other outgoings
• redistribution of rents and profits received by a co-owner disproportionate to his or her share any
• other adjustment necessary to achieve fairness between the co-owners.

These principles appear to restate the equitable principles mentioned above in relation to accounting and accounting adjustments. It appears to go further than the earlier legislation by allowing the court to make adjustments necessary to achieve fairness between the co-owners.

In some cases, disproportionate expenditure might be sufficient to find a resulting trust giving the owner concerned a greater share in equity.

2009 Act Restatement

The fact that exclusively or predominantly enjoy the lands, to an extent short of ousting or exclusing his co-owners, may operate unfairly on thoses co-owners.  Legislation at the start of the 18th century provided joint tenants and tenants in common with a right of action for account against other co-owners who received more than their share of rents or other revenue from the property.

This was interpreted to refer to rents and profits received from third parties and not to imply an occupational rent  payable by the co-owner in possession. The 2009 Act is in similar, but more modern terms.

A co-owner who receives more than his fair share of the rents and profits of the property must account for the excess to his fellow co-owners.   Where one co-owner acts on behalf of his other co-owners as an agent, or if they are partners, there are fiduciary duties to account to each other. These duties bring enhanced obligations.

The 2009 land law reforms make provision for an application to the court, by which a co-owner can apply for an adjustment, which requires that a co-owner who has benefited, is required to account to his follow co-owners for the benefit received. The co-owner may also apply to the court for an order for partition or sale. If his co-owner has acted unreasonably, this is more likely to be granted.

On the face of it, the court has significant discretion to do justice between the parties. It is not clear whether 2009 Act has changed the substantive rules and principles significantly, which have evolved by the courts over time.The 2009 Act appears to restate the older statute law and the principles of equity providing for accounting adjustments between the parties.On one  view, the 2009 legislation does not change the existing law but provides a procedural remedy.

The 2009 Act S.31 refers to the possibility of accounting adjustments to provide for payment of an occupational rent by a co-owner who has enjoyed or is continuing to enjoy the occupation of the land to the “exclusion” of any other co-owner, and “any other adjustment necessary to achieve fairness between the co-owners.”  This latter provision may be interpreted more widely than ouster or exclusion. Courts may be tempted to interpret the apparently broad power to do justice and create a fair and reasonable outcome ,as justifying compensation or occupational rent on a more liberal basis than before.

Adverse Possession

The common law position is that one co-owner could not acquire adverse possession (squatters rights)  under the statute of limitations against the other. This was reformed so that the statute of limitations now provides in effect that one co-owner is no longer bailee or a representative of the other owners so that it is possible in principle that he may acquire title by adverse possession against the other.

The statute of limitations permits a co-owner to acquire title adverse possession against his or her co-owners. This may be raised by way of defence in any relevant proceedings including proceedings for account, sale or partition.

In many such cases, the posiession may not in fact be adverse in the circumstances. There may be a thin line between permitting a co-owner to posssess the property and acquiesence and failure to object.

Outgoings

Under common law, a co-owner could not require other co-owners to contribute towards repairs and improvements even if they benefited all co-owners. If one co-owner was an exclusive possession, the courts regarded it as fair that he would bear the cost of expenditure on the property.

The 2009 Act provides for an accounting adjustment by a co-owner to disproportionate payments made by any other co-owner in respect of the land (including payments in respect of charges, rates, rents, taxes and other outgoings payable in respect of it).

Other co-owners may take an action for waste where the property is damaged or destroyed. It appears that expenditure that arises from a legal obligation such as property tax and rates paid by one co-owner entitled him to a contribution from other co-owners. This is on the basis that there was created a joint liability by statute.

In addition to the statutory provision, the courts of equity exercised power to take accounts as between co-owners, where there was an imbalance in payments and receipts. Adjustments could be made between the parties. This might commonly take place in the context of an order for partition or sale or in the context of continued co-ownership. After 1877, all courts could exercise such rights.

Mortgage Payments & Insurance

The principle of improvements did not apply to mortgage payments and other contractual obligations. Generally, each co-owner is jointly and severally liable. Therefore if one co-owner pays more than his due share, he is entitled to contribution from the others under general equitable principles and the Civil Liability Act.

There have been different approaches to payments of insurance expenses. It may depend on the type of insurance and the circumstances. Some types of insurance may be necessary, while others may be desirable. It is rare that there is a legal liability to insure; it is usually a matter of prudence.

In some cases, insurance has been treated as an improvement whereas in other cases, it has been more akin to a joint debt. Where the co-owners are joint policyholders there will generally be a joint liability with a right of contribution under the above-mentioned equitable or statutory principles.

Improvements

The general principle is that co-owners who spend money by way of repairs and improvements while the property is enjoyed in common, get no credit or allowance for this expenditure. Co-owners must generally act collectively in relation to the property.

Where one co-owner has incurred substantial expenditure on improvements prior to a sale under the earlier pre-2009 law, cases supported the possibility of a credit being allowed in the context order for partition of sale.   Those prinvciples are likely to continue under the new law.

In the context of partition or sale, it appears that where improvements have been made for the purpose of increasing value in that context, an allowance may be made for those repairs and improvements. This is provided that the other co-owners are not worse off.

The scope of this principle at common law was controversial and it appears only operable in the immediate context of a sale of partition. It is not otherwise available.  Periodic payments and repairs were not covered under this principle. There would have to be a significant improvement. Payments that benefit the co-owner in a personal capacity were not covered.

If the improving co-owner occupies the property under a tenancy, he could not claim for repairs and improvements that are part of his tenancy obligations. If he leased the property to another without the consent of the co-owners and carried out necessary repairs, they were not recoverable.

In some cases, where the parties in possession claimed on the basis of having made improvements, an occupational rent was imposed on them by the courts as a quid pro quo. It is also argued in some cases that a court might apply an occupational rent to a sole occupier where he claims for joint outgoings. This is on the basis of the general principles of equity and in particular the principle that he who seeks equity must do equity.

In the limited circumstances where an allowance might be made, it could not be more than the amount expended. An allowance might be made for inflation and costs. However, the majority opinion appeared to be that it could not generally be the amount by which the value was increased, if greater.

Enhanced Obligations

In some cases, land may be occupied by a co-owner as a tenant of the other co-owners under a lease. In this case, rent will be payable under the lease in respect of such use.

Partners and agents must act in good faith respectively to fellow partners and  in the case of agents to persons on whose behalf they act. In this case, they may be liable to the other co-owners for poor management, negligence or wilful neglect.

Partnership or agency will not be established merely because the property is left in one owner’s hands. Something closer to an agreement that one shall manage on behalf of the other or a specific assumption of responsibility must be present before these additional duties arise.

Waste / Damage

The concept of waste applies generally where owners have different interests in one property. Co-owners may bring an action for damages for waste or seek an injunction restraining waste. An action for account under section 31 of the 2009 Act may also be used.

Waste in this context is something that tends to damage or destroy the common property. The normal use of the property would not comprise waste. Cutting down trees and working mines would not constitute waste if they are part of the normal use of the property.

What constitutes waste depends on the circumstances. In a case where one of a number of co-owners of property with gravel deposits had extracted commercial quantities in defiance of protests from the others, there was a duty to account for the profits so earned from such exploitation to the extent that they exceeded the proportionate area of the whole owned by the co-owner.

Relationship to Resulting Trust

The presumption when the property is placed in joint names or as tenants in common is that property is to be held in equal shares. This may be rebutted by showing an intention to the contrary. This intention may be imputed by the court after the event with reference to the circumstances at the time. It might be possible to show that the placing of the property in joint names is for another purpose in which event, there may be a tenancy in common in shares which reflect the parties’ putative common intention as determined or surmised by the court.

Where one co-owner ceased to make contributions to the mortgage and outgoings their beneficial share may be held to be adjusted accordingly. Where there has been a breakdown of relationships or rupture, the courts in the UK have been willing to find that the common intention when the property was purchased as joint tenants no longer applies so that the shares may begin to be held differently in equity.

References and Sources

Primary Texts

Wylie on Irish Land Law Wylie 6th Edition 2020

Land Law In Ireland -Lyall 4th Edition 2018

Principles Of Irish Property Law de Londras 2nd Edition 2011

Equity and the Law of Trusts in Ireland- Keane 3rd Edition

Land Law Kenna & Murphy 2019

Land Law Pearce & Mee 3rd Edition 2011

Other Irish Sources

The Land and Conveyancing Law Reform Act 2009: Annotations and Commentary -Wylie 2nd Edition 2017

Property Legislation 2009 2011 Cannon, Clancy, Kenna 2012

Irish Land Law – A Casebook: Adanan Maddox 2020

A Casebook on Equity and Trusts in Ireland – Wylie

Shorter Guides

Land Law Nutshell Cannon 2020

UK Textbooks

Land law C. Bevan 2nd ed.2020

Land Law: Text, Cases and Materials B McFarlane, N Hopkins and S Nield, (4th ed. OUP 2018)

Property Law R Smith(10th ed., Pearson, 2020)

Cheshire and Burn’s Modern Law of Real Property by Burn, E. H. 2011

Modern Land Law Dixon 2018

Elements of Land Law Gray, 2009

Property law: cases and materials Smith 2015

Land law Cooke 2015

The Limitation of Actions, 2nd ed Brady and Kerr 1994

Limitation of Actions Canny 2016

 

Co-Ownership of Land: Partition Actions and Remedies – Conway

Compulsory Purchase and Compensation in Ireland: Law and Practice – Galligan and McGrath