How to Sever a Joint Tenancy in California?
Joint tenancy and tenancy in common are very common ways to hold title to property in California by two or more persons, and knowing how to sever a joint tenancy is important to avoid the affects of joint tenancy on the title when one of the persons die.
The recent case of Pearce v. Briggs was a probate matter involving two groups of rival claimants regarding two parcels of real property in Bakersfield. Each group of claimants filed a petition to establish their claims on the properties, and opposed the petition filed by the other group.
Both petitions were tried concurrently in a bench trial, resulting in a ruling and judgment in favor of one group of claimants as to both properties.
The trial court denied the Pearce Petition on multiple grounds, including:
1. Ruth’s will did not sever the joint tenancy held by Ruth and Jack in the Gibson property;
2. Ruth’s estate did not have an interest in the Rosedale property;
3. The claims relating to Ruth’s interest in the Briggs Oil Co. partnership were barred by the statute of limitations in Code of Civil Procedure section 338; and
4. All claims seeking to recover interests in the Gibson and Rosedale properties were barred by the statutes of limitation in sections 318 and 319.
The Pearce Parties contended that Ruth’s 1983 will severed the joint tenancy between Ruth and Jack as to the Gibson property, rendering Ruth and Jack tenants in common as to that property.
The trial court ruled that as to the Gibson property, Ruth’s Will did not sever the joint tenancy in the property. The court also found no substantial evidence to support a conclusion that Jack and Ruth agreed to hold the property as community property.
On appeal, the Pearce Parties noted that the severance of a joint tenancy converts the form of co-ownership to a tenancy in common allowing Ruth to dispose of her half by will.
The parties agreed that Ruth and Jack acquired the Gibson property as joint tenants in 1959. The distinctive aspect of joint tenancy is the right of the surviving joint tenant to succeed to the interest of the deceased tenant.
The deceased joint tenant’s interest in the property held in joint tenancy vests automatically in the surviving joint tenant by operation of law. Nothing ‘passes’ from the deceased joint tenant to the survivor; rather, the survivor takes from the instrument by which the joint tenancy was created.
The fact that Ruth and Jack held title to the Gibson property as joint tenants was established by a written instrument in the form of a grant deed that was admitted as an exhibit at trial.
Turning to Ruth’s 1983 will, the parties agreed the will was never probated and its legality as a will was therefore never established.
A probate court has no power to consider the legality of a will until it was regularly brought before it by a petition for its probate.
In filing an affidavit of death of a joint tenant with respect to the Gibson property, Jack placed in the real property record the fact of Ruth’s death and thereby satisfied a condition subsequent in the relevant instrument, the joint tenancy deed, under which the joint tenants had acquired their interest.
As of the time of Ruth’s death in 1988, the law provided that an unrecorded will could not serve as a severance of a joint tenancy.
There is a rebuttable presumption that upon the death of a spouse, the character of real property owned by the couple is as set forth in the deed.
To rebut the presumption, the opposing party must show that the character of the property was held differently, including by establishing that the property’s character was changed by an agreement or mutual understanding between the spouses.
However, there must be an agreement of some sort; the presumption may not be overcome by testimony about the hidden intention of one spouse, undisclosed to the other spouse at the time of the conveyance.
Here, there was insufficient evidence that at the time they acquired the Gibson property, Jack and Ruth mutually agreed to hold the property as community property, or that Jack consented to transmute the Gibson property from joint tenancy to community property.
The Pearce Parties challenged the trial court’s ruling as to the Gibson property by arguing that Ruth’s 1983 will, severed the joint tenancy in the Gibson property as of the time of execution of the will in 1983. They argued that a will can have a dual character in that it may be a will and something else at the same time.
They further argued that Ruth’s will must be interpreted such that it severed the joint tenancy in the Gibson property immediately upon execution of the instrument in order to permit the will to dispose of Ruth’s property under the will. They point out that a testator has no power to dispose of joint tenancy property by a will.
The Pearce Parties’ argument has a surface appeal, but it did not withstand scrutiny. The operative language in Ruth’s will is as follows: “I declare that for convenience or through inadvertence title to some property owned by myself and my husband may be held of record in the form of joint tenancy, but that all such property is in fact intended to be our community property.”
This language does not reflect a clear and unequivocal intent, on Ruth’s part, to sever the joint tenancy in the Gibson property at the time of execution of the will.
A will that unilaterally purports to sever a joint tenancy encompasses the potential for fraud or duplicity, which is the precise concern that arose here.
The operative language in Ruth’s will appears to be mere boilerplate designed to protect her whether she predeceased Jack or whether Jack predeceased her. The vagueness of the language, and the fact that it was included in a will (or an ostensible will), appears designed to ensure that, were Jack to predecease Ruth, Ruth would not be precluded, upon filing an affidavit of death of joint tenant, from gaining title to any property jointly held by Ruth and Jack under a joint tenancy deed.
The Pearce Parties pointed to Civil Code section 683.2, subdivision (a)(2), which authorizes a joint tenant to unilaterally sever a joint tenancy by executing a written instrument evidencing such intent.
In 1985, the Legislature amended Civil Code section 683.2 to impose an additional requirement, i.e., recordation, for written instruments executed to sever joint tenancies.
Specifically, the Legislature added Civil Code section 683.2, subdivision (c), which provides, that severance of a joint tenancy of record by deed, written declaration, or other written instrument is not effective to terminate the right of survivorship of the other joint tenants as to the severing joint tenant’s interest unless one of the following requirements is satisfied:
(1) Before the death of the severing joint tenant, the deed, written declaration, or other written instrument effecting the severance is recorded in the county where the real property is located.
(2) The deed, written declaration, or other instrument effecting the severance is executed and acknowledged before a notary public by the severing joint tenant not earlier than three days before the death of that joint tenant and is recorded in the county where the real property is located not later than seven days after the death of the severing joint tenant.
By the time Ruth died in 1988, the requirements of Civil Code section 683.2, subdivision (c) were in effect. Thus, to the extent Ruth’s will severed the joint tenancy in the Gibson property upon her death in 1988, the severance was ineffective because the will was never recorded with the County of Kern, as required for purposes of severing a joint tenancy under Civil Code section 683.2, subdivision (c), at the time.
There was no evidence of an agreement between Ruth and Jack to sever the joint tenancy and transmute their interest in the property to community property; thus, the presumption established by the Civil Code section 683.2, subdivision (a) had not been rebutted.
Nor did Ruth’s will serve to rebut the presumption of joint tenancy established by the joint tenancy deed. Fact that one party expresses intent in will to convert or transmute character of property does not rebut presumption raised by form of deed.
Code of Civil Procedure section 321 was also applicable here and there is a presumption that the person with legal title also has possession of the property and is the beneficial owner.
The presumption may only by overcome by clear and convincing evidence that the objecting party has superior title or has obtained title by adverse possession.
Evidence Code section 662 provides that the owner of the legal title to property is presumed to be the owner of the full beneficial title. This presumption may be rebutted only by clear and convincing proof.
Under Evidence Code section 662, a presumption exists that Jack, and thereafter his trust, as the owners of legal title to the Gibson property, were also the owners of the full beneficial title to the property. The Pearce Parties did not claim, nor was there any evidence, that they held the property by adverse possession.
The Pearce Parties also did not adduce any evidence, other than Ruth’s 1983 will, to overcome the presumption. The Pearce Parties therefore failed to rebut the presumption established by Evidence Code section 662 that, as the holders of legal title to the Gibson property, Jack, and thereafter his trust, were also owners of the full beneficial title to the property.
Since the trial court correctly concluded that Ruth was not a tenant in common of the Gibson and Rosedale properties, its further conclusion that the Pearce Parties’ real property claims were time barred under sections 318, 319, and 321, was in turn correct.
Section 318 provides: “No action for the recovery of real property, or for the recovery of the possession thereof, can be maintained, unless it appear that the plaintiff, his ancestor, predecessor, or grantor, was seised or possessed of the property in question, within five years before the commencement of the action.”
Section 319 provides: “No cause of action, or defense to an action, arising out of the title to real property, or to rents or profits out of the same, can be effectual, unless it appear that the person prosecuting the action, or making the defense, or under whose title the action is prosecuted, or the defense is made, or the ancestor, predecessor, or grantor of such person was seised or possessed of the premises in question within five years before the commencement of the act in respect to which such action is prosecuted or defense made.”
Section 321 provides: “In every action for the recovery of real property, or the possession thereof, the person establishing a legal title to the property is presumed to have been possessed thereof within the time required by law, and the occupation of the property by any other person is deemed to have been under and in subordination to the legal title, unless it appear that the property has been held and possessed adversely to such legal title, for five years before the commencement of the action.”
The trial court found that the Pearce Parties’ claims were time barred under sections 318 and 319, and the appellate court affirmed.
LESSONS:
1. The severance of a joint tenancy converts the form of co-ownership to a tenancy in common.
2. The distinctive aspect of joint tenancy is the right of the surviving joint tenant to succeed to the interest of the deceased tenant.
3. The deceased joint tenant’s interest in the property held in joint tenancy vests automatically in the surviving joint tenant by operation of law. Nothing ‘passes’ from the deceased joint tenant to the survivor; rather, the survivor takes from the instrument by which the joint tenancy was created.
4. Civil Code section 683.2, subdivision (a)(2), which authorizes a joint tenant to unilaterally sever a joint tenancy by executing a written instrument evidencing such intent.
5. In 1985, the Legislature amended Civil Code section 683.2 to impose an additional requirement, i.e., recordation, for written instruments executed to sever joint tenancies.