This Decision Can Change People’s Lives!
If you are about to purchase a property or already own a property, you may have been asked this question about whether you wish to own the property as joint tenants or tenants in common.
Under a joint tenancy, if one of you dies, your “share” of the property automatically passes to the surviving joint tenant without reference to your Will. It generally cannot be challenged in any claim against the estate, although there are exceptions (e.g. in notional estate claims in NSW). Most couples own property in this fashion but many do not realise its full implications.
If you own property as tenants in common, your share of the property does not automatically pass to the surviving co-owner and can be dealt with by your Will. This way of holding a property is most commonly used where a couple wants to protect their surviving spouse or co-owner from future relationships or “predators”. Another common example is where a couple have children from previous marriages and wish to make sure that their half share of the property goes to their children or their side of the family.
For existing property owners who are considering reviewing or having their Wills prepared, it is often overlooked by lawyers who practice in this area and the Public Trustee. We have seen many cases where Wills have been drafted leaving someone’s “half share” of a property to a designated beneficiary, only to find that their wishes have been thwarted by owning the property as “joint tenants”.
It is becoming more common for people to sever their joint tenancy and allow their spouse or co-owner a life tenancy or right to occupy the premises for their lifetime and then the half share of the property will pass to their side of the family, children, grandchildren etc. This helps to stop the harsh effects of families being deprived of their inheritance due to the black and white nature of a joint tenancy. There are many stories of an elderly parent remarrying or re-partnering late in life, only to see the family home pass on to a spouse or partner who has only been with the deceased parent for a short period of time and did not contribute anything financially to the property.
We strongly advise our clients to carefully check their current tenancy that they own their property in and use this as an opportunity to review their Wills and estate planning generally. For those of you who are considering buying property, it is a very important and often overlooked point that should be discussed before you settle your purchase.
Attwood Marshall have a dedicated specialist team of estate planning lawyers that deal in this area on a regular basis and can provide you with the most accurate and sensible advice with respect to this important issue. Please take advantage of our obligation free appointment to discuss your estate planning generally. This free appointment will entitle you to a 30 minute free consultation with one of our specialist lawyers.
Please ring our department manager Donna Tolley on direct telephone 07 5506 8241 or freecall 1800 621 071 or email dtolley@attwoodmarshall.com.au to take advantage of this offer. Please feel free to pass on our newsletter to any of your family, friends or colleagues who may wish to take advantage of this opportunity.
