Transcript Co-ownership Cameron Stewart (thanks to Jim Helman and Shae

Co-ownership
Cameron Stewart
(thanks to Jim Helman and Shae
McCrystal – errors are mine)
(c) Cameron Stewart
Joint Tenancy
In a joint tenancy each of the joint tenants has an
entitlement to the whole property. There is no
distribution of any particular share of the
property to any of the joint owners and no joint
owner can say that any part of the property
belongs to that joint owner.
The 2 features that characterise a joint tenancy and
separate it from a tenancy in common are:
• The four unities
• •The right of survivorship
(c) Cameron Stewart
Unity of title
• The interests of joint tenants must be created
in the same instrument or dealing. It is not
possible to create a joint tenancy between coowners who acquire their interests by
separate instruments or dealings. The creation
of interests by separate instruments or
dealings results in the creation of a tenancy in
common.
(c) Cameron Stewart
Unity of title
• The interests of joint tenants must be created
in the same instrument or dealing. It is not
possible to create a joint tenancy between coowners who acquire their interests by
separate instruments or dealings. The creation
of interests by separate instruments or
dealings results in the creation of a tenancy in
common.
(c) Cameron Stewart
Unity of possession
• This requires that the co-owners be entitled to
possession of the whole property, to be
enjoyed together with the other co-owners.
• There is no claim for any particular part of the
land.
(c) Cameron Stewart
Unity of time
• This requires that the interests of all joint
tenants vest at the same time. This is usually
satisfied if the interests are created at the
same time.
(c) Cameron Stewart
Right of survivorship
• This is an essential feature of a joint tenancy. If there is no right
of survivorship then there cannot be a joint tenancy. If a joint
tenant dies then the property remains in the ownership of the
other joint tenants because they have always been entitled to
the whole property.
• Rather than saying that a surviving joint tenant has acquired the
interest of the joint tenant who died, it is perhaps more correct
to say that the interest of the joint tenant who dies has been
extinguished. The interest of a deceased joint tenant is no
interest at all, and there is nothing that forms part of the estate
of the deceased joint tenant.
• The right of survivorship in the surviving joint tenant cannot be
defeated by the joint tenant who dies leaving his or her interest
by will.
(c) Cameron Stewart
Corporations?
• Section 25 of the Conveyancing Act provides
that Corporations can hold interests as joint
tenants. If the company is dissolved then the
right of survivorship comes into effect.
(c) Cameron Stewart
Who dies first?
• Section 35 Conveyancing Act provides that where
it is impossible to tell, the older person dies first
and the younger dies second.
• There are exceptions to the section.
– Only applies to title to property.
– Only raises a presumption, rebuttable by evidence
that the deaths occurred in a particular order, not
according to seniority.
– Only applies where the death of the person is known
to have occurred, and is not presumed.
(c) Cameron Stewart
Who dies first?
• In Hickman v Peacey [1945] AC 304 a basement
air raid shelter was blown up by a high explosive
bomb. At the time of the explosion there were
five persons in the shelter as follows:(1) Mabel Price-Jones, 52, the occupier of the house;
(2) her daughter;
(3) Elizabeth Sarah Parke, 70, housekeeper for Randolph
Grosvenor;
(4) Randolph Grosvenor, 73, the first testator; and
(5) Edward Grosvenor, 66, the second testator
(c) Cameron Stewart
Who dies first?
• The difficulty in the case occurred because the Will of
(4) left property to (5) if he were “surviving at the date
of my decease” and also to (3). The Will of (5) left
property to (1), (2) and (3) if they survived him.
• The Court was asked to determine whether under the
English Law of Property Act 1925 the deaths occurred
“in order of seniority”. Cohen J at first instance held
that there was no evidence that they died
simultaneously and that they must be presumed to
have died in order of seniority. The Court of Appeal
reversed this decision, holding that their deaths were
simultaneous
(c) Cameron Stewart
Who dies first?
• The matter was then heard by the House of Lords. The
House of Lords held:
... that in the absence of such evidence (that is, evidence to show
whether any of the deceased had survived the others) they had
died in circumstances rendering it uncertain which of them
survived the other or others within the meaning of s184 of the
Law of Property Act 1925 and that accordingly in the
administration of their estates by the executors of the
respective Wills, the younger of the deceased should be
deemed to have survived the elder.
An inference, drawn from the facts, that they died simultaneously
would not make the section inapplicable and in any case would
not be justified on the facts disclosed.
(c) Cameron Stewart
Presumed dead?
• Halbert v Mynar [1981] 2NSWLR 659
• Charaus was made on presumption of death only. The
Grant stated “Deceased presumed to have died: On or after
7th June 1972.”. It was necessary to apply to the Court for
leave to distribute the Estate and for directions as to those
parts of the Will that should be complied with in those
directions.
• John Charaus was married once only to Emily Charaus in
about 1939 there being one child of the marriage, Blanka
Olga, born on 2 June 1945. Blanka married Mirek Mynar on
3 April 1971.
• On 7 June 1972, John Charaus and Blanka disappeared and
have not been seen or heard since.
(c) Cameron Stewart
Presumed dead?
• Waddel L J found that s.35 did not apply where one of the
deaths is presumed under the Common Law. He said:
• It is unlikely that the legislature intended the Section to
determine arbitrarily the order of death of persons whose
deaths may have been separated by many years.
• As John Charaus and Blanka disappeared in June 1972 and
Emily Charaus (John’s wife) died in October 1973, it is
difficult to see how the Court could have come to a
conclusion that he was presumed to have died between
June 1972 and October 1973 when there was no evidence
before the Court that he had died at all and the Grant of
Probate of his Will was made on the presumption of death
after a period of 7 years from June 1972 elapsed.
(c) Cameron Stewart
Tenancy in common
• In contrast to a joint tenancy, a tenancy in common has
the co-owners owning interests in the land in
proportion to their interest. If co-owners are tenants in
common in equal shares then they each own a one half
interest in the property.
• If they own unequal shares then they own the property
in the proportions they are stated as holding in the
property. Eg: three quarters/one quarter.
• The share of a tenant in common is said to be an
“undivided” share. It is a separate share but not a
physically divided share.
(c) Cameron Stewart
Creation of Co-ownership
• Before the Conveyancing Act 1919 the
common law presumed that a conveyance to
two or more persons created a joint tenancy.
This presumption could be displaced by
specific words such as “a one half interest to
each of A & B” , “to be divided equally” “to my
five sons equally”
• Rentoul v Rentoul [1944] VLR 205
(c) Cameron Stewart
Creation of Co-ownership
• Equity preferred tenancy in common
– Unequal contribution to purchase price
– Unequal contribution to mortgage liability
– Unequal contribution to business assets – the
right of survivourship has no place amongst
merchants
• Resulting Trusts
• Equity follows the law on a 50:50 input
(c) Cameron Stewart
Creation
• Section 26(1) of the Conveyancing Act provides
that:
• In the construction of any instrument coming into
operation after the commencement of this Act a
disposition of the beneficial interest in any
property whether with or without the legal estate
to or for two or more persons together
beneficially shall be deemed to be made to or for
them as tenants in common, and not as joint
tenants.
(c) Cameron Stewart
Delehunt v Carmody
• In Delehunt v Carmody (1986) 161 CLR 464
Francis Carmody and Ethel Delehunt contributed
equally to the purchase price of a property that
was registered only in the man’s name. They
agreed that the land would be owned in equal
shares and that at some time in the future it
would be put in both names. The matter came
before the Court after Francis Carmody died
intestate and letters of administration were
granted to Heather Carmody, his estranged wife.
(c) Cameron Stewart
Delehunt v Carmody
• At first instance Wooton J held that there was
a trust and that Francis Carmody held the
property upon trust for himself and Ethel
Delehunt as joint tenants in equity. On appeal,
the Court of Appeal disagreed and found that
there was a trust but that it was a trust for the
parties in equal shares as tenants in common.
(c) Cameron Stewart
Delehunt v Carmody
• The matter then came before the High Court
to consider the question “that the Court of
Appeal erred in holding that s.26 of the
Conveyancing Act 1919, as amended (NSW)
displaced the equitable presumption that
where two persons advance equally the
purchase monies for a property they hold as
equitable joint tenants”.
(c) Cameron Stewart
Delehunt v Carmody
• Gibbs CJ:
• It would be indeed surprising if the rules of equity
required the courts to follow a rule of the
common law that no longer existed and in doing
so to reach a result which equity generally tried
to avoid. However the doctrines of equity are not
so inflexible. If equity follows the law, it will
follow the rules of law in their current state.
(c) Cameron Stewart
Real Property Act 1900
100 Registered co-tenants
(1) Two or more persons who may be registered as
joint proprietors of an estate or interest in land
under the provisions of this Act, shall be deemed
to be entitled to the same as joint tenants
Inconsistency?
“registered” as joint tenants or registered as “joint
proprietors”
(c) Cameron Stewart
Rights between Co-owners
• Right to Possession
• Because co-owners have unity of possession,
each is entitled to occupy the whole land and
there is no concept of trespass by one co-owner
against another. However, if one co-owner ‘ousts’
the other co-owner (and we will see what this
means later) such that they deny a co-owners
right to possess the property, they can bring an
action in trespass seeking repossession of the
property - claiming that they have been ejected.
(c) Cameron Stewart
Rights between Co-owners
• It also follows that one co-owner cannot grant a right
of possession to another person that would exclude
the right to possession held by all the other co-owners.
So if for example one co-owner grants a lease, this
would not prevent the other co-owners from exercising
their right to possession unless they were also parties
to the lease. In this situation the co-owner has only
given the tenant the right of possession that they
themselves have – and that is a right to possession
which is shared with the other co-owners.
(c) Cameron Stewart
Rights between Co-owners
• Right to Value of Repairs / Improvements
• Where one co-owner voluntarily undertakes
repairs or improvements to a jointly owned
property they cannot force the other coowners to contribute to those repairs or
improvements unless they have reached
agreement on the repairs or improvements
first.
(c) Cameron Stewart
Rights between Co-owners
• In Leigh v Dickeson (1884-1885) LR 15 QBD 60, a co-owner who
was in possession of jointly owned property expended monies
on repairs. The co-owner then sought a contribution to the cost
of those repairs from his co-owner. The court refused to grant
the request finding that there was no duty on co-owners to
repair their property – and that they could, if they chose, allow
the property to decay. The court said that if one co-owner makes
a purely voluntary payment, then the other co-owners are under
no legal obligation to reimburse them – even though the value
of their property is increased. To find otherwise would allow one
co-owner to force the other to expend monies against his or her
will. Note Lindley J at 69: “Tenancy in common is a tenure of an
inconvenient nature, and it is unfit for persons who cannot agree
among themselves”.
(c) Cameron Stewart
Rights between Co-owners
• Cotton, LJ:
As to the claim for improvements, it has been urged that no
tenant in common is entitled to execute improvements upon
the property held in common, and then to charge his cotenant in common with the cost. This seems to me the true
view, and I need not further discuss the question as to
improvements. As to the question of repairs, it is to be
observed that when two persons are under a common
obligation, one of them can recover from the other the
amount expended in discharge or fulfilment of the common
obligation; but that is not the position of affairs here: one
tenant in common cannot charge another with the cost of
repairs without a request, and in the present case it is
impossible even to imply(c)aCameron
request.
Stewart
Partition and adjustment
• The only remedy for the improving co-owner
would be to apply for an order of partition forcing
the sale of the property
• The court of equity would intervene in order to
make an adjustment of the property in favour of
the co-owner that spent money improving the
property.
• However, while the co-ownership exists, there is
no remedy and no right to get a contribution
towards the cost of improvements without an
agreement beforehand.
(c) Cameron Stewart
Equity is defensive
• The High Court in Brickwood v Young (1905) 2 CLR
387 per Griffith CJ at 396 noted that the equity
operates defensively – ie – it only arises at the
end of the co-ownership as a defence against the
other co-owners asserting their rights to their
pre-existing legal share without adjustment.
Equity steps in to prevent the co-owners who did
not contribute to the value of the repairs and
improvements from taking the increased value of
the property without having contributed to the
cost of those repairs and improvements.
(c) Cameron Stewart
Equity is defensive
• Brickwood v Young (1905) 2 CLR 387 per Griffith CJ at
396:
The principle appears to be that the making of
permanent improvements by one tenant in common in
sole occupation gives rise to an equity attaching to the
land, analogous to an equitable charge created by the
owners for the time being, but enforceable only in the
event of partition or a distribution of the value of the
land amongst the tenants in common. There can be no
reason why such a charge should not run with the land
in favour of purchasers from the person originally
entitled to it.
(c) Cameron Stewart
Equity is defensive
• In Brickwood co-owned land was compulsorily
acquired by the State. In distributing the value of the
estate one co-owner of the property sought
contribution from the other 3 co-owners for the value
of improvements done by that co-owners predecessor
in title:
• Ie A B and C own land; B does renovations. B sells his
portion to D. On sale of the whole or partition, D can
get a contribution for the value of the improvements
carried out by B. Why given that D didn’t pay for them?
Because presumably the price D paid for the land was
increased by the value of the improvements that B did
– so D in effect purchased B’s equity
(c) Cameron Stewart
What does the improver get?
• Upon sale of the property subject to coownership, the improving owner is entitled to
recover either the cost of the improvements
undertaken to the property OR the increased
value of the land attributable to those
improvements – whichever is the LESSER
amount
(c) Cameron Stewart
Boulter v Boulter
• Boulter v Boulter (1898) 19 LR (NSW) Eq 135 per Simpson CJ at 137:
• Where an owner of an undivided interest in land spends money on
improving the property so that on a sale .. it fetches an enhanced
price, a Court of Equity in dividing the proceeds of sale will not
allow the other co-owners to take their shares of the increased
price without making an allowance for what has been expended to
obtain that increased value … This course of action cannot inflict
any injustice on the other co owners, for it takes nothing out of
their pockets, it only prevents them putting into their pockets
moneys obtained by the expenditure of another person, unless they
recoup him such expenditure. In no case can the co-owner who has
improved the property obtain more than his outlay, though such
outlay may have trebled the value of the property. And, on the
other hand, the increase in the price obtained is the limit of what
he can receive, though his actual outlay may be far larger.
(c) Cameron Stewart
McMahon v Public Curator of
Queensland
• McMahon v Public Curator of Queensland [1952]
St R Qd 197 Macrossan C.J. referred to Leigh v
Dickeson and said:
• ... It is clear, I think from this, that the amount to
which a co-owner making improvements may be
entitle against another co-owner in taking the
accounts in a partition action, is limited to the
actual cost of the improvements, and if the
present value of the increment to the property is
less than the actual cost of the improvements, he
is further limited to that present value.
(c) Cameron Stewart
Squire v Rogers
• Squire v Rogers (1979) 39 FLR 106 : Squire and Rogers were cotenants of land in Darwin under a perpetual lease. The lease
required that in one year there be buildings on the land of a total
value of not less than $15,000.00. In June 1963 Rogers left Australia
and voluntarily left the land in the occupation of the Squire with the
expectation that Squire would spend the money necessary to
comply with the covenant contained in the lease. Squire did so by
constructing flats and other improvements and carried on a
business of providing accommodation in flats, rooms and caravans
and by letting caravan sites. Much was destroyed by Cyclone Tracy
but then Squire rebuilt. Rogers returned to Australia in 1976 and
commenced proceedings for the sale of the estate of the appellant
and the respondent and that an account be taken.
(c) Cameron Stewart
Squire v Rogers
• The defendant estimated that he had spent $100 000
on the property over the course of the 14 years. An
independent valuation estimated that the
improvements had only improved the value of the land
by $15 000 – so when the property was sold, he was
entitled to take $15 000 out of the proceeds before the
remainder was divided between the two co-owners. He
received nothing for his other $85 000 from his coowner. There is also an interesting aspect of this case
relating to rents and profits from co-owned land which
we will return to when we look at entitlement to rents
and profits.
(c) Cameron Stewart
Mortgage Payments
• Improvements are not limited to physical improvements and can include
mortgage payments because mortgage payments increase the equity in
the property and the amount available for distribution
• HW – if you want mortgages payments on dissolution then you must do
equity
• In Ryan v Dries [2002] NSWCA 3 (6 February 2002) the Court of Appeal
considered issues of accounting in respect of occupation, accounting in
respect of repairs, maintenance, and outgoings, including mortgage
repayments. Hodgson JA at [70] said:
• If a co-owner makes a claim for contribution to mortgage payments in
reliance purely on a legal right, with no reliance on equitable principles,
then it would seem that the co-owner is not seeking equity and is not
required to do equity. However, if the co-owner does rely on equitable
principles in making such a claim, in my opinion the co-owner is seeking
equity and is required to do equity, no less than if allowance for
improvements was being sought
(c) Cameron Stewart
Occupation Rent
• If one co-owner goes into occupation of the
property they are not obliged to pay rent or
an occupation fee to the other co-owners. This
is because co-owners are seised of the entire
estate and each has a present right to
possession of the whole property (along with
any other co-owner who chooses to occupy it
as well).
(c) Cameron Stewart
Occupation Rent
• Luke v Luke 36 SR (NSW) 310, John Luke died leaving
his estate subject to a life tenancy in favour of his
widow with the remainder to his two daughters in
equal shares as tenants in common. John Luke’s widow
died in 1915 and Laura, one of the daughters, died in
1920. From that date until the trial in 1936, Ada (the
other daughter) occupied the property. In 1929, Ada
was removed as a trustee of the estate and the Public
Trustee appointed. In 1932, Ada Luke became a
bankrupt and in the case before the Court an order was
sought that the Public Trustee be authorised to sell the
real estate and that Ada Luke be charged an occupation
rent.
(c) Cameron Stewart
Occupation Rent
• Long Innes C J in Eq. cited the matter as follows:
The conclusion to which I have come is that the
contention that the defendant Ada Luke should be
charged with an occupation rent in this case is neither
supportable on principle, nor established by authority,
and that , in fact, the balance of authority is to the
contrary.
I make the order for sale as asked, and declare that the
defendant Ada Luke is not chargeable with an
occupation rent.
(c) Cameron Stewart
Occupation Rent
• Three exceptions
– the co-owners have contractually agreed amongst
themselves that the occupying co-owner will pay a fee;
– One of the co-owners has been excluded from the
property through an ‘ouster’
– One of the co-owners has voluntarily expended money on
repairing or permanently improving the co-owned
property and has been in occupation during that time. If
they seek a contribution from the other co-owners
towards the repairs or permanent improvements, the
extent of this contribution will be reduced by an
occupation fee covering their occupation of the property
(c) Cameron Stewart
Ouster
• An ouster will occur when one co-owner
physically excludes or threatens to physically
exclude another of the co-owners. An ouster
must be wrongful and suggest that there is a
denial of the excluded persons title and right to
possession of the property. Exclusion will amount
to ouster where one party leaves due to violence
or threats of violence; or where one party asserts
that the other has no proprietary interest in the
property. No ouster occurs where one co-tenant
makes life difficult or uncomfortable for the other
(c) Cameron Stewart
Ouster
• Biviano v Natoli (1998) 43 NSWLR 695 – Ms Biviano and Mr
Natoli bought a house together in 1979 and lived in the
house until October 1992. In Oct 1992 they had an
argument, there were threats made, and Mr Natoli left. Ms
Biviano then got an Apprehended Violence Order under the
Crimes Act 1900 which prevented Mr Natoli from occupying
the premises. Mr Natoli subsequently took court action
seeking the sale of the house and an occupation rent from
the time of the AVO. Ms Biviano defended the action
claiming a. that she was the full owner of the house
(denying Mr Natoli was a co-owner) and in the alternative
b. that there had been no ouster entitling him to an
occupation fee.
(c) Cameron Stewart
Ouster
• The court dismissed the first argument and found that
they were tenants in common of the fee simple. With
respect to the issue of ouster, the court said:
The true nature of ouster is that it constitutes a
trespass by one co-tenant of another co-tenants rights
in respect of the property … ‘an express denial of the
title and right to possession of fellow tenants brought
home to the latter openly and equivocally’ would
clearly amount to an ouster (per Beazley JA at 701
(Powell JA and Stein J in agreement)
(c) Cameron Stewart
Ouster
• The court held that court order AVO did not constitute ouster.
Because Mr Natoli was not wrongfully excluded from the property
but was excluded pursuant to a statutory order, Ms Biviano had not
trespassed on Mr Natoli’s rights to the property. His lack of access
to the property came through a lawful AVO
• The court found that if Mr Natoli could not lawfully have sustained
an action in ejectment against Ms Biviano, she could not have
wrongfully excluded him.
• However there was an ouster in the case. The court found that an
ouster occurred when Mr Natoli lodged his claim for sale of the
house and she defended the action by alleging that he had no title
to the property. This action amounted to a denial of his proprietary
interest in the property and was an ouster – so she had to pay an
occupation rent for the period from the date of the court action.
(c) Cameron Stewart
Claim for mortgage payments
• Foregeard v Shanahan (1994) 35 NSWLR 206 – Co-owners of 50% of
land.
• She was in sole occupation for 9 years (judge notes – she ‘installed
her paramour’).
• During that time she made all the mortgage payments on a jointly
owed mortgage.
• He sought a partition to sell the house.
• She raised 50 % of the mortgage payments as a defensive equity in
partition.
• Her defensive equity was reduced by 50% of the rent the property
would have fetched over those nine years as an occupation fee –
this amount exceeded the mortgage payments – he sought the
extra
• He was denied on the basis that the occupation rent claimed
cannot exceed the defensive equity raised.
(c) Cameron Stewart
Claim for mortgage payments
Headnote says:
(2) (By Meagher JA with whom Mahoney JA agreed; Kirby P dissenting) In common law partition and similar
cases, the rights of one co-owner against another co-owner of real property, when one has been in
occupation and the other has not, include:
(a) the payment of an occupation fee by the co-owner in possession but only where:
(i) the other co-owner has been excluded from occupation; or
(ii) the owner in occupation claims an allowance in respect of improvements
(b) the entitlement to an allowance in favour of a co-owner in occupation who effects improvements
(which is more than mere repairs and maintenance) is for the lesser of the value of the enhancement
of the property and the cost of effecting the repairs, where the non-occupying owner seeks an
occupation.
(3) Accordingly, in determining the rights of joint tenants for the purposes of making orders pursuant to the
Conveyancing Act 1919, s 66G, where one owner has left the jointly owned property but has not been
excluded from occupation:
(a) insurance premiums and expenses for pest control incurred by the occupying co-owner cannot be
claimed as improvements which are recoverable from the other owner;
(b) an occupation fee should be charged to any occupying owner but the fee should not exceed the value
of improvements made by the occupying owner; and
(c) an allowance should be made in favour of the owner making mortgage repayments, water and council rates,
but such allowance arises from a claim for contribution for payments made by one debtor of a debt jointly
owed and not because of the co-ownership of real estate.
(c) Cameron Stewart
Calculation of occupation fee
• What are you paying an occupation fee for? The
occupation fee is to occupy the portion of the property
that the co-owner does not own. So, if one co-owner
has 50% of the property, then they have to pay half the
value of the occupation (because you don’t have to pay
to occupy your half). Equally, if the co-owner owns 1/3
of the house, then they have to pay an occupation fee
for their occupation of the other 2/3 of the property.
An occupation fee is generally calculated by reference
to the open market rental for the property – So, if a coowner owns 60% of the property, their occupation fee
will be 40% of the market rent.
(c) Cameron Stewart
Rents and Profits
• In equity, an account for profits lies as part of a suit for
partition.
• There is also an argument that the equity court can still
exercise an inherent jurisdiction for an account between
co-owners. If this jurisdiction still exists then the court can
order only an account of those profits received from third
parties. The fact that one co-owner has had a greater
benefit from actual occupation of the property does not
found an action.
• In an action for an account of profits, a claim for the cost of
improvements will be dealt with by the court making an
order for the whole of the cost of the improvements made
to earn the income.
(c) Cameron Stewart
Rents and Profits
• The general rule is that each co-owner is
entitled to share in the rents and profits of the
property in accordance with the size of their
respective shares in the property. (1/3 share =
1/3 rents and profits).
(c) Cameron Stewart
Rents and Profits
• Rees v Rees [1931] SASR 78, four brothers
owned a farm in equal shares as tenants in
common. Two of the four brothers farmed the
land and sought an order that they were
entitled to the whole of the produce from the
land and the money derived from that
produce and that they were not liable to
account for any portion thereof to the
defendants.
(c) Cameron Stewart
Rents and Profits
• The point raised by the defence in the present action; that in
farming the land the plaintiffs did so as trustees for themselves and
the defendants, is dealt with in the note in Lindley on p. 37, “nor
can one co-owner, by leaving the management of the property in
the hands of the other, impose upon him an obligation of a
fiduciary character.” The authority cited for this proposition is
Kennedy v de Trafford, [1897] A.C. 180 (see especially per Lord
Herschell at p. 189), which is cited by Collins M.R. in In re Biss,
[1903] 2 Ch. 40, at p. 57, for the statement that “tenants in
common do not stand in a fiduciary relation to each other.” There is
nothing in the circumstances of the present case giving rise to any
such relationship concerning the management of the farm or the
produce thereof, and it seems clear that the plaintiffs were entitled
to the declarations and order for which they asked.
(c) Cameron Stewart
Rents and Profits
• Back to Squire v Rogers (1979) 27 ALR 330. - The plaintiff sought an
account of the rent earned from structures built:
• The court agreed with claim for rent but if one party voluntarily
improves the land, and those improvements earn rents or profits,
you are only entitled to those rents and profits IF you are prepared
to pay for a share of the improvements (per Deane J (Brennan and
Forster JJ in agreement) at 348):
In my view, [the plaintiff] is … only entitled voluntarily to adopt the
benefit of the improvements [the rents and profits] by claiming and
receiving one-half of any profit resulting from their use at the price of
being liable to contribute to, or make an allowance in respect of, their
cost over and above the amount included in the restricted allowance
to which the defendant was independently entitled to on partition or
sale. If she accepts the benefit of the profit earned, she must bear her
share of the burden of earning it.
(c) Cameron Stewart
Rents and Profits
• Conclusion: the plaintiff couldn’t be made to pay for the
improvements beyond the fact that the defendant got a
$15 000 property adjustment to account for the
increased value of the land (remembering that he spent
$100 000);
• She could not then also seek to collect the rent and
profits that flowed from the improvements.
• Plaintiff was entitled to a one-half share of the rent from
the caravans for 14 odd years because the caravans stood
on unimproved land BUT she wasn’t entitled to a share of
the rent from the boarding rooms that the defendant had
constructed unless or until she forked out for the cost of
building them.
(c) Cameron Stewart
Rates
• Section 560 of the Local Government Act
provides that co-owners are jointly and
severally liable for the payment of rates. Also
applies where there are lessees.
(c) Cameron Stewart