14 15 does a mortgage by one joint tenant sever lyons

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15 DOES A MORTGAGE BY ONE JOINT TENANT SEVER?: LYONS V LYONS 1. McInerney J: a legal mortgage at general law severs because the legal fee simple is transferred to the mortgagee, breaking the unities of time and title 2. But a Torrens mortgage operates as a charge, not a transfer Sec 74(2) TLA provides that a mortgage ‘shall when registered have effect as a security and be an interest in land, but shall not operate as a transfer of the land thereby mortgaged 3. So a Torrens mortgage by one JT does not sever THE EFFECT OF A MORTGAGE BY ONE JOINT TENANT: LYONS V LYONS 1. Mortgage only encumbers (ie,burdens) the interest of the mortgaging co-owner. When he dies, his interest disappears. 2. Surviving JT takes free of the mortgage. 3. Mrs L was entitled to call on the mortgagee to discharge the mortgage 4. Mortgagee lost its security (property interest) but could recover the debt from Mr L’s estate, as mortgage was a K. HOWEVER, there’s nothing left of Mr. L’s estate to recover from. DOES GRANT OF A FIXED TERM LEASE BY ONE JT SEVER? FRIEZE V UNGER 1. J and H Frieze were reg’d as JTs of a property. J occupied under an agreement with the Ungers (held to be a licence) 2. Scholl J: A lease by one JT does not sever, but suspends the joint tenancy for the duration of the lease. WHY? Because if this didn’t happen, two competing interests (the lessees right to exclusive possession, as well as the co-owners uninhibited access to the land) would be left unresolved. 3. When lessor dies, the lease continues and the rent is due to the lessor’s estate 4. When lease expires, the joint tenancy resumes, principle of survivorship operates and H takes as sole owner. POSITION BETWEEN THE LESSEE AND THE NON-LEASING JOINT TENANT 1. Scholl J said that during the lease, H cannot exclude the Ungers from any part of the property. As J’s tenants, they are exercising J’s right as co-owner to possession. Nor can the Ungers exclude H. 2. Same applies if H also grants a lease to other parties. SEVERANCE BY MERGER 1. Assume A has a life estate, B and C an interest in remainder as joint tenants. 2. A transfers her life estate to B. 3. A’s life estate passes to B and merges with B’s interest in remainder. 4. B and C now hold as tenants in common. SEVERANCE BY MUTUAL AGREEMENT 1. Needs to be an express agreement to sever 2. Agreement can be written or oral 3. It does not have to be specifically enforceable. 4. Not necessary to have agreement as to precise allocation of the proceeds of sale. 5. Severance can be effective immediately even if the sale and division of the proceeds are subject to a contingency that might or might not occur: Public Trustee v Pfeiffle SEVERANCE BY COURSE OF DEALING 15
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16 1. ALL ABOUT CONDUCT 2. No need for express agreement to sever 3. Parties conduct their dealings on the assumption that they hold distinct shares.
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