What Is A Notice Of Severance?
In his latest blog, Wills & Probate Solicitor Matthew Kelly discusses severance notices, what they are and how they affected a recent case….
Sometimes even the smallest mistake can have the grave consequences as was demonstrated in the recent case of Fantini v Scrutton & Ors [2020] EWHC 1552.
What Is A Notice Of Severance?
Where two (or more) people co-own a property they often hold the property as beneficial joint tenants which means that when one of them dies their interest in the property automatically passes to the surviving co-owner of the property. The interest of the deceased co-owner passes outside of their Will and automatically passes to the surviving co-owner.
Sometimes co-owners who hold property as beneficial joint tenants wish to change to tenants in common. Crucially, owning as tenants in common means the share of each co-owner, whether 50% or otherwise, can pass under a Will to a third party and doesn’t pass automatically to the surviving co-owner.
In order to change from beneficial joint tenants to tenants in common a notice of severance must be served on the other co-owner. Often the severing of the joint tenancy is done by mutual agreement of both co-owners. However, where one party wishes to sever the joint tenancy without agreement the notice of severance must be served on the other co-owner in a prescribed manner.
There are various acceptable methods of service and the service of the notice by registered post addressed to other co-owner at their last know place of business or abode is a common method. In the case of Fantini v Scrutton & Ors [2020] Gloria Fantini served notice on her mother Iris Fantini in this manner as Gloria was terminally ill and Gloria desired to hold the property as tenants in common so her share could pass under her Will. A few days after posting the letter by registered post Gloria’s solicitors confirmed to the Land Registry that the notice had been served on Iris and the Land Registry changed the Land Register to reflect Gloria and Iris held the property as tenants as common. The Land Registry quickly wrote to Iris advising her that a restriction has been placed on the Land Register and the property was now held as tenants in common. Within a week of the notice of severance being sent Gloria died.
However, a few weeks later the letter sent enclosing the notice of severance was returned to Gloria’s solicitors undelivered. A couple of months later Iris died. The issue was whether the notice of severance was successful meaning Gloria ½ share would pass under her Will to her beneficiaries or if the severance was not successful then the property would pass to Iris by survivorship and the entire property would pass to the beneficiaries of Iris’ Will.
All parties seem to accept that Gloria had a very clear intention to sever the joint tenancy. Arguments were put forward that the Land Registry letter sent to Iris, and explanatory notes, confirming that severance had taken place should act as a substitute notice of the severance were rejected.
As the technical requirements of service were not fulfilled the Court decided that the notice of severance had not been successfully served and the Court ruled the property had passed by survivorship to Iris so the entire property fell within Iris’ estate to pass under her Will.
Clearly, great care needs to be taken if a notice of severance is to be served on a co-owner by registered post. If you wish to consider changing the ownership of your jointly owned property and make a Will at the same time then please contact Matt Kelly on 01283 214231 or at m.kelly@timms-law.com
Matthew Kelly
October 2020