In Alberta, the owner of all real property (i.e. real estate) must be registered with the Land Titles Office. The property can be owned as either joint tenants or tenants in common. Joint tenancy is most commonly seen for residential homeowners. Joint tenants are equal owners of the property. If you purchased a home with your spouse, you likely own the property as joint tenants.
One of the implications of a joint tenancy is the right of survivorship. When one of the owners passes away, the property flows directly to the surviving owner. For example, if a husband and wife are joint owners of their home, and the husband passes away, the home will go into the wife’s name, and she will be the sole owner.
Impact of Joint Tenancy with Right of Survivorship
In the example above, as the home went into the wife’s name solely, it has bypassed the husband’s estate. If the husband has a will that outlines who should receive his assets when he dies, the house will not be included in that division, as the house belongs to the wife. This also results in the house avoiding the need for the will to go through the probate process.
In many situations, including when a couple is together, this transfer of the property ownership directly to the wife may be desirable. In many other situations, however, it may be unintended and have significant consequences. If property ownership is split equally between two business partners, as joint tenants with a right of survivorship, it may not be intended that the surviving business partner will receive the entire property. In that situation, it may not be appropriate for joint tenants to have equal property ownership with a right of survivorship, but instead be held as tenants in common or through a separate vehicle, like a corporation.
Some other assets, like bank and investment accounts, can also be held in joint tenancy with a right of survivorship. It is important that you review the ownership status of your assets, especially major ones like real estate, to ensure the ownership is as you intended. It is prudent for any person, even with a modest estate, to do some estate planning to ensure their assets go to those they intended to.
How Kirk Montoute Dawson LLP Can Help You Navigate Joint Tenancy with Right of Survivorship
Joint tenancy with right of survivorship can simplify property transfer to a surviving co-owner, but it may not always align with your estate planning goals.
At Kirk Montoute Dawson LLP, our wills and estates lawyers can review your joint tenancy arrangements and assist you in ensuring your assets are distributed as you intended.
Contact us for help navigating the right of survivorship rules and creating a plan to protect your legacy and your loved ones.
Author: Michael Ross