Tenants in Common with Rights of Survivorship

Question

Does anyone know if when you have a deed for "tenants in common with rights of survivorship" and a tenant sells their interest before someone has died? Does the buyer get to keep it, or would it be transferred to someone else? We are aware that "tenants in common with rights of survivorship" does not technically exist in law. My jurisdiction is Indiana.

Answer 1

Does anyone know if when you have a deed for "tenants in common with rights of survivorship" and a tenant sells their interest before someone has died? Does the buyer get to keep it, or would it be transferred to someone else? We are aware that "tenants in common with rights of survivorship" does not technically exist in law. My jurisdiction is Indiana.

The difficulty is that "tenants in common with rights of survivorship" is not a recognized interest in real property, so its meaning is unclear.

Ordinarily, "joint tenants with rights of survivorship" is the form of ownership used to create a right of survivorship in co-owned property not owned by an entity. A joint tenancy can be severed is converted by operation of law to a tenancy in common without a right of survivorship by a transfer of one joint tenant's interest to a third-party.

You could also imagine a situation where, for example, mother conveys real estate to her daughter, subject to a concurrent life estate for the mother that is reserved by her in the conveyance.

In that case, if the mother conveyed her life estate interest to a third-party, the interest that the third-party would receive in the real property would be a "life estate per autre vie", which would have all of the rights of a life estate owner in the property but would terminate at the death of the mother.

Another way to interpret the intent of the parties in a "tenants in common with right of survivorship" deed is to assume that it was attempting to create a "fee tail":

In English common law, fee tail or entail is a form of trust established by deed or settlement which restricts the sale or inheritance of an estate in real property and prevents the property from being sold, devised by will, or otherwise alienated by the tenant-in-possession, and instead causes it to pass automatically by operation of law to an heir determined by the settlement deed. The term fee tail is from Medieval Latin feodum talliatum, which means "cut(-short) fee" and is in contrast to "fee simple" where no such restriction exists and where the possessor has an absolute title (although subject to the allodial title of the monarch) in the property which he can bequeath or otherwise dispose of as he wishes.

Most common law jurisdictions, including all but four U.S. states, have abolished or never had the "fee tail" form of ownership, either due to a statute or case law (sometimes case law interpreting the rule against perpetuities), at least outside of a true equitable interest under the terms of a trust with a trustee holding legal ownership of the property, or a will contract.

For example, Fee tail as a legal estate in England (after being created by statute in 1285 CE) was abolished by the Law of Property Act 1925. It was abolished in Ireland in 2009. Scotland abolished the fee tail estate in the year 2000. Title registration requirements effectively abolished it in New Zealand and perhaps in Australia as well, although I don't have an exact timeline for that. Per the "fee tail" link above:

The fee tail has been abolished in all but four states in the United States: Massachusetts, Maine, Delaware and Rhode Island. However, in the first three states, property can be sold or deeded as any other property would be, with the fee tail only applying in case of death without a will. In Rhode Island, a fee tail is treated as a life estate with remainder in the life tenant's children. New York abolished fee tail in 1782, while many other states within the U.S. never recognized it at all. In most states in the United States, an attempt to create a fee tail results in a fee simple; even in those four states that still allow fee tail, the estate holder may convert his fee tail to a fee simple during his lifetime by executing a deed.

In Louisiana, the common law concept of estates in land never existed. The concept of forced heirship and the marital portion protects force heirs and surviving spouses from total divestment of value of the estate of the decedent, who has a duty to provide for their care.

Fee tail-like restrictions still exist though contractual obligations. For example, owners of inholdings inside public lands may be prevented from selling or giving their land to non-family members. In this case, the restrictions result from an agreement between the government and the land owner, and is not a part of a deed or settlement.

In jurisdictions that have abolished non-equitable "fee tail" title to property, the survivorship elements of the fee tail deed are deemed to be void restraints on alienation as a matter of law because this violates public policy, and the deed purporting to create a "fee tail" instead creates tenant in common ownership shared by the present interest owners of the property under the fee tail.

Because a "tenancy in common with right of survivorship" is not a well defined estate in real property the rights that a third-party transferee of a person who is a "tenancy in common with right of survivorship" is undefined, and there would probably have to be a quiet title lawsuit to determine what rights the transferee had in the property.

There is very little case law on this point and testimony regarding the intent of the parties in titling the property in this manner would be relevant.

Probably the mostly likely outcome in the absence of other evidence would be to reform the "tenancy in common with right of survivorship" deed into a "joint tenancy with right of survivorship" deed, and then to treat the joint tenancy as severed and the right of survivorship terminated if one of the co-owners of the property titled in "tenancy in common with right of survivorship" to a third-party transferee, leaving the other co-owners and the transferee as tenants in common without a right of survivorship.