Disputes Between Co-owners - Recommendations

Specification of the Nature of the Co-owned Interest upon Registration

1. That a provision be inserted into the Transfer of Land Act 1958 that requires any instrument submitted for registration (including any electronic instruments) to specify whether co-owners are intended to be joint tenants or tenants in common. The Land Registry must refuse to register any instrument which does not state the nature of the coownership.

2. That the equitable principle that business partners or mortgagees who are registered as joint tenants are tenants in common in equity should continue to apply, in the absence of a contrary intention.

3. That co-owners, other than business partners or mortgagees, who register as joint tenants should be presumed to be joint tenants in equity. This includes co-owners who contributed unequally to the purchase price of the land.

4. That co-owners should be able to establish that their registered interest differs from their interest in equity by proving that there was a contrary intention at the time the interest was created.

5. That the fact that a particular interest was specified provides strong evidence of an intention to create that interest.

6. That Recommendations 2–5 also apply to co-owned interests that are created by registrable instruments that have not been registered.

7. That sections 30(2) and 33(4) of the Transfer of Land Act 1958 be repealed.

8. That the presumption of joint tenancy be retained for co-owned interests which are not created by a registrable instrument.

9. That the Land Registry produce a publication on co-ownership.

10. That a short statement explaining the difference between a tenancy in common and joint tenancy be included on transfer documents.

  • Paper transfer documents should have this statement on the back of the document.
  • Electronic conveyancing programs should contain a link that leads to the statement.

Severance of Joint Tenancies of Torrens Land

11. That a provision be inserted into the Transfer of Land Act 1958 enabling severance of joint tenancies by registration of an instrument of severance in a form approved by the Land Registry.

12. That a provision be inserted into the Transfer of Land Act 1958 making it clear that this method of severance is in addition to existing methods of severance.

13. That an instrument of severance should only be effective to sever a joint tenancy if it is lodged with the Land Registry.

14. That severance of a joint tenancy should be effective upon lodgement of an instrument of severance. The joint tenancy will have been severed even if the joint tenant dies prior to its registration.

15. That a joint tenant who lodges an instrument of severance not be required to provide the certificate of title prior to registration of the instrument.

16. That the enforceability of a mortgage or security interest against a coowner should not be affected by registration of an instrument of severance.

17. That severance of a joint tenancy by registration of an instrument of severance, without the consent of any mortgagees or holders of security interests, should not be considered a breach of any term in a contract that requires the mortgagee, or holder of the security interest, to consent to any dealings with the land.

18. That a provision be inserted into the Transfer of Land Act 1958 requiring the Land Registry to notify all joint tenants of any dealing that severs the joint tenancy.

19. That such notification be sent upon registration of the dealing that severs the joint tenancy.

20. That co-owners who seek to sever a joint tenancy be required to provide the Land Registry with the names and last-known addresses of all joint tenants, where these are known. A failure to provide last-known names and addresses should not hinder the severance process.

21. That notification be sent to all joint tenants (including the person who proposes to sever the joint tenancy) at their last-known address, as well as to the co-owned property (if practicable).

22. That the fee charged by the Land Registry for lodgement of the relevant transaction should permit cost recovery for notification.

23. That a provision be inserted into the Property Law Act 1958 specifying that, in the absence of written evidence of a contrary intention, parties who divorce after the creation of a joint tenancy be deemed to have severed the joint tenancy.

24. That a provision be inserted into the Property Law Act 1958 allowing joint tenancies of goods to be severed by service of a written notice.

25. That the notice be in a prescribed form.

26. That the notice be served upon all other joint tenants at their last known addresses. Service should either be personal or by registered mail.

27. That in the event of a dispute as to whether severance has taken place, proof should be provided that attempts were made to serve the notice on all other joint tenants.

Which is the most Appropriate Forum to Hear Co-ownership Disputes?

28. That the Victorian Civil and Administrative Tribunal (VCAT) be given jurisdiction in relation to disputes concerning the sale and division of all co-owned land and goods (‘co-ownership disputes’).

29. That section 187 of the Property Law Act 1958 be amended to provide that matters cannot be heard under section 187 if they can be heard by VCAT under the provisions relating to co-owned goods.

30. That the Tribunal hearing co-ownership disputes is to be constituted by, or include, a member who, in the opinion of the President of VCAT, has knowledge of, or experience in, property law matters.

31. That the jurisdiction of the Supreme and County Courts to hear coownership disputes be limited to matters in which there are special circumstances that justify a hearing by these Courts.

  • The existence of such special circumstances should be determined either by the Supreme or County Courts, or by the Victorian Civil and Administrative Tribunal (VCAT) under section 77 of the Victorian Civil and Administrative Tribunal Act 1998.
  • Factors to be taken into account in determining whether there are special circumstances should be whether the matter is complex, or whether there is an interrelationship with matters over which VCAT has no jurisdiction.

32. That appeals to the Supreme Court of decisions made by VCAT in relation to co-ownership disputes should lie on questions of law alone.

33. That in appropriate circumstances, in the initial directions hearing of co-ownership disputes that are heard by VCAT, the parties be advised of the possibility of filing applications for the division of the property in dispute under section 79 of the Family Law Act 1975 (Cth) or Part IX of the Property Law Act 1958 (‘alternative proceedings’).

34. That, on the application of a party, VCAT be given the power to temporarily adjourn proceedings to provide the parties time to initiate alternative proceedings. Such an adjournment should be brief, to avoid unnecessary delay. If alternative proceedings have not been initiated by the end of the adjournment period, VCAT should be at liberty to continue with its proceedings.

35. That VCAT be given the power to adjourn proceedings pending the resolution of any alternative proceedings that have been initiated. If the matter is resolved by the alternative proceedings, the VCAT application should be terminated. If the matter is not resolved, the VCAT application can be reactivated.

Alternative Dispute Resolution

36. That alternative dispute resolution (ADR) processes be made available to parties in co-ownership disputes.

37. That the use of ADR in a particular matter be determined in a directions hearing. There should be a preference for the use of ADR, but VCAT should, on the application of either party or of its own initiative, be able to determine that ADR is not appropriate in the circumstances. Such circumstances would include a history of violence between the parties.

38. That the type of ADR to be used in a particular matter be determined in a directions hearing, in accordance with the powers of VCAT under the Victorian Civil and Administrative Tribunal Act 1998 sections 83–93.

39. That the person nominated to mediate co-ownership disputes have some expertise in property law.

40. That VCAT develop a protocol to deal with potential issues of violence.

41. That the application form to VCAT for the hearing of co-ownership disputes note the existence of voluntary alternative dispute resolution services, such as those provided by the Dispute Settlement Centre of Victoria.

Sale and Division of Co-owned Land

42. That sections 221–32 of the Property Law Act 1958 be repealed.

43. That a provision be inserted into the Property Law Act 1958 giving VCAT the power to order sale of co-owned land and the division of the proceeds, or division of the land, or a combination of both sale and division.

44. That the powers of VCAT in relation to co-ownership disputes be broad, and include directly ordering sale or division, or appointing or removing trustees where necessary or desirable. Trustees will be necessary where any of the co-owners are minors or are incapable of looking after their own affairs. Trustees will be desirable where there is a history of violence between the parties.

45. That VCAT be given power to direct any appointed trustees as to the terms and conditions of the sale, and to distribute the proceeds in any manner VCAT sees fit.

46. That VCAT generally order sale of land and division of the proceeds, unless it would be just and equitable to order division of the land in the circumstances.

47. That in determining whether it is just and equitable to order division of the land in the circumstances, VCAT should take into account matters such as:

  • the use being made of the land, such as whether it is being used by one or more of the co-owners for residential or business purposes;
  • the nature of the property, including the practicality of dividing it, and whether such division will reduce its value;
  • whether the property is unique or has special value to one or more of the co-owners.

48. That VCAT be given power to permit other co-owners to buy the land, either at private sale or at auction. In such circumstances, VCAT should be empowered to order the sale to be at a fair market price (as determined by an independent valuer), or to set a reserve price for the auction.

49. That VCAT be given sufficient powers to ensure a fair and proper sale or division of the land takes place. This would include providing VCAT with the power to order an independent valuation of the land, set a reserve price, determine a timeframe for the sale, or order sale or division on any other necessary terms and conditions.

50. That VCAT should be given power to create any other rules necessary to ensure that a just and equitable sale or division of co-owned land takes place.

51. That VCAT’s jurisdiction in relation to co-ownership disputes should include the power to:

  • divide co-owned land in portions that differ from the co-owners’ entitlements; and
  • order the payment of money to compensate for differences in the value of the portions of land received by the co-owner(s) when the land is divided.

52. That when VCAT makes an order for division or sale of co-owned land it may also direct that:

  • compensation be paid by a co-owner to other co-owners;
  • one or more co-owners should account to the other co-owners for amounts received;
  • an adjustment be made to a co-owner’s interest to take account of amounts payable by co-owners to each other.

53. That in exercising its powers, VCAT should consider whether it would be just and equitable to make an order to:

  • reimburse a co-owner proportionately for an amount reasonably expended by the co-owner in improving the land;
  • compensate a co-owner for costs reasonably incurred for the maintenance or insurance of the property;
  • compensate a co-owner who has paid more than his or her proportionate share of mortgage repayments, rates, purchase money instalments or other outgoings for which the co-owners are liable;
  • compensate a co-owner for damage caused by an unreasonable use of the land by another co-owner; or
    require a co-owner who has occupied the land to pay an amount equivalent to rent, to a co-owner who did not occupy the land.

54. That VCAT should only have power to order payment of occupation rent:

  • to offset money received by that co-owner as reimbursement for money expended in relation to the land;
  • where the co-owner claiming occupation rent has been excluded from the property; or
  • where the co-owner claiming occupation rent has suffered detriment because it was impracticable for him or her to co-occupy the property with the other co-owner.

55. That VCAT should have power to order a co-owner who has received more than his or her just share of rents or other payments from a third party to account to the other co-owners.

56. That a co-owner should be able to make an application that another co-owner account for money received without also applying for division or sale of the land.

57. That a provision be inserted into the Property Law Act 1958 giving the Victorian Civil and Administrative Tribunal the power to order sale of co-owned goods and the division of the proceeds, or division of the goods, or a combination of both sale and division.

58. That co-owners of goods can make an application to the Victorian Civil and Administrative Tribunal for sale or division of the goods regardless of their share in the goods. It should not be necessary for the applicant to own an interest of a half or more in the goods.

59. That Recommendations 46–56 above should, where appropriate, also apply to co-ownership disputes involving goods.

Related Project: 
Publication Process: 
Publication Status: 

Related links

Main menu

Back to top