Author: Ewan O’Reilly
Co-ownership of immovable property. What is co-ownership, how is it regulated between co-owners and how is this form of ownership affected by the death of a co-owner?
What is Co-ownership?
The meaning of “co-ownership” in the context of owning property, means, the simultaneous ownership of a property by two or more persons where each of their shares are undivided shares. Co-ownership is often utilised as an alternative to sole ownership and allows spouses or family to acquire and own immovable property.
Co-owners may elect to enter into a co-ownership agreement to regulate responsibilities relating to the joint-owned property.
The Co-ownership Agreement:
Co-owners are advised to enter into a co-ownership agreement, however this type
of agreement will merely regulate the responsibilities between the co-owners and will not
apply to third parties.
The co-ownership agreement may stipulate that a certain co-owner occupies a specific
portion of the land, however, a co-owners share of the property is factually not a share
in a specific and defined portion of the property, but rather a title to an undivided share in
the co-owned property. Should immovable property be built on the portion that a co-
owner owns as per the co-ownership agreement, the immovable property in fact belongs
to all the co-owners.
What are the responsibilities of Co-owners?
Expenses are shared between co-owners but only expenses which are of necessity and
are useful in order to maintain / preserve the property. Luxury expenditure /luxury
additions to the property are not shared between the co-owners. Should a co-owner be
negligent and the negligence is attributable to a specific co-owner, such co-owner shall
be liable for the expenses related to his/her negligence. Profits are
accordingly shared based on the shareholding percentage of each co-owner.
Death of a co-owner
In the unfortunate event that a co-owner passes away, where the co-owners were for example spouses married in-community of property, a co-ownership agreement would take effect to guide the surviving spouse. Should there be no such agreement in place, the Will of the deceased spouse shall be the factor affecting the outcome. In instances where the deceased spouse did not have a valid Will or did not have a Will at all, the laws of the Intestate Succession act will apply. If the surviving spouse benefits as the sole beneficiary of the Will of the deceased, the Executor will be responsible for ensuring that the deceased’s share of the immovable property is transferred to the surviving spouse.