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All joint tenants co-own the entirety of the subject property and a distinctive feature of that co-ownership is survivorship. A joint tenant can, of course, destroy a joint tenancy by an attempted disposition of interest, assignment, mortgage, bankruptcy, a communicated unilateral declaration by one joint tenant, agreement between the joint tenants or notice under Law of Property Act 1925 s.36(2).
Severance can defeat the original intention and expectation of the joint tenants, each of whom believed they would inherit on the death of the other.
Is it possible by agreement to prevent severance, would such an agreement be defeated by s.36(2) and what would its impact be on the rights of those interested in the property? Can an agreement not to sever be contractually binding? If so can one party to such an agreement (one joint tenant), revoke it by asserting a more fundamental or primary right to sever?
The English courts have treated agreements limiting the means of operating and determining a trust as valid contractual arrangements. Furthermore, the courts will not permit a party, who would thereby be defeating the purpose of the trust and reneging on an agreement, to force the execution of the trust, especially if that party has derived benefit from the agreement and now wishes to escape the corresponding obligations upon him - see In re Buchanan-Wollastons Conveyance [1938] 1 Ch 217.
Does such an agreement override the general right to sever? There does not appear to be any English authority directly on the point. However, a decision of the Supreme Court of Texas is of some interest - see Fitts v Stone 166 S.W. 2d 897. There was a written contract that neither joint tenant would sell any part of jointly owned property for 2 years. The breach of the agreement by one joint tenant did not render any associated transaction with a third party void nor was the joint beneficial tenancy preserved, but the other joint tenant was entitled to damages for breach of contract in so far as injury (loss) was suffered. An Australian decision also offers direct support for the view that such an agreement can give rise to a valid contractual obligation, as between the joint tenants, not to sever but does not impact on the property rights of the parties or third parties. In Re Debney (1960) S.R. (N.S.W) 468 the court was considering a written agreement prohibiting severance and concluded it did not offend against the Conveyancing Act 1919-1954 s66G. Although properly (and strictly) construed that clause prevented the parties severing, it did not prevent one party applying for an order for sale in the absence of consent. There was therefore no reason to strike down the clause.
It follows that such an agreement does not appear to circumvent or conflict with the Law of Property Act 1925 or indeed, the provisions of the Trusts of Land and Appointment of Trustees Act 1996. However, such an agreement will only take effect as a contractual obligation between the contracting parties. If that is correct, available remedies would appear to be a pre-emptive strike by way of an application for specific performance/injunctive relief to prevent service of a notice to sever or an attempt to dispose of or deal with one joint tenant’s interest, or damages after the event. It is doubtful whether even a very specifically-worded contractual provision could amount to anything more than a matter to be taken into account when resisting an application under s14 of the 1996 Act.
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