De facto spouses owned a property as joint tenants and defaulted on their loan. The lender sold the property and paid the surplus into court.
They seperated and several years later the wife died. In these proceedings, the husband sought to withdraw 100% of the surplus proceeds from the court on the grounds that he was the surviving joint tenant.
A solicitor representing the interests of the estate of the wife raised the following arguments:
- that the mortgage has been severed by reason of the bank entering into possession of the property and that a new asset entirely was thereby created.
- section 26(1) of the Conveyancing Act reverses the common law presumption of joint tenancy and,
- the parties evinced an intention that any joint tenancy was severed
In relation to point 1, the court found that there was long standing authority that rejected that view.
In relation to point 2, the court found no applicability for that section.
In relation to point 3, the court held that an understanding was not sufficient and the husband gave evidence that there was no agreement and there was no contradictory evidence before the court.