What is Tenancy in Common?

Tenants in common enjoy equal rights of possession. However, this does not mean that ownership is equitably distributed. Say, three tenants are in common agreement and they hold the property in proportion of 50:30:20 . A person who owns 20 percent of the property enjoys the same rights of occupation as one who owns 50 percent. Having a greater stake in the property does not mean that one has the right to exclude others, who own smaller shares, from occupying the property in the presence or the absence of the majority stakeholder. In other words, ownership refers to the amount invested and the portion that is owned as a consequence of investment, while possession refers to physically occupying the same. Tenants also have the right to receive a prorated share of rents or profits that accrue from leasing or selling the property respectively.

It is important to note that tenancy in common agreement does not require the tenants to be related. A tenant has the right to pass on his/her share of ownership to the heirs with/without the consent of other co-tenants. A tenant can also exercise the option of bequeathing the property to a co-tenant by naming the latter in the will. Regardless of whether or not the inheritor is a co-tenant, the other tenants maintain their status quo. All liens on the property must be cleared to ensure the transfer of ownership. The surviving tenants can also opt to buy the inheritor's share of the property, provided the latter is willing. If the inheritor is unwilling to sell his/her share of the property to the surviving tenants, but wants to sell off the property to the highest bidder, the latter may object, thus forcing the heir to file a partition action with the court. Doing so will result in the property being sold off as per court orders. The proceeds from the sale of the property will then be distributed among the tenants. This in turn results in the dissolution of the current agreement of holding the property. The agreement may also be dissolved if the co-tenants voluntarily decide to sell the property and distribute the proceeds amongst themselves.