Definition§
Tenancy in severalty is a form of property ownership where a single person or a single legal entity, such as a corporation, has complete and exclusive control over the property. This means that the owner has full discretion in making decisions about the property, including selling, leasing, or improving it, without requiring the consent of others. The term “severalty” comes from the idea that the property is “severed” from any form of co-ownership or joint ownership.
Examples§
- Individual Homeownership: An individual buys a house in their sole name. They have complete control over the property and can make all decisions independently.
- Corporate Ownership: A company purchases a commercial building. The corporation as a legal entity has exclusive ownership and control of the building.
- Single-Person Business Ownership: A sole proprietor owns a piece of real estate used for their business operations. The property is in the proprietor’s name alone.
Frequently Asked Questions§
What is the difference between tenancy in severalty and joint tenancy?§
Tenancy in severalty involves ownership by one person or entity, giving them exclusive control over the property. In contrast, joint tenancy involves multiple owners who have equal shares and rights to the property, typically including the right of survivorship.
Can a business entity own property in severalty?§
Yes, a business entity such as a corporation or an LLC can own property in severalty, wherein the entity is considered the sole owner.
What happens to tenancy in severalty ownership upon the death of the owner?§
Upon the death of the owner in a tenancy in severalty, the property typically goes through probate and is distributed according to the owner’s will or state intestacy laws if there is no will.
Is tenancy in severalty common in commercial real estate?§
Yes, tenancy in severalty is quite common in commercial real estate where properties are often owned by single entities, such as corporations, for business purposes.
Can property owned in severalty be converted to another form of tenancy?§
Yes, property owned in severalty can be converted to another form of tenancy, such as joint tenancy or tenancy in common, by transferring ownership interest to other individuals or entities.
Related Terms§
- Joint Tenancy: A legal arrangement where two or more people hold equal shares of a property with the right of survivorship.
- Tenancy in Common: A form of co-ownership where each owner holds a distinct, separately transferable interest without the right of survivorship.
- Sole Proprietorship: A business entity owned and managed by one individual with no distinction between the business and the owner.
- Legal Entity: An organization that has legal rights and obligations, such as a corporation, limited liability company (LLC), or trust.
Online References§
- Investopedia on Tenancy in Severalty
- Nolo: Tenancy in Severalty
- The Balance: Types of Property Ownership
Suggested Books for Further Studies§
- “Real Estate Principles: A Value Approach” by David C. Ling and Wayne R. Archer
- “Principles of Real Estate Practice” by Stephen Mettling and David Cusic
- “Modern Real Estate Practice” by Fillmore W. Galaty, Wellington J. Allaway, and Robert C. Kyle
Fundamentals of Tenancy in Severalty: Real Estate Basics Quiz§
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