Sometimes, a dentist might own a piece of real property with another person. But did you know that there are different business structures which the dentist might end using inadvertently (some structures are better than others – depending on your specific circumstances)? This comes up when a dentist passes away, for example, when the Estate Trustee has to deal with co-owned property of the deceased…
In what follows, I’ll briefly discuss co-ownership in the form of tenants in common and how this structure differs from a partnership. Before talking about those differences, it’s worthwhile to discuss what holding property as tenants in common or as joint tenants means.
To start, you should know that co-ownership means that two or more parties are owning property together. They can do so as tenants in common or as joint tenants. Tenants in common each have an interest (which need not be equal) in the property which can be transferred generally unilaterally and without anyone else’s consent; upon death, that interest would go to their estate and the beneficiaries thereunder.
If, however, parties are holding land as joint tenants, then a right of survivorship arises: the surviving party obtains the other party’s interest in the property when that party dies. Joint tenancy have equal, unlimited, and free access to the property in question. Transfers of property interests must be made unanimously.
There are important control, estate, and tax consequences that may arise – depending on whether you’re holding property as a tenant in common or as a joint tenant. Now, with these preliminary things said and done, I will move on to the differences between owning property through a partnership vs. owning property as tenants in common and NOT through a partnership.
Parties can be co-owners of property without necessarily being partners (Section 3.1 of the Partnerships Act). Here are the key differences between partnerships and co-ownerships:
Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only. If you need legal advice, contact me (Michael Carabash) or David Mayzel or Ljubica Durlovska.
David Mayzel is your legal risk manager. He is a trained courtroom lawyer and has spent many years resolving disputes both in and out of court. He knows how to prepare documents and execute transactions in a way that avoids or mitigates legal risks. He can be reached at 416.528.5280. or email@example.com.
Michael Carabash is your business law adviser. He is an entrepreneur at heart who helps you see the big legal picture. He drafts clear and effective agreements that protect your rights while promoting your interests. He can be reached at 647.680.9530. or firstname.lastname@example.org.
Ljubica Durlovska is your transition lawyer. She helps you with staff and associates, maintaining your corporation, and other business matters. She can be reached at 416.443.9280, extension 206 or email@example.com.
Jonathan Borrelli is your employment lawyer. He helps you with staff and associates matters, including hirings, terminations, switching staff to written contracts and resolving disputes. He can be reached at 416.443.9280, extension 204 or firstname.lastname@example.org.
Benjamin Kong is an experienced business law clerk. He assists David and Michael with corporate matters and purchase / sale transactions. He can be reached at 416.443.9280, extension 207 or email@example.com.
Julie Whitehouse is an experienced business law clerk. She assists David and Michael with corporate matters and purchase / sale transactions. She can be reached at 416.443.9280, extension 203 or firstname.lastname@example.org.
David, Michael, Ljubica, Jonathan, Ben and Julie are a truly dynamic team. Their diverse knowledge, skills, and experiences will help you get the best deal possible while promoting your interests and protecting your rights. You can read dentist testimonials here.