Co-Ownership, Family & Business Partners

Joint tenancy is the default for most married couples in Alberta. Right of survivorship means the property bypasses the will entirely — the surviving joint tenant becomes sole owner immediately on death. Simple, clean, and usually the right choice for spouses.

Tenants in common is the better choice when buying with a sibling, parent, friend, business partner, or anyone who isn't your spouse. Each person owns a defined percentage (50/50, 60/40, whatever you agree on). Their share goes to their estate — meaning their beneficiaries inherit it, not you.

With joint tenancy, right of survivorship kicks in. You file a Transmission on Death at Alberta Land Titles with the death certificate, and the title transfers to you alone. The mortgage continues — you're responsible for the full payment.

With tenants in common, the deceased person's share passes through their will (or Alberta's intestacy rules if there's no will). You could end up co-owning property with their adult children, their new spouse, or whoever they named as beneficiary. The mortgage must still be paid, and both you and the estate share that obligation.

If your business partner dies and you're tenants in common, their share goes to their estate. Their executor or beneficiaries may not want to co-own property with you. They may want to sell immediately — at a price and timeline that doesn't work for you.

If your partner becomes incapacitated without an Enduring Power of Attorney, decisions about their share may require a court-appointed trustee. This is expensive, slow, and the trustee has a legal obligation to the incapacitated person — not to you.

What should be in place before you close: a co-ownership agreement with a shotgun clause, life insurance on each partner (enough to fund a buyout), Enduring Powers of Attorney, and a clear exit formula.

Divorce: In Alberta, the Family Property Act governs property distribution for both married spouses and adult interdependent partners ending their relationship. Even if your co-owner's spouse is not on title, they may be entitled to a share of the property's value as part of the property division.

Lawsuit/judgement: A creditor with a court judgement can register a lien against your co-owner's interest in the property. This clouds the title and makes it very difficult to sell or refinance until the lien is resolved.

Bankruptcy: Your co-owner's share becomes an asset of the bankruptcy estate, managed by a licensed insolvency trustee. The trustee can force a sale of their interest. You may have the option to buy their share, but you'll be negotiating with the trustee, not your former partner.

Co-ownership agreement: Covers who pays what (mortgage, taxes, insurance, maintenance), what happens if someone wants out, how to handle a buyout, dispute resolution, and a shotgun clause (one party names a price, the other must buy at that price or sell at that price).

Updated wills: Make sure each owner's will reflects the co-ownership arrangement. Without this, the estate may not handle the property the way you assumed it would.

Life insurance: Enough to cover a buyout. If your co-owner dies, their life insurance pays you enough to buy their share and become sole owner. Without this, you may need to sell the property to settle with the estate.

Enduring Powers of Attorney: If either owner becomes incapacitated, the EPA allows their appointed attorney to make decisions about the property without going to court.

Adding an adult child to title seems like a simple estate planning move. In practice, it creates multiple risks:

Family law risk: If your child divorces, their spouse may claim a portion of the property value under Alberta's Family Property Act. Even if you added the child to title "just for estate purposes," the property is legally theirs in part.

Creditor risk: If your child has debts, creditors can pursue their interest in your home. A judgement lien on their share clouds your title.

Tax risk: Adding someone to title may be considered a disposition for tax purposes. You could lose the full principal residence exemption on your home. CRA may see it as a gift or a partial sale, triggering capital gains.

Better alternatives: A properly drafted will with an executor you trust, a transfer on death designation (if available), or a family trust may achieve the same estate planning goals without the risks.

When you co-sign a mortgage, you're telling the lender "if they can't pay, I will." Death and disability are included in "can't pay." The lender can pursue you for the full outstanding balance, missed payments, and any costs associated with enforcement.

If your child dies, their estate may have life insurance or other assets to pay off the mortgage. But if those assets don't cover it, you're on the hook for the remainder. If your child becomes disabled and can't make payments, the lender comes to you.

Multi-family purchases are increasingly common — especially with rising prices. Two siblings and their spouses buying a duplex, a parent and adult child purchasing a multi-generational home, friends pooling resources for a starter property.

If one party wants out: Without an agreement, they can apply to the Court of King's Bench for a partition and sale order. The court can force the sale of the entire property — even if the other family doesn't want to sell. The process takes months, costs tens of thousands in legal fees, and destroys relationships.

If one owner dies: With tenants in common, their share goes to their estate. The surviving family may end up co-owning with someone they didn't choose. With joint tenancy (rare between unrelated families), the survivors get everything — which may not be the deceased's intention.

The solution is simple: A co-ownership agreement with a shotgun clause, clear expense-sharing terms, and a buyout formula based on current appraised value. Draft it before closing. Review it every few years. It's the cost of one nice dinner to prevent a six-figure legal battle.