Humber/Ontario Real Estate Course 1 Exam Practice

When Buyers Harris and Allen purchase an investment property with Harris having three-fourths interest and Allen one-fourth interest, which statement is correct?

1. They are joint tenants because they acquired the property simultaneously

2. The title automatically transfers to Allen upon Harris's death

3. Joint tenancy isn't created as their interests are not identical

4. They will form a joint tenancy if the interests were acquired at the same time

5. They both have undivided shares in the property

6. Neither can sell their share without the other's consent

The correct answer is: Joint tenancy isn't created as their interests are not identical

In this scenario, Harris and Allen have unequal interests in the investment property - Harris has three-fourths interest while Allen has one-fourth interest. For a joint tenancy to be created, one of the essential characteristics is that the co-owners must have an equal, undivided interest in the property. Since Harris and Allen's interests are not identical (three-fourths and one-fourth), a joint tenancy is not established. This is why option C is correct. Options A and D are incorrect because joint tenancy requires equal and undivided interests, not just acquiring the property simultaneously. Option B is incorrect because in joint tenancy, the title automatically transfers to the remaining joint tenant(s) upon the death of one tenant, not specifically to Allen in this case. Option E is also incorrect because their shares are not equal and undivided. Option F is incorrect in this scenario as neither can sell their share without the other's consent applies to joint tenants, not in this case where joint tenancy is not established due to unequal interests.