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April 17, 2000

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Larissa Fernand

What's in a name? If it is property that is the subject of discussion, then it's all in the name.

Naming a person as the owner of a house is one decision that requires careful thought. And, once done, it may be virtually impossible to revert that decision.

Listed below are the various options available that will take care of the inheritance factor.

Individual ownership

There is one sole owner who calls the shots. No one else's permission or signature is required to sell (or even lease or rent).
While this leaves no room for conflict, it might turn out to be a problem if you reside in a different town. You can take care of this issue by handing over the power of attorney to a neighbour, relative or friend to deal with any property matter that might crop up.

Where succession is concerned, it all depends on who the individual wishes his/her successor to be. Of course, you have to make this clear in your will.
In the absence of a will, the various personal laws based on religion will come into force. Get in touch with your lawyer to understand the various implications of each law.

Christians, Jews and Parsees come under the Indian Succession Act. Buddhists, Jains and Hindus come under the Hindu Succession Act. The Muslim law is further divided depending on the various sects but a common feature is that the owner can pass on only one-third of his property. The balance goes in accord with the Muslim law.

Joint ownership

Now it does not make much of a difference if you don't draw up your will. Because on the death, the joint surviving owner will get total ownership. A major plus point of joint ownership is that survivorship and security is automatic. There is no need to hand over a power of attorney if one is away. Either one of the owners can take care of the property matters.

While that can be viewed as a convenience, a problem with joint ownership is that the signature of both is needed to sell or even take their names off. So once you decide to jointly hold the property with say, your spouse, and then would like to revert to sole ownership later, it could backfire. Your spouse may just disagree to get his/her name off.

What happens in the case of a divorce? Each owner is entitled to an equal share of the property. But, if it is just one person who has put in all the money towards the property, then a case can be made out in court with evidence to prove that it should go to the person who has paid for it.

Co-ownership

So if two people are going to be investing in the home (as in the case of spouses), then it may be wise to opt for co-ownership. This implies that each person has a defined share in the property. It could be 50:50, 60:40, depending on what amount each person has put in.

So in the case of a divorce or sale, each will get an amount dependent on his or her ownership. If the agreement states that they are co-owners but does not specify the ownership, then it is assumed that the percentage break-up is 50:50.

Each co-owner can opt for a separate legal document, known as the agreement of co-ownership stating what the division should be.

And, what about succession? Simple. Each can leave his/her share to whoever they want.

Nomination

Apartments in co-operative societies offer this option. But the nominee is not the owner. Neither does he become the owner if the owner passes away. He becomes the owner only if mentioned in the will as a successor.

On the owner's death, the nominee becomes a member of society and a nominal owner till the apartment is transferred to the person named in the will who becomes the beneficial owner.

Lessons to be learnt

The moment you own a piece of land solely on your name, draw up your will.
If individually owning a piece of land, think of a person to whom you can hand over your Power of Attorney to should the need arise.
Think wisely when making someone a joint-owner.
If you contribute towards the buying of the property, however small the amount, insist on co-ownership.
If the home is owned on a co-ownership basis, then draw up a will stating your successor.
Even if you and the co-owner wish to leave it to the same individual (eg: parents leaving it to their child), it is still wise for each of you'll to draw up individual wills naming your heir.
If it is a home in Goa, then the Portuguese law still holds. Which means that the wife automatically owns 50 per cent of what her husband does and vice versa.

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