A guide to making informed decisions.

Purchasing a property is one of the biggest investments made in life. For various reasons, it is often done in partnership with one or more owners, whether spouses, business partners or trusted friends. From a legal perspective, there are two primary ways to co-own a property in the Cayman Islands so it is essential for purchasers to know the differences and implications of each. Making an informed decision about how the ownership will be shared before you buy may save you from complications in the future.

There are two main ways to co-own a property: as joint proprietors or as proprietors in common. The option you choose can significantly affect your rights, especially in the event of financial difficulties, the breakdown of a relationship, or the death of one or more of the owners.

It is a well-established principle of joint proprietorship (or ‘joint tenancy’ in other common law jurisdictions) that each joint proprietor has an identical interest in the whole land and every part of it. It has been said that each joint proprietor ‘holds the whole jointly and nothing separately’. In Cayman, joint proprietorship carries the ‘right of survivorship’. In simple terms, if one owner passes away, the property’s ownership seamlessly transitions to the surviving co-owner or co-owners (if there is more than one).

In contrast, there’s proprietorship in common. Here, each individual owns a distinct, ‘undivided’ share of the property. But don’t be mistaken – this doesn’t mean one owner has the front yard and another the back. Instead, it signifies a share in the property’s ownership, not a subdivision of the property. For proprietors in common, shares may be equal or unequal. When a proprietor passes away, their share forms part of their deceased estate. When the estate is administered, the property may pass to a surviving spouse, pass down as an inheritance, or sometimes, it might be offered for sale to the surviving owner or owners or sold on the open market. In any event, it will not be directly transferred to the co-owner as it would in a joint proprietorship.

For any purchase it is essential to consider the nature of your relationship with your co-owner and your plans for the future when deciding which option works best for you.

For first-time spouses or partners purchasing a family home, joint proprietorship suits many couples. This choice aligns with common estate plans, where a spouse or partner intends that the property will benefit the other and, subsequently, their children if something happens to them. Cayman laws provide a clear path for distributing marital property if a marriage becomes irreparably damaged.

On the other hand, for blended families, subsequent relationships or more profit-driven co-ownership plans, proprietorship in common may be the preferred approach.

Just as every property is different, every relationship is, too. Your circumstances, goals and future plans are unique, and you must be able to make informed choices about what your co-ownership will mean.

It’s always recommended that you make a Cayman will once you have Cayman assets. If you hold property as a proprietor in common, this should factor into your will or estate plans. What’s more, if you’re considering leaving property to multiple beneficiaries, you may wish to consider how they will hold the property as co-owners.

There really isn’t one path that will suit everyone. Discussing your plans and references with a professional advisor is recommended if that’s available to you.

To conclude, while the thrill of co-owning property in the Cayman Islands is undeniable, making decisions with foresight is imperative. After all, a little planning today promises peace of mind tomorrow. There are two main ways to co-own a property: as joint proprietors or as proprietors in common. The option you choose can significantly affect your rights, especially in the event of financial difficulties, the breakdown of a relationship, or the death of one or more of the owners.

It is a well-established principle of joint proprietorship (or ‘joint tenancy’ in other common law jurisdictions) that each joint proprietor has an identical interest in the whole land and every part of it. It has been said that each joint proprietor ‘holds the whole jointly and nothing separately’. In Cayman, joint proprietorship carries the ‘right of survivorship’. In simple terms, if one owner passes away, the property’s ownership seamlessly transitions to the surviving co-owner or co-owners (if there is more than one).

In contrast, there’s proprietorship in common. Here, each individual owns a distinct, ‘undivided’ share of the property. But don’t be mistaken – this doesn’t mean one owner has the front yard and another the back. Instead, it signifies a share in the property’s ownership, not a subdivision of the property. For proprietors in common, shares may be equal or unequal. When a proprietor passes away, their share forms part of their deceased estate. When the estate is administered, the property may pass to a surviving spouse, pass down as an inheritance, or sometimes, it might be offered for sale to the surviving owner or owners or sold on the open market. In any event, it will not be directly transferred to the co-owner as it would in a joint proprietorship.

For any purchase it is essential to consider the nature of your relationship with your co-owner and your plans for the future when deciding which option works best for you.

For first-time spouses or partners purchasing a family home, joint proprietorship suits many couples. This choice aligns with common estate plans, where a spouse or partner intends that the property will benefit the other and, subsequently, their children if something happens to them. Cayman laws provide a clear path for distributing marital property if a marriage becomes irreparably damaged.

On the other hand, for blended families, subsequent relationships or more profit-driven co-ownership plans, proprietorship in common may be the preferred approach.

Just as every property is different, every relationship is, too. Your circumstances, goals and future plans are unique, and you must be able to make informed choices about what your co-ownership will mean.

It’s always recommended that you make a Cayman will once you have Cayman assets. If you hold property as a proprietor in common, this should factor into your will or estate plans. What’s more, if you’re considering leaving property to multiple beneficiaries, you may wish to consider how they will hold the property as co-owners.

There really isn’t one path that will suit everyone. Discussing your plans and preferences with a professional advisor is recommended if that’s available to you.

To conclude, while the thrill of co-owning property in the Cayman Islands is undeniable, making decisions with foresight is imperative. After all, a little planning today promises peace of mind tomorrow.