How Does A Partition Of Real Property Work?

In the context of real estate law, a partition refers to a legal process used to divide or separate co-owned property among the co-owners. Think of this like a forced sale of the property when the co-owners cannot agree what to do with it. It is often employed when there is a dispute or disagreement among co-owners regarding the use, management, or sale of a jointly owned property. My office sees this issue most frequently when unmarried couples purchase a property together and then break up and disagree about what to do with the property. I also see this very frequently when children inherit a property and do not agree on how (or if) to dispose of it and when a business endeavor purchases a property, which business then dissolves, leaving disagreements between the partners/members.

WHO CAN FILE A PARTITION?

If you are on title to a property, then you have the right to file a partition action and force the sale of it. You would be filing the partition action against all other owners listed on title to the property. The exception to this is if you own the property as tenants by the entirety with a spouse.

WHERE IS A PARTITION FILED?

 A partition action is filed in the county where the property resides.

WHAT HAPPENS WHEN THE PROPERTY IS SOLD?

Once the property is sold, the court will determine how the sale proceeds should be provided amongst the owners. Not all owners will necessarily receive the same amount. The court takes into consideration all those improvements and contributions made towards the property by one owner, which may include, but is not limited to, property improvements, mortgage payments, taxes paid, etc. If the parties cannot first amicably agree on the division of sale proceeds, the court will hold an evidentiary hearing and take into account all relevant facts to determine the most equitable division of sale proceeds.

When the property is sold, all existing liens and mortgages will be paid off from the sale proceeds before being distributed to the owner. Attorneys are also entitled to be paid from the closing of the property, should the fee structure you work out with your attorney call for this.

DO THE PROPERTY OWNERS AUTOMATICALLY LOSE THE PROPERTY IF A PARTITION IS FILED?

Like we mentioned above, a main reason a partition action is filed is when the property is jointly owned by two or more parties whom cannot agree on what to do with it. Often times, one party wants to keep the property and one wants to sell. So, what happens if a partition action is filed, and one party wants to keep the property? The good news is that the party who wants to stay in the property, or maintain ownership of it, may be able to purchase the interest from the party who wants to sell, thus retaining ownership.