Co-owners of real property eventually will want to stop being co-owners, because of divorce, because business partners can’t get along, because relatives inherit real property together with most wanting nothing to do with the property, or simply because they just don’t want to continue owning property with others. However, if one co-owner won’t agree to sell the property or doesn’t want (or doesn’t have the ability) to purchase the other co-owner’s interest in the property, what can the co-owners do? In California, there is only one answer to this question: Partition.
Basically, partition will proceed in one of three ways. One, co-owners can mutually and jointly agree to sell their property to a third party at the best possible price. Two, if co-owners can’t reach a mutual agreement, one or more of them can request a court to force the sale of the property, and what is left over from the sale will be divided among all of the co-owners, after court costs, attorney fees, referee fees, etc., are deducted from the sale proceeds. Three, one or more of the co-owners can offer to sell their interests in the property to the remaining co-owner(s). This is called partition by appraisal and requires a written agreement among all of the co-owners which describes the property, the names of the co-owners together with their interests in the property, the names of those willing to acquire the interest of the other(s), and the dates when those interests are to be appraised. Other terms can be mutually added, including but not limited to, provisions relating to abandonment of the action if the appraised value of the interest to be acquired exceeds a stated amount, requiring deposits on account of purchase price, terms of any credit, title and objections to title, and payment of authorized costs and expenses of the partition procedure.
If co-owners cannot agree on how their real property is to be divided or sold, partition is the only method they can employ to disentangle themselves from their ownership. However, going through the partition process can be fairly complex and is, more often than not, highly emotional. Having an experienced attorney assist with this process can ease, and often eliminate, the complexity and emotional components of this process.
Finkel Law Group, with offices in San Francisco and Walnut Creek California, has worked with residential homeowners and business partners regarding their real property issues. When you need intelligent, insightful, conscientious and cost-effective legal counsel to assist you with your real estate needs, please contact us at (415) 252-9600, (925) 274-9600, or email@example.com to speak with one of our attorneys about your matter.