Jim Bush, Partner at Keystone Law Group, discusses the most important things to know about a partition. Read the complete article below for more details. Click the YouTube Channel subscribe button to be notified when new videos are published.
Do you no longer want to remain a co-owner of property? See if a partition action is right for you.
Suppose you’ve inherited a house with your siblings. You want to sell the property to improve your financial situation, but your siblings wish to keep it. Can you be forced to remain a co-owner, or is it possible for you to terminate your interest in the property?
The good news is that, unless an exception applies, you cannot be forced to remain a co-owner of property you don’t want. If the other co-owners are unwilling to sell their interests or buy out yours at fair market value (as determined by an appraisal), forcing a sale of the jointly owned property through a type of lawsuit known as a partition action is a viable option.
Suppose you co-own a restaurant with two friends, and one friend dies unexpectedly, causing her ownership interest to pass to her estate. The estate gives you and the remaining co-owner the opportunity to buy out the deceased friend’s interest, but neither of you has the funds for a buyout, as your capital is tied up in the restaurant. Can the estate seek a partition of the property, and if so, how would that process work?
While the deceased friend’s estate could file a partition action, courts often encourage alternative solutions first. For example, a third-party investor might buy out the deceased friend’s interest, or you and the remaining co-owner could negotiate a phased buyout over time. If these alternatives aren’t feasible, a partition action may be the best solution.
Partition actions can feel like a drastic step — especially for co-owners opposed to selling a property. They also are notoriously difficult to successfully defend. However, understanding how partition actions work, the different types of partitions available and potential alternatives can help you navigate the process and improve your chances of a favorable outcome.
A probate attorney can be an invaluable resource in partition cases. These attorneys are experienced in handling disputes over property division after death and can advise whether a partition action is appropriate. They can also manage the often-complex legal process on your behalf, helping ensure your rights and interests are protected.
What Is a Partition Action?
A partition action is a legal process used to force the sale or division of jointly owned property when co-owners disagree on how to manage or dispose of it. In California, most jointly owned property is partitionable.
That said, partition actions are primarily used in real estate disputes — typically when one co-owner wants to sell a property but the others do not — allowing the court to terminate joint ownership and distribute the property or its proceeds fairly.
Partition Actions and Probate: Can Inherited Property Be Partitioned?
In probate, a partition action may arise when there is a dispute around the division or sale of a decedent’s interest in property that multiple beneficiaries have inherited.
If beneficiaries are against jointly owning the property, cannot agree on how to divide their interests or are unable to reach a mutually agreeable buyout deal, a partition action can be filed to force the sale of the property. However, before a sale is forced, the non-partitioning co-owners must be given the opportunity to buy out the partitioning co-owner’s share at fair market value, as determined by an independent appraisal of the property.
In the event a partition action does lead to a forced sale of property, the sale proceeds must be distributed to the beneficiaries according to their respective ownership shares.
Suppose a decedent co-owned only a fractional interest in real property as a tenant in common. When a co-owner holds title as a tenant in common, it means their interest in the property is distinct and transferable. And upon their death, it may transfer to their estate and pass through the probate process.
When it’s undesirable or illogical for beneficiaries to jointly own a decedent’s interest in a property with other tenants in common, they may ask the tenants to buy out their shares or convince them to sell the property, terminating their interests. If the co-owners cannot agree on how to handle the property, the beneficiaries could sue for partition of property and force its sale, but not before giving the existing tenants a chance to buy out their shares at fair market value.
When Is Partition of Property Available?
Unless all co-owners previously waived the right of partition in a binding contractual agreement, co-owners’ right to partition is absolute. In short, if a property is jointly owned, it generally can be partitioned (unless an exception applies).
Partition actions can be filed even when only a minority of co-owners are seeking to sell their interest. While forcing the sale of jointly owned property may seem unfair in such a scenario, the law generally cannot require someone to continue owning property they no longer want.
That said, due to recent changes to California’s partition laws, non-partitioning co-owners must be given the opportunity to buy out the partitioning co-owner’s interest in the property at fair market value (as determined by an appraisal) before a forced sale of the property occurs. They must also be timely notified of the partition action so they have the chance to respond or negotiate.
Due to the legally complex nature of partition actions, it is critical for co-owners to consult a trusted partition attorney who can guide them through the process and explore viable alternatives.
Partition Action Requirements
To seek a court order forcing the sale of property through a partition action, the most basic requirement is that you co-own the property at issue with at least one other individual.
A simple way to confirm whether you are a co-owner is to refer to the property deed. If your name is on title, you usually have the right to file a partition action.
In general, even though a will or trust may designate a decedent’s home to pass to certain beneficiaries, those beneficiaries cannot sue for partition of property until the executor or trustee formally transfers the property’s title to them.
In addition to co-owning the property with at least one other individual, the following conditions must be met to file a petition to partition property:
- The property at issue cannot be physically divided fairly and equitably.
- At least one co-owner wants to sell, while the others don’t.
- The partitioning co-owners gave the non-partitioning co-owners the opportunity to buy out their shares at fair market value.
Physical partitions of real property are rare — since physically dividing property fairly and equitably isn’t typically possible. For instance, how would one fairly divide a single-family home between equal co-owners?
Provided that one co-owner wants to sell, and the others want to retain ownership, the only reasonable approach would be for the co-owners to negotiate a buyout agreement or for the property to be sold, with the proceeds from the sale being divided equally between the co-owners.
It’s ideal for co-ownership disputes to be resolved independent of the court, since partition actions often are costly. However, when an agreement cannot be reached out of court, forcing the sale of jointly owned property through a partition action may be the only remaining option for co-owners desiring to terminate their interests in a property.
Types of Legal Partitions
When filing a partition action, you must specify which type of legal partition you are seeking: partition by sale, partition in kind or partition by appraisal.
Keystone goes over the meaning and implications of each partition type below.
Partition by Sale
In a partition by sale, a court order to force the sale of a property is issued. Once the sale is completed, proceeds are divided among the co-owners according to their proportional interests.
A partition by sale can be ordered to take place via a private sale, public auction or by listing the property on the open market with help from a licensed real estate broker.
Partition in Kind
In a partition in kind, the court issues an order forcing the physical division of property, granting each co-owner an undivided interest in their respective share.
When it is possible to physically divide property fairly and equitably — for instance, splitting a rental property with four units of equal value among four co-owners with equal interests — the court generally favors this option to avoid forcing anyone to sell against their will.
Partition by Appraisal
In a partition by appraisal, the court orders one or more co-owners to purchase the other co-owners’ interests on certain agreed-upon terms following an independent appraisal of the property.
Key Considerations Before Filing a Partition Action
Remember: Partition actions come with pros and cons, so it’s important to carefully consider your personal situation — or, preferably, to consult a skilled partition lawyer — before proceeding.
The downsides of partition actions are what you might expect. Not only can partition actions be expensive and time-consuming, but they can take an emotional toll as well.
On the other hand, an advantage of partition actions is their ability to effectively and fairly resolve longstanding co-ownership disputes over property when co-owners are unable to independently reach an agreement.
Although not guaranteed, partition actions also may enable co-owners to recoup their attorney’s fees and request reimbursement of expenditures related to the property, such as mortgage payments, taxes, insurance premiums and costs for repairs and renovations.
If you are involved (or plan to be involved) in a property dispute, but are unsure whether a partition action is the right solution, a qualified partition attorney can help you weigh the pros against the cons to determine the best path forward.
How to File a Partition Action in California
Curious how to initiate an action for partition? The steps below outline the process. Keep in mind, however, that you cannot force a sale of jointly owned property without first offering non-partitioning co-owners the opportunity to buy out your interest for fair market value.
It’s also important to mention that an out-of-court agreement can be reached between the parties even if a partition action has already been filed.
1. File a Petition for Partition
To force a sale of a jointly owned property through a partition action, you must file a petition for partition with the court. It’s important to note that California does not have fill-in-the-blank petition action forms — which means the petitioning party will need to draft the complaint from scratch.
Due to the highly procedural nature of partition actions and the complexities that can arise from them — such as the appointment of a referee (a neutral third party appointed to supervise the division or sale of property) and accounting disputes — it is not advisable to attempt any part of this process without having an experienced partition attorney guiding you. It is especially crucial that your attorney prepare the initial complaint, since it can have an impact on your chances of a successful outcome.
Petitions for partition must include the following information:
- The ownership interest(s) of the petitioner(s)
- The ownership interest(s) of the respondents — to the extent they’re known
- The type of partition being sought (i.e., partition by sale, partition in kind or partition by appraisal)
- Any requests for adjustments, accountings or offsets
Once your complaint is complete, file it with the courthouse in the county where the property at issue is located.
2. Serve Notice to Interested Parties
Because anyone who could be affected by your partition case must be given an opportunity to respond, it is essential to timely serve them with the court summons and complaint — typically within 60 days of filing the complaint. Defendants generally have 30 days from the date of service to file a response.
It is also crucial that you notify interested parties at least 15 days in advance of any partition hearing.
Interested parties generally include the named defendants and, in some cases, lienholders.
3. Record a Lis Pendens
Once the complaint is submitted, it’s vital to record a lis pendens — previously called a Notice of Pendency of Action — with the recorder’s office in the county where the property is located.
A lis pendens notifies anyone showing interest in the property that a legal proceeding surrounding the property is ongoing.
4. Decide Whether to Attempt an Out-of-Court Settlement or Litigate
Filing a partition action with the court does not eliminate the possibility of resolving the matter outside of court through mediation — a process in which a neutral third party facilitates negotiations among co-owners. Mediation is often faster and more cost-effective than full litigation.
However, the fact you are considering filing a partition lawsuit suggests that attempts to reach an agreement with the other co-owners may have failed. In such cases, litigating the matter through trial may be the only realistic path forward. While litigation can be time-consuming and expensive, one potential benefit is that a successful outcome may allow you to recover your attorney’s fees and costs.
Importantly, the court cannot compel a co-owner to keep their interest in a property against their will. For this reason, courts typically grant partitions rather than deny them. If a property can be physically divided fairly and equitably, the court will generally order a partition in kind. If such a division is impractical, the court is more likely to issue an order forcing the sale of the property.
Partition Action FAQs
Still confused about partition actions? Explore the frequently asked questions below for additional guidance.
For specific queries, we advise reaching out to our firm directly. Our legal team is standing by to assist.
How does a partition sale work?
A partition sale may occur when co-owners of a property cannot agree on whether to sell a property or on how to divide it. Instead of physically splitting the land or home (called partition by kind), the court orders the property to be sold, typically on the open market or through public auction.
The partition sale process is initiated when a co-owner files a partition action. If the court finds that a property cannot be fairly and equitably divided, it orders a sale.
Once sold, net proceeds are split among the co-owners according to their ownership shares, but only after all debts and liens attached to the property have been paid off.
Although a partition sale provides for each co-owner to receive their fair share of a property’s value, it can be expensive and time-consuming — and may even strain family relationships. For this reason, alternative resolutions are often attempted before resorting to a partition sale.
Who pays for a partition action?
Because awards of attorney’s fees and costs are never guaranteed, it’s best to prepare to pay upfront for your partition case.
This may not be the news you were hoping for, given the high costs associated with partition actions. However, there’s reason for optimism: Attorney’s fees and other expenses are often recoverable, either from the opposing party or from the proceeds of the sale.
Still, the cost of a partition action will depend on the nature of the litigation: the more complex the litigation, the more expensive the partition action likely will be. Another important factor when it comes to cost is the parties’ willingness to settle outside of court.
In addition to legal fees, parties may be able to recover payments they made related to the property that were beyond their ownership interest. Recoverable expenditures may include everything from mortgage payments and taxes to contributions to improvements, renovations or upkeep of the property.
To ensure costs are recoverable, it is essential to keep thorough records of every payment made in relation to a jointly owned property.
How do you win a partition action?
Understanding how to win a partition action often comes down to presenting strong evidence of a stalemate among co-owners and demonstrating why a fair and equitable division or sale of the property is necessary.
That said, winning a partition action can mean different things to different individuals. For example, if you solely are seeking for the other co-owners to buy you out of your ownership interest for a fair price, it may not be important to you whether there is a forced sale of the property or not.
Before initiating a partition action, it’s important to get clear on the outcome you’re seeking — i.e., what winning means to you — and the best path for achieving it.
How long does it take to force a sale of property?
From start to finish, forcing the sale of a property through a partition action can take around one to two years — though the timeline may be shortened or extended depending on the complexity of the case.
It’s easy to see why partition actions often take considerable time. The process begins with filing a complaint and serving it to all interested parties, followed by potential court hearings and motions. An appraisal of the property may also be required, and the parties might attempt to resolve the dispute through mediation. If no agreement is reached, the case could proceed to trial. When a partition by sale is ordered, the property may need to be listed on the open market or offered at public auction, and even after a sale, it can remain in escrow for several months.
In short, a partition action is rarely a simple court case; it is a complex, multi-step process that typically requires significant time to navigate.
When do you use a partition in kind vs. a partition by sale?
A court will generally order a partition in kind rather than a partition by sale when the property can be physically divided fairly and equitably. A partition in kind allows co-owners who wish to retain their interests to do so, while giving those who do not want to continue ownership a way to exit.
If a party seeks a partition by sale instead of a partition in kind, the burden of proof is on them to show that the property cannot be divided fairly and equitably or that dividing it would significantly reduce the value of each co-owner’s share.
Will you receive a letter warning of a partition action?
Yes, you typically will receive notice of a partition action from the petitioner. Once notice is served, you will have 30 days to file a response.
Can a partition action be stopped?
Yes, although successfully stopping a partition action is rare. Courts generally cannot force a co-owner to retain ownership of a property they no longer want, since doing so could create financial burdens. However, the court can require co-owners to sell their interests, ensuring they are fairly compensated for their share.
What is a deed of partition?
Once a partition is ordered — whether the co-owners agree to sell or physically divide the property — a deed of partition formally specifies how the property (or the proceeds from its sale) is to be distributed among the co-owners.
Where can I find California partition action forms?
There are no official partition action forms in California. To file a partition action, you must prepare the complaint from scratch with help from a skilled partition attorney.
Can a joint tenancy be partitioned?
Yes, a joint tenancy can be partitioned. While joint tenants share equal ownership with rights of survivorship, a co-owner can challenge or remove these rights in certain circumstances. If the co-owners cannot agree, a partition action can be filed to physically divide the property or, if division is impractical, to force its sale.
Interested in filing a partition action?
Are you wondering how to file a partition action? Want to learn more about the alternatives that are available to forcing the sale of jointly owned property?
Keystone’s experienced probate lawyers deal in real estate co-ownership disputes every day and can help you achieve the best possible outcome for your case. Call us today to learn how we can help.
