Code of Civil Procedure 872.140 CCP – Compensatory adjustment among parties; equity (Partition Actions)

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California Code of Civil Procedure 872.140 is the California partition statute that allows the court to distribute the proceeds of sale in a partition in an equitable manner. The statute provides that:

The court may, in all cases, order allowance, accounting, contribution, or other compensatory adjustment among the parties according to the principles of equity.

California Code of Civil Procedure 872.140

In the context of this statute, one court explained that: “There is merit to the contention a plaintiff may be generally entitled to an accounting by requesting a partition.”[1]Finney v. Gomez (2003) 111 Cal. App. 4th 527, 539

This court cited two commonly cited cases in which an accounting was upheld. Notably, the frequently cited case of Wallace v. Daley found that “Every partition action includes a final accounting according to the principles of equity for both charges and credits upon each cotenant’s interest. Credits include expenditures in excess of the co-tenant’s fractional share for necessary repairs, improvements that enhance the value of the property, taxes, payments of principal and interest on mortgages, and other liens, insurance for the common benefit, and protection and preservation of title.”[2]Wallace v. Daley (1990) 220 Cal.App.3d 1028, 1035

Even further, another court noted that: “Where one cotenant has paid more than his proportion of the purchase price of the land, he is entitled on partition to an accounting therefor.”[3]Demetris v. Demetris (1954) 125 Cal.App.2d 440, 445

Another common issue is whether a tenant-in-possession owes rental value to a tenant out-of-possession, or whether the tenant-in-possession who pays all expenses can collect from the tenant-out-possession who pays nothing. This issue is fact-sensitive, but one court “conclude[d] that in the instant action it was proper for the court to offset the reasonable value of the use of plaintiff’s interest in the property against the payments for interest, taxes and insurance made by defendants in preservation of the property.” [4]Hunter v. Schultz (1966) 240 Cal.App. 2d 24, 32

The bottom line is that parties in a partition action are entitled to request that the court divide the proceeds of sale in a manner that includes the uneven payments by parties for the mortgage, taxes, insurance, repairs, improvements, down payment, and any other matter.

References

References
1 Finney v. Gomez (2003) 111 Cal. App. 4th 527, 539
2 Wallace v. Daley (1990) 220 Cal.App.3d 1028, 1035
3 Demetris v. Demetris (1954) 125 Cal.App.2d 440, 445
4 Hunter v. Schultz (1966) 240 Cal.App. 2d 24, 32
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