Everything You Need to Know About California Partition Actions
Real estate is and continues to be one of the most lucrative investments that people can make. The demand for real property, like a family home, parcel of land or townhouse, also makes it one of the most expensive assets that people ever purchase. Often times, individuals look to share the cost of purchasing real estate with other parties such as investors, family members or friends, each being considered a co-owner of the property. Additionally, when real estate is inherited, property is commonly transferred multiple owners.
Joint ownership can work successfully in many cases, but disagreement and disputes between co-owners are also not uncommon. What happens when joint owners disagree on the best use of the property? If one of the owners wants to sell, but the other one doesn’t want to? What should be done when one co-owner is in possession of the property, while the other owners are paying the expenses or simply wish to sell?
These disputes between co-owners of property can be resolved through a partition action in California. If you are looking to understand what partition is and how you can use it to end your co-ownership relationship, look no further because the experienced partition lawyers at Talkov Law have written the ultimate guide to partition action in California.
What is a partition action?
A partition action is the only court ordered process in California to bring an end to real estate co-ownership disputes. Under California Code of Civil Procedure Section 872.210, a partition action is a legal process taken to divide a California real estate equitably among its co-owners. When there is disagreement where one or more co-owner of a property may want to sell the property, but another co-owner does not agree to sell, a partition action can help force the sale of the property fairly and equitably among the joint owners.
When do I need a partition action?
In California, most people consider initiating a partition action when there is a disagreement between joint owners of a property or a co-owner is looking to end a co-ownership arrangement. These disagreements may involve one owner requesting to sell their interest in a property, but the other shared owners are unwilling to sell or can’t agree on a fair price. A conflict on diverging interest may also occur where joint owners disagree on the best use of the property. You should consider filing a partition action if you have co-ownership of a property and your desire to use or sell the property conflicts with the other party.
It is very easy for joint ownership of real estate cause issues when co-owners simply have conflicting interests. Thus, a partition action is a tool to help you end a troubling relationship. If you have tried to negotiate with your co-owners, but they still refuse to compromise with your interests, then you should seek a partition action. A partition action can be filed by any co-owner in property with joint ownership, no matter how large or small the interest of co-owner. Any property, commercial, residential or vacant land, that has multiple owners can be subject of a partition action.
What happens in a partition action?
In a partition action, a co-owner of a property is taking legal action to fairly divide the property among all co-owners of the property. This type of lawsuit can end in one of two ways: either the court orders a forced sale of the jointly owned property and then the sale proceeds is divided equally among each owner, known as partition by sale, or the court divides the property into pieces and gives each owner an undivided interest in their own separate piece, known as partition in kind. In some rare instances. the court may also award ownership to one person and order them to buy out the others. If this is agreed between the parties, this is known as partition by appraisal.
Additionally, even after a lawsuit is filed, the co-owners can agree to sell the property either to each other or to a third party without court intervention and reach a settlement. This settlement agreement should be drafted by the counsel to ensure it is legally binding.
The process of a partition action can be time consuming and complex. Therefore, many people who are seeking a partition action or have been served with one will often retain a real estate partition action attorney to help them navigate the legal process.
How to file a partition action?
In order to file a partition action, it is best practice to hire a partition attorney to help navigate you through the legal process of filing a partition action in California. When looking to hire a partition lawyer, it would be ideal to be prepared by having certain documents on hand. Documents relating to the ownership of the property such as the grant deed, trust deed, will and other agreement is necessary for the attorney to properly evaluate the case.
After seeking and hiring a partition attorney, the counsel then files a complaint via a petition for partition action in the county where the property is located. Once the complaint is filed, a notice of pendency of action (lis pendens) is recorded with the County Recorders Office. This notifies anyone interested in the property that a legal action is in process. The court only rescinds the notice once the partition is accomplished or the complaint is dropped. Eventually, the case will come before the court, at which time the judge will make a determination of the partition request. If the request is upheld, the court will appoint a referee to divide or sell the property.
What are the pros and cons of a partition action?
As there is with all decisions, there are upsides and downsides to a partition action. Partition action can be a complicated process and there are many benefits and challenges to this legal process. Thus, it is very important to understand both the pros and cons of partition in order to help you determine if partition is the correct legal course of action to take in your real estate dispute.
PROS – Benefits of a partition action
- Best option when co-owners of a property cannot agree to terms
- Ensures an end to any real estate dispute where a party refuse to cooperate
- Possibility of recovering reimbursement for costs on payment of mortgage, taxes, insurance, repairs and renovations
- Potential recovery of attorney’s fees and costs
CONS – Challenges of a partition action
- Some partition cases may be time consuming
- Being forced to interact through the courts with your co-owner, but at least this will eventually end
- Risk of the property being sold to a third party, though this will result in the proceeds being split by the court among all the owners
Partition action forms
Each partition action presents unique challenges. However, all partition actions start with a complaint for partition, usually by sale. We have provided online a free California partition complaint form intended for use by lawyers with experience in real estate disputes. It is important to contact a real estate attorney to determine which form would be appropriate, even if you decide to represent yourself.
How much does a partition action cost? What is the cost for attorney fees?
In California, the cost of partition action with attorneys fees can vary depending on the complexity of the litigation involved. Based on dozens of partition lawsuits managed by the real estate attorneys at Talkov Law, the average cost of attorney’s fees in a partition action is around $4,000 to $8,000 per defendant or plaintiff. Costs can be higher if cases become more complex. However, in certain cases where properties have equity, Talkov Law may be able to take the case on a minimal retainer with fees to be paid from escrow when the property is sold or refinanced.
The cost of a partition that can be recovered in a partition action include:
- Reasonable attorney’s fees incurred
- The fee and expenses of the referee
- The compensation provided by contract for services or other persons employed by the referee
- The reasonable costs of a title report
- Other disbursements or expenses determined by the court
The good news is that attorney’s fees may be recoverable in a partition action. California Code of Civil Procedure 874.040 states that “the court shall apportion the costs of partition among the parties in proportion to their interests or make such other apportionment as may be equitable,” meaning the court can force the other party to pay for some or all of the fees associated with bringing or defending against the partition action.
In a case where you have a lack of cooperation from a co-owner, attorney’s fees can also be recovered in a partition for a non-cooperative co-owner. Ultimately, it is imperative to have a skilled partition attorney in California to evaluate your situation and advise you on a plan of action to ensure you get the best outcome possible in your situation for the least amount of expenses.
Can you recover payments benefiting the property in a partition action?
The great news about a partition action is that parties can recover all of the mortgage payments, taxes, insurance, repairs, improvements and other expenditures made in excess of their ownership interest. The seminal case of Wallace v. Daley (1990) 220 Cal.App. 3d 1028 , 1036 explained as follows: “Every partition action includes a final accounting according to the principles of equity for both charges and credits upon each co-tenant’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.” It is important to organize all documents showing these offsets available in a partition action to develop an appropriate strategy when consulting with a partition lawyer in California.
How to win a partition action?
In a partition action, there is a lot at stake as real estate is often so expensive and is always unique. What it means to win a partition action might be different for each person. For some, they seek to obtain sole title to their family estate. For others, they simply want to be paid fairly for their co-ownership interest in a property. Therefore, it is important to know what your goal is prior to initiating a partition lawsuit. Whether it may be seeking to divide the land or receiving proceeds from the sale of the property, ensuring that you know what you want will give you a better chance at winning.
Additionally, hiring a skilled and experienced partition attorney will influence the outcome of a partition action in your favor. A partition lawyer who has experience in real estate litigation will be extremely helpful in ensuring that your interests are protected and you achieve the desired outcome. A partition action lawyer will help litigate for you in court as well as helping you reach a settlement outside of the court. Therefore, making sure you have a highly knowledgeable partition attorney on your side will be critical in the outcome of your case.
How long does it take to win a partition action?
The length of time it takes to resolve a partition action depends on the circumstances and the complexity of each case. The length of time it takes to win a partition action can take anywhere from a couple of months to reach a settlement agreement or it could take years if the partition is contested by the other parties. The time needed to reach a resolution also depends on the efficiency and effectiveness of legal counsel. An experienced partition real estate lawyer can possibly help you settle your case sooner.
Can a partition action be stopped? How do you stop a partition action?
Generally, the right to a partition action is absolute meaning that the right to partition a property is achievable by any co-owner, no matter how small or large their interest in the property may be. Once filed with the courts, a partition action cannot be “stopped” by a party who does not wish to sell the property unless the parties can resolve the dispute by settling. However, there are techniques to bring a stop to the action through an appropriate resolution that will obtain the consent of the other co-owners.
Absent an agreement or defense, the county court will typically force a sale of the property, then divide the proceeds between the co-owners. Even if one of the co-owners currently lives in the property, the partition action will typically force the sale of the property and can even force a co-owner to vacate if they do not cooperate in the sale. So, in short, it is typically very uncommon for a partition action to be stopped, except in rare cases of fraud.
Affirmative defenses to a partition action
Generally, any co-owner has the right to file a partition action under the California Law. However, the most common exceptions to this rule are if:
- You waived the right to partition, which would generally occur by contract or otherwise in writing; or
- The property is community property (property bought while in a marriage). This division would be consider a family law matter and it would be best to seek out a property division attorney.
There are sometimes other defenses available to help you fight against a partition action. As explained by our article on affirmative defenses to a partition action in California, defendants can sometimes be successful at challenging a plaintiff’s standing, or raising offsets against the co-owner, particularly if the potentially offsets exceed the plaintiff’s equity in the property. To learn more about each affirmative defense to a partition action, it would be wise to consult counsel who can examine what defenses may be available to you.
Do I need a partition action lawyer?
Technically, you do not need a partition attorney to represent you if you own the property in your individual name, as opposed to holding the interest in the property within a corporation or limited liability company (LLC). However, it is not advisable for you to go into a partition lawsuit without legal representation. Partition law is an extremely complex and time consuming process, which involves very technical details. To ensure that a partition action proceeds smoothly given the unique complications in every case, co-owners should seek the advice of an experienced partition attorney. It is crucial to work with an experienced partition attorney to help you end a soured real estate co-ownership relationship. Hiring a real estate partition lawyer will ensure your rights and interests are protected.
How do I choose a partition action attorney?
If you’re wondering what type of lawyer should you seek out to help represent you in a partition action, the most common type is a real estate attorney who has experience in real estate litigation. This will ensure that your rights are protected if disputes arise in the partition process. A real estate attorney has vast knowledge about the different rules and regulations pertaining to real estate and will be well equipped to help you in filing a partition action. In addition, finding an experienced partition lawyer who has dealt with numerous partition action cases in your county or surrounding areas is imperative in achieving your ideal outcome. Make sure you choose a skilled partition real estate attorney.
Hire an experienced partition attorney at Talkov Law in Riverside, Orange, Los Angeles, and San Bernardino Counties
Here at Talkov Law, our knowledgeable partition real estate attorneys are veterans in partition action matters, having had handled countless cases in Riverside, Orange, Los Angeles, and San Bernardino Counties. Our partition action attorneys regularly represent co-owners in partition actions to ensure their rights and interests are protected.
If you are looking to end your co-ownership real estate relationship, speak to an experienced and creative real estate partition action lawyer. Call Talkov Law today at (844) 4-TALKOV (825568) or contact us online for a free analysis of your situation!