Understanding Partition Actions

If you own real estate jointly with another person or people, there may come a point where you or one or more of your co-owners wants to sell the property. However, if at least one co-owner objects to selling, those that want to sell will need to pursue a type of legal relief known as a partition action.

 What Is a Partition Action?

A partition action is a lawsuit to force the sale of co-owned real estate. Partition actions are typically filed when one co-owner wants to sell the property but another co-owner refuses to sell. A partition action can help facilitate the equitable sale of the property in a manner fair to all the owners.

 When Are Partition Actions Used?

Under California law, anyone who owns real property jointly with another person has the legal right to sell their interest in the property by dissolving the joint ownership. Partition actions frequently arise in circumstances such as:

• When family members jointly inherit property
• When a divorcing couple needs to resolve ownership of jointly owned property
• When multiple partners invest in a piece of real estate

While joint owners normally have the absolute right under the law to pursue a partition action, a few exceptions to this right include:

• The joint owner seeking partition had waived their right in writing or by contract to pursue partition
• The property qualifies as community property, in which case division of the property must be pursued as a family law matter rather than in a partition action

 Types of Partition

There are three types of partition actions that may be filed in court:

• Partition in kind: A partition in kind involves joint owners reaching an agreement to divide their ownership rights into separate, distinct fractional interests in the property. Each party would then be entitled to dispose of their interest as they wish.
• Partition by appraisal: This type of partition involves first appraising the value of the property prior to it being sold. Partitions by appraisal are normally used when one or more of the joint owners wishes to buy out the interest or interests of the joint owners who wish to sell, rather than selling the property to a third party.
• Partition by judgment: A partition by judgment involves a court-directed partition. The court will be called on to first decide on each party’s share of interest in the property. The court can then either order a partition in kind and leave the parties with their individual interests in the property, or the court may order a sale of the property with the proceeds distributed to the parties in proportion to their respective shares of interest.

 What Ownership Arrangements Can Lead to a Partition Action?

Real estate may be held in several different types of co-ownership that can ultimately give rise to a partition action. These include:

• Tenancy in common, in which ownership of the property is held by two or more persons. Tenants in common may have the right to encumber or dispose of their ownership interest, but at a minimum the interest will pass on to the tenant-in-common’s heir upon their death.
• Joint tenancy, which must be expressly agreed upon by all parties. In a joint tenancy, two or more individuals hold equal, undivided interests in the property. Joint tenancy also normally implies a right of survivorship. When one joint tenant passes away, their interests is automatically passed onto the surviving tenants.
• Tenancy by the entirety, a form of joint tenancy unique to married couples. Tenancies by the entirety are normally only partitioned as part of the divorce process.

 Contact Us Today for Help

If you are considering filing a partition action or have been served with papers in a partition action, contact Wagner Zemming Christensen, LLP today for a confidential consultation with our Riverside, CA commercial real estate lawyers about your case.