Understanding Co-Ownership in Orange County
Shared ownership of property in California is becoming more popular every day, especially in Orange County. With record breaking demand for real estate in Rancho Santa Margarita, California and statewide, many buyers find that owning a home with another (or several other) co-owners among the population of 47,896 in Rancho Santa Margarita is the most affordable way to invest in real estate. Whether these co-owners are romantic partners, family members, friends, or other investors, it is possible for these relationships to sour over time, making owning shared real estate together unbearable. California allows for what is known as a partition action to force the sale of property among co-owners, even if one or more co-owners doesn’t want to sell.
What is a Partition Action in California?
A partition action is a court ordered process to separate joint owners’ respective interests in real estate.California Code of Civil Procedure 872.240 It is the only court ordered remedy for joint owners who disagree on what to do with a property. A partition action will ensure sale or division of a property equitably among its co-owners. A partition is achievable no matter the size of your interest in the property, as well as whether your co-owner is belligerent, uncommunicative, or just doesn’t want to sell the property. In fact, California courts have unequivocally stated that the “right to partition is absolute.”Bacon v. Wahrhaftig (1950) 97 Cal.App. 2d 599, 603.
How Does a Partition Action Work?
A partition action may be a last resort for many co-owners in Rancho Santa Margarita who have tried reasoning with their uncooperative co-owner(s). Once all options to reason with this person have been exhausted, a partition action is the only way to ensure an equitable division of jointly owned real estate. It is highly advisable to consult with a partition lawyer to ensure that all documents are properly filed with the court. A partition attorney in California can help you organize important documents to proceed with the partition, including, but not limited to: the grant deed, trust deed, will, and any other documents the attorney may need to evaluate your situation.
A partition action officially begins when one co-owner files a complaint for a petition for partition with the court. After the petition has been filed, a lis pendens, or a notice of pendency of action, is recorded with the county recorder’s office. The lis pendens serves as constructive notice for anyone interested in the property that there is pending legal action affecting title to, or possession of, the property. The lis pendens will remain on the property until the partition is complete or the complaint is dropped. Assuming the partition suit continues forward, it will be presented to the court at which time the judge will make the final decision. A partition request that is upheld by the judge will result in the court appointing a partition referee. A partition referee is a neutral, third party whose job is to fairly divide the property or distribute the proceeds of the sale of the property.
How Long Does a Partition Action Take in Orange County?
The length of time it takes to resolve a partition action varies greatly depending on the complexity of each case. Best case scenario, it is possible to reach a settlement agreement in as short as a few months. However, in a worst case scenario where the partition is hotly contested by other parties, it may take a year or two (rarely longer) for the partition action to be completed. An efficient and experienced partition attorney serving Rancho Santa Margarita can help you achieve a resolution in your partition case in the most time-efficient manner possible.
Who Can File a Partition Action?
The laws in Rancho Santa Margarita, and throughout California, are that there are four distinct types of co-ownership: joint tenancy (with rights of survivorship), tenancy in common, partnership, and community property. Any real estate owned by joint tenants, tenants in common, or under a partnership is subject to partition law. Community property, however, is not. Property that has been purchased by spouses during the course of their marriage is community property, and therefore does not fall under the umbrella of partition law, unless it was already distributed to the former marital partners in the divorce. A family law attorney with experience in division of community property can assist in such scenarios.
A partition action is often filed by a property co-owner who wants to sell the property but his or her co-owners are unwilling to do so. Some common examples where filing a partition may be the best course of action are:
- A brother and sister inherit a California property from their parents. Each sibling is a joint tenant with 50% ownership in the home. The sister has been living in the home, but the brother lives across the country and gets no use out of this inherited property. The brother wants to sell the home but the sister refuses to cooperate. The brother files a partition action in California to force the sale of the house. He will then be able to collect his share (50%) of the proceeds from the sale of the home.
- A boyfriend and girlfriend buy a home together as tenants in common. After purchasing the home, the couple decides to break up. The boyfriend continues living in the home but the girlfriend moves out. However, the girlfriend paid the entire down payment and still makes all the mortgage payments. The girlfriend may file a petition for partition to force the sale of the home and obtain the value of her interest in the home. Additionally, she may be subject to equitable apportionment of payments she made toward the house.
- Three friends purchase a plot of land with the intent to build on it. One friend has a 50% interest in the land and the other two friends have 25% interests. Their plans to build on the land fall apart, and they can’t decide on what to do with the land. Any of the friends may petition for a partition, including a partition in kind. A partition in kind would allow each of the friends to become an owner of his/her proportion of the land. A partition in kind is rare due to the difficult nature of dividing the land equitably.
How Much Does a Partition Action Cost?
The cost of a partition action in Rancho Santa Margarita can vary widely depending on the complexity of the case. A typical partition action usually costs between $5,000 and $12,000, with about $8,000 being the most common cost. However, difficulty locating a defendant, motion and opposition to appointment of a partition referee, disagreement on property sale price, and other issues may raise the cost of your partition action. An experienced partition lawyer can mitigate costs and resolve your co-ownership dispute with maximum efficiency.
Who Pays for a Partition Action?
In Rancho Santa Margarita, California and elsewhere in the United States, each party typically pays for their own attorney’s fees (known as the “American Rule”). However, California partition law allows for an exception to this rule, stating 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.” California Code of Civil Procedure 874.040 Indeed, the court may award “reasonable attorney’s fees incurred or paid by a party for the common benefit.” California Code of Civil Procedure 874.010(a)
An experienced partition attorney understands how to keep attorney’s fees, and the overall cost of a partition action, reasonable for all parties involved.
Contact an Experienced Partition Attorney in Rancho Santa Margarita, California
If you want to end your co-ownership relationship, but your co-owner won’t agree, a partition action is your only option. Our experienced partition lawyer serving Rancho Santa Margarita have years of experience ending co-ownership disputes in California and can help you unlock the equity in your Orange County property. For a free, 15 minute consultation with an experienced partition attorney at Partition Lawyer California, call (800) 443-3300 or fill out a contact form online.