Partition - When a Co-Owner of Real Estate Refuses to Sell
To partition or not to partition, that is the question. Partition is a legal activity instituted for the purpose of dividing real estate owned by two or more people. If one or more of the co-owners of real estate is or are unwilling to sell the asset and divide the proceeds of sale in accordance with all of the co-owners' rights interests, it is the only way that a someone who owns a share of real estate as a tenant in base or joint tenant can separate his or her interest from the other co-owners.
Partition - When a Co-Owner of Real Estate Refuses to Sell
A joint tenancy is a form of rights in which the co-owners own a asset equally. If one dies, the other automatically inherits the whole property. By contrast, a tenancy in base is a type of joint tenancy of asset without right of survivorship; each co-owner's portion is distributable under a will. Thus, in a tenancy in base each can leave his or her interest upon death to beneficiaries of his selecting instead of to the other owners, as is required with joint tenancy. The type of rights is determined by reading the record in the deed. In New Jersey, two people, other than married couples, are presumed to own asset as tenants in base unless they've agreed otherwise in writing in the deed. If two or more individuals inherit asset then the last will and testament of the decedent will specify the type of joint ownership.
Partition of real estate can be in kind, meaning that the asset is certainly physically divided and split up among the owners. If that is not possible, and it most generally is not possible, then a court ultimately will order a group or private sale of the real estate and the division of the sale proceeds among the parties agreeing to their respective interests. Thus, it is common, and often in the parties' mutual best interest, to work out a deal in which one co-owner buys out the other(s).
A real estate attorney may have to file partition actions between parent and child, brother and sister, boyfriend and girlfriend and gay couples. When a married join owns asset and seeks to end the marriage and divide the property, the case will be heard in the excellent Court, Chancery Division, family Part, as part of the divorce. For all other co-owners of asset there is no other recourse than to file a Complaint in the Chancery Division, general Equity Part. Partition is an equitable remedy so the Chancery Judge will hear all the facts and make a decision based on equitable factors.
These matters are regularly very emotional because not only do they signify the end of a joint rights of property, but they also signify the end of a relationship. A real estate attorney may be helpful in facilitating communication between the parties.
In many instances, one party has been paying the majority of the maintenance expenses of the asset and residing on the asset while the other party is not residing there, but also not paying any of the ongoing expenses of the property. Consequently, the party in rights of the asset believes that he/she should be compensated for paying all the expenses and the other believes he/she should be compensated for not having use of the property. In order to reconcile both parties' contentious interests, the Courts have established general rules with regard to partition:
1. On a sale of generally owned real estate, an owner who has paid less than his pro-rata share of operating and maintenance expenses of the property, must pay over his/her share to the co-owner who has contributed more than his pro-rata share, and that is true even if the previous had been out of rights and the latter in rights of the property.
2. The fact that one tenant in base occupies the property, and the other does not, imposes no enforcement on the previous to make any offering to the latter. All tenants in base have a right to occupy all of the asset and if one chooses not to do so, that does not give him the right to enforce an "occupancy" fee on the other.
3. Notwithstanding those general rules, when, on a final accounting following sale, the co-owner who had been in sole rights of the asset demands offering toward operating and maintenance expenses from his co-owner, fairness and equity dictate that the one seeking that offering allow a corresponding prestige for the value of his sole occupancy of the premises. The party seeking the prestige for the other's occupancy of the asset has the burden of demonstrating the "actual rental value" of the asset enjoyed by the occupying co-tenant because generally the cotenant who is not excluding others is not accountable for use and occupation.
Thus, what a person's interest in the asset is for purposes of partition varies depending on the facts of each case. Even though there are general rules, because partition is an equitable matter, the decision in each case is up to the sound discretion of the judge.
It is very important to seek the advice of a considerable real estate attorney who has handled partition matters. Each partition matter is fact sensitive and you need a lawyer who will vigorously argue on your behalf. It is also important to support any documents related to the purchase and care of the property. If the parties have made any type of bargain with regard to the eventual sale of the property, the bargain must be in writing.
If you have any questions about partitioning a property, please do not hesitate to call us.
No comments:
Post a Comment