Can the co-owner of property force the sale of the home
Home ownership has long been the epitome of the American Dream. However, with the cost of real property skyrocketing each year, buyers are often forced to have a co-owner listed on title in order to qualify for the loan. As long as the co-owners remain amicable and neither owner incurs a liability that would subject the property to a lien, joint ownership can work wonderfully. However, what happens if one owner decides he wants to buy another property and needs the equity from the first property in order to buy the next one? What happens if both owners agree to sell the property but cannot agree on how to divide the sale proceeds?
When a property is owned by two or more parties and one party refuses to sell their portion of the property or cannot agree on how to divide it, the owner can file a complaint for partition with the Superior Court in the county where the property is located. A partition action is a request for a court order dividing the real property either “in kind” or “by sale” pursuant to California Code of Civil Procedure §872.210. An “in kind” division is only possible when the property at issue can physically be divided such as land. “In kind” division cannot occur for most residential property in California. The typical form of partition order will be partition by sale, which is a court order forcing the sale of the real property. Most partition actions that do not settle are granted by the Court.
When deciding the outcome of a partition action, the Court will first determine each co-owners’ percentage share of the property. The Court will also take into account any expenses incurred by either owner such as property taxes, mortgage payments, insurance, repairs, and improvements. The Court may order that the party that incurred these expenses will be reimbursed from the sale proceeds prior to the division of the money.
Partition actions can be expensive, especially for the party trying to stop the sale. First a referee appointed by the court to facilitate the sale of the property must be paid. Second, the party trying to stop the sale will need to pay his or her court costs and filing fees. Finally, the unsuccessful party in a partition action will likely be ordered to pay the attorneys’ fees and costs of the prevailing party. By the time the sale occurs, the party that tried to stop the sale may end up with nothing.
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