So, you’ve inherited some property and want to sell. Unfortunately, there’s at least one other owner and they either refuse to let go of the property or they are dragging their feet. If you and the other owner or owners cannot agree, there’s a solution: partition.
People have been fighting over what to do with property as long as people have owned property. Because of people’s inherit propensity to disagree, the legal remedy of partition has been utilized for generations as a resolution to disputes among owners. Essentially a partition is simply one or more of the owners exercising their right to hold the interest separate from the other owners.
What is a Partition?
There are two types of partitions partition in kind and sale in lieu of partition. Courts favor a partition in kind if it is available. A partition in kind means that the property in question is physically split into multiple parts and distributed to each co-owner. For example, let’s say there’s a 100-acre tract of land owned by person A and Person B. Person A wants to sell but person B refuses. So, person A petitions the court for a partition. The court would likely split the land into two 50-acre tracts and give them to person A and B respectively. Now person A is free to sell her part.
Even though a partition in kind is favored, there are many instances where this type of partition could materially injure one or more of the owners. For example, if the land cannot be split equally because of the physical nature of the property or if the property in question is just a house on a less than 1-acre lot. In these situations, a sale in lieu of partition is more appropriate.
If the property is sold in lieu of actual partition, the proceeds of the sale of the property are split among the owners of the property based on their ownership interest. So, if someone owns 10% of property, they will be entitled to 10% of the proceeds of the sale, with one small caveat.
When it comes to forcing the sale of property, the subject of cost will inevitably arise because, usually, one of the owners has kept up the property up to the point of the partition. For example, all owners of the property are liable for the property taxes. The property taxes must still be paid, even if one owner refuses to chip in their fair share. This, many times, results in one owner bearing the costs for the others. This unfairness tends to incentivize partition of the property, so that the responsible owner is not punished. The partition fixes the issue going forward, but what about the money that’s been paid up to that point?
Thankfully, the courts have recognized that one or more of the parties may have had to pay more than their share of costs for the property. Thus, the law in North Carolina allows for an owner to recover costs they’ve paid to maintain the property through the partition process. Although, the owner must be able to prove such payment through appropriate documentation.
If you are in the position where you own property with another and you cannot come to an agreement on what to do with or how to pay for the property, a partition may be right for you. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.
Brenton S. Begley
Elder Law Attorney
McIntyre Elder Law
“We help seniors maintain their lifestyle and preserve their legacies.”