Co-owners of real estate have an absolute right to sell their interest in that property. Despite that absolute right to sell their interest in the property, it is not uncommon for co-owners of real property to disagree as to whether to sell the property.
When one owner of property wants to sell the property (“Selling Owner”), but another owner of the property refuses to consent to a sale of the property (“Non-selling Owner”), the Selling Owner has a couple of options.
First, if practical, the Selling Owner can sell just their interest in the property (and not the Non-selling Owner’s interest). As a practical matter, however, it is rare that this option is realistic. Typically, the only party that would have an interest in purchasing a part interest in the property would be the Non-selling Owner.
If the Non-selling Owner is not interested in buying out the Selling Owner, there is typically only one other option available to the Selling Owner, to file a lawsuit, known as a partition action. A partition action is an action that one owner of real property files against all of the other owners of the property to obtain a court judgment forcing the sale of the property.
Partition actions are usually simple lawsuits since there typically are no importnant facts in dispute, and it is just a matter of getting the court to order a sale of the property. The court then issues an order, after hearing evidence on the issue, as to how to distribute the proceeds.
Because of the straightforward nature and simplicity of partition actions, once one co-owner files a partition action against another co-owner, the partition action usually settles. Unless there is a dispute regarding who has title, or there is a large disparity in the amounts that the co-owners paid towards maintaining the property, there is a strong financial incentive for the parties to agree to either a buyout of the Selling Owner by the Non-selling Owner, or for the sale of the property and distribution of the proceeds.
I regularly represent clients in partition actions. If you believe that you would benefit from a partition action or a consultation regarding a possible partition action, please feel free to contact me to arrange for a consultation at (510) 465-0025.