What is a partition lawsuit in California real estate matters? As experienced San Diego real estate attorneys with more than four decades of service to the San Diego commercial and residential real estate community we are often asked “how can we get (named party or entity) off of the title to our property?” Sometimes business or personal relationships simply don’t work out. This is common in commercial real estate transactions where multiple individuals or business entities purchase an asset or parcel of real estate.
In some cases, agreements can be negotiated between the parties that smoothly transition ownership interest from one party to another. In other cases, a legal action known as a “partition action or partition lawsuit” must be employed to seek the Court’s assistance with valuation of each ownership interest and ultimately the process for how the parties will acquire opposing ownership interests or force the sale of the property or asset.
A partition lawsuit in California real estate is governed by extensive law, and the judge will determine how the property interest is to be divided and valued. You can’t saw a commercial building or residential home into thirds. If the parties are not cooperating, the Judge may order an outside party known as a “receiver” to sell the property and distribute the proceeds accordingly. These cases can be quite litigious and we are often asked who will have to pay for the legal fees and costs associated with the partition lawsuit. In most cases, the Court will divide these costs evenly between the parties in proportion to their interest or ownership in the asset.
Pro-Tip: “There is a concept in California real estate law described as the “bundle of rights.” This extends to several specific rights and interests a property owner retains as it relates to the real estate they control. These include Rights of Possession, Enjoyment, Control, Exclusion and Division. Each of these rights may have an impact on the use of a property as well as its value. This “bundle of rights” also creates complex and substantial legal and financial challenges in a dispute or partition action.
In many cases involving multiple owners in a real estate venture, the owner who wishes to sell their interest is bought out by the remaining owner(s). However, in other situations, the remaining owners do not wish to or are unable to buy out the interest of the dissenting co-owner, or the parties cannot agree upon a fair valuation. These are separate problems, and this is why you need the advice and counsel of the Watkins Firm.” – Dan Watkins, Founding Partner
A partition lawsuit in California real estate disputes requires a balance of negotiation skill, and litigation expertise. If you are concerned about the division of property or are involved in an ownership position that is unproductive or adversarial we invite you to review our podcast Episode 43 – Real Estate Disputes as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
If it is possible to negotiate a solution, that is usually the most efficient, timely and cost-effective resolution. When necessary, we will help you to understand the option of a partition lawsuit in California and if it is in harmony with your business goals and objectives.