What Is The Procedure In A Partition Lawsuit?
The procedure for a partition lawsuit is specified by statute. The lawsuit must be filed in the county in which the property is located. The Complaint must name all parties who have any recorded interest in the property and whom the Plaintiff knows claims an interest in the property. Upon filing the Complaint, the Plaintiff must record a lis pendens. The judgment in a real estate partition lawsuit is binding on all parties to the action and on all persons who were not parties whose interest did not appear of record at the time the lis pendens was recorded.
The primary determination of the Court in a partition action is whether the property should be physically divided among the co-owners or sold. The Court will also determine the interests of the parties and the priority of all liens if that is an issue in the case. In California, it is presumed that it is more equitable to divide the property physically and distribute a portion to each co-owner in accordance with their respective interests. However, the Court may deem it to be more equitable to order a sale of the property and a distribution of the proceeds to the parties, according to their respective interests. In order to compel a sale rather than a physical division, the Plaintiff has the burden of proof to show either:
- a division into sub-parcels of equal value cannot be made; or
- a division of the land would substantially diminish the value of each party’s interest such that the portion received by each co-owner would be of substantially less value than the cash received on a sale.
What Is The Role Of A Receiver In A Partition Lawsuit?
The Court can appoint a receiver to manage the property while the partition action is pending or to enforce the judgment. The receiver may be assigned the duties of collecting rents, paying property related expenses (such as the mortgage, taxes, insurance and utilities), locating and hiring a real estate agent to sell the property, determining the appropriate listing price to market the property for sale, approving the terms and conditions of a sales agreement, and administering distribution of the sales proceeds to the co-owners.
The Court may also appoint a receiver to make a report on the facts and circumstances to determine whether the property should be physically divided or sold. The receiver’s recommendations are either accepted by the Court, modified or rejected.
If the partition is to be accomplished by appraisal whereby one party purchases the other party’s interest in the property, the Court can appoint a receiver to assure there is a proper appraisal of the property and of the separate interests of the co-owners. The receiver will prepare a report upon which the Court will determine the basis upon which a co-owner can purchase the other co-owners’ interest in the property.
For more information on Procedure in a Partition Lawsuit, a consultation with Orange County real estate attorney Debra Grimaila, Esq. is your next step. Get the answers you seek by calling Toll Free (844) 921-1937 now.
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