Whose real estate is it? Partition of property.


Joint property ownership can be a complicated, but necessary situation. Whether owning a home with a spouse, sharing a vacation cottage with family, investing in property with business associates, there are a multitude of situations that could lead to joint ownership. Occasionally multiple owns and different attitudes toward use of the property, especially issues regarding money, can lead to disagreements and disputes among joint owners.

Parties are always free to negotiate an agreement on their own short of involving the courts. Such an agreement can relate to use of the property which can go a long way in easing tensions. However, it may be hard to agree on such use restrictions since there is usually a breakdown in the relationship to begin with. A more realistic situation can involve a buyout or agreement to sell. With a buyout, the parties will agree on a value of the property and a share to pay based upon that value. To most accurately value the property, an appraisal may be necessary.

If you are unable to reach an agreement without court involvement, an action for partition is appropriate. In such a suit, you are asking the court to separate the property, whether it be physically dividing it geographically or sell it and split the proceeds. Partition actions can be helpful when there are ownership disputes, but partition is not without risk. The courts can split the property geographically. That means, they can opt to divide the property and award each owner a smaller parcel, which may not be the ideal solutions for the parties. If you are looking to cash out and be done with the property, this would be counterproductive for your goals.

A court may order the property sold. While it may even be a party’s goal to have the property sold, court ordered sales usually result in a sale at a loss for below fair market value. The one area parties are willing to agree is such disputes is to maximize the price received at sale, as the larger the overall price is, the higher each party’s share will be. So, if the matter is headed toward a court ordered, sale, parties are generally more willing to use a mutually agreeable realtor in order to list the property for the best price possible.

An important issue to consider regarding to sale is splitting of the proceeds. The court does not have to order each party to receive equal shares. Courts consider the equities of the situation such as the initial investment of the parties, contributions during ownership including whether these contributions went toward maintenance and improvement, the use of each of the parties, and other relevant facts.

While working out an agreement with the other owners is preferable, it can be difficult to negotiate without the leverage of pending litigation and an action for partition can be way to bring the other owners to the bargaining table. Talking over your options and rights with an attorney ahead of time can give you a head start in resolving the dispute without depleting its value. The Law Offices of Kathryn M. Wayne-Spindler, P.C. can assist you in such matters. We can explore all legal options with you, formulate a plan based on your goals, and resolve your dispute. Please contact our Milford office at (248) 676-1000 to discuss your specific real estate needs. We help clients throughout Southeastern Michigan, including Genesee, Oakland Livingston, Washtenaw, and Wayne Counties, as well as Mid-Michigan in Clare, Gladwin, Ogemaw, and Roscommon Counties. Our experienced attorneys have counseled such clients in Milford, Hartland, Highland, White Lake, Commerce, Walled Lake, Waterford, West Bloomfield, South Lyon, New Hudson, Brighton, Howell, Ann Arbor, Holly, Fenton, Flint, Linden, Clarkston, Houghton Lake, Higgins Lake, Roscommon and many more local communities. And soon to be opening another office in Dadeville, Alabama.

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