The Partition of Real Property Act (PRPA) is an exciting new development in real estate law only recently passed by the California Legislature. Its effects are far-reaching, and its changes to the procedure for partitions cannot be understated.
At Underwood Law Firm, our attorneys are more than familiar with partitions and the complexities such lawsuits can entail. With the PRPA and its provisions set to go into effect early in 2023, our attorneys are already keeping track of the way it will change to partition law so that we can best assist you in achieving your litigation objectives.
When does the Partition of Real Property Act go into Effect?
An escrow is a tool used in real estate transactions to ensure that the purchase and sale of property occur as intended. At its core, it is merely the “holding” of significant property documents (like the deed) and the down payment for a piece of property. This ensures that the actual purchase of the property is not completed until all the conditions of the sale are actually met, such as the buyer officially obtaining a loan for the transaction.
As the California statutes put it, monies and evidence of title to property are “held by a third person until the happening of a specified event or the performance of the prescribed condition.” (Fin. Code § 17003.)
Escrow has numerous upsides, though it is admittedly an added expense on what it already an expensive transaction. Considering the importance of buying real estate, however, it is a safe option that ensures both buyer and seller leave the transaction satisfied.
Partition litigation can be broadly categorized into two phases. In the first, the parties fight over whether there is a right to partition the subject property. If the court agrees that such a right exists, then the litigation shifts into the second phase, where the parties determine the manner and means by which the property is actually partitioned.
Partition referees play an integral role in this second phase. Their responsibilities are wide and ranging, as they can assist in disbursements, marketing the property, dividing the property, and much more.
At the apex of this second phase is the referee’s report. This is a filing the referee makes with the court after the partition is completed, essentially detailing how the referee partitioned the property. Unsurprisingly, this report can become the focus of additional litigation as parties seek to confirm, deny, or modify the report based on any number of legal grounds.
Partitions by appraisal are a unique way to resolve a partition dispute. In essence, they are buyouts that the parties contractually agree to, allowing one party to remain on the jointly-owned property in exchange for purchasing the other co-owner’s interest at an appraised value.
This seemingly middle-of-the-road option, however, is one of the options available for inherited property under the Uniform Partition of Heirs Property Act. Specifically, the Act permits the non-partitioning party to purchase the other party’s interest at the appraised value, which can allow the property to remain in the family. This effectively grants the non-partitioning property an option to “partition by appraisal.” When a party agrees to buy the property at the appraised value but then cannot ultimately find the money for the purchase, what happens when a partition by appraisal fails?
Sir William Blackstone is a titan in the field of legal jurisprudence. His 1765 work, Commentaries on the Laws of England, is his most famous legal treatise, forming the backbone of common law analysis as modern lawyers understand it today. Without his efforts centuries ago, our conceptions of property, individual rights, and governmental authority would not be the same. His works remain cited even now in judicial decisions at all levels, including the Supreme Court of the United States.
Blackstone’s comments on property law are particularly striking, for they bear the foundational ideas now found in our statutes governing real estate transactions, estate types, property rights, and ownership disputes. And while his analyses on tenancies in common and joint tenancy still bear striking resemblances to our own California statutes, his discussions of partitions show their age.
What is the common law, and why is it important today?
Yes. When co-owners of property decide they want to go their separate ways but cannot come to an agreement on a buyout or reimbursements, they can institute a partition action and have the court system solve the problem for them.
The presence of a life estate, however, substantially complicates this process. Additional evidentiary showings are required, and a partition might not even be available if the life estate owner fights the lawsuit. Thankfully, the Underwood Law Firm is more than familiar with partitions of all types and is here to assist property owners throughout the process.
The Uniform Partition of Heirs Act is a new law that changes the procedure for partitions. A partition action is a court-ordered process where a property owner forces a sale of jointly owned real estate. Essentially, a partition action exists to allow people who own real estate together to take their share of the equity and go their separate ways.
With the price of California’s real estate ever-increasing, the Legislature recognized the importance of keeping property within the family and decided to adopt and enact the Uniform Partition of Heirs Act.
The importance of inherited property cannot be understated. It is the key to advancing inter-generational wealth, allowing families to build off a stable foundation, free from the expensive and stressful process of buying property in California.
When co-owners of property decide they want to go their separate ways but cannot come to an agreement on a buyout or reimbursements, they can institute a partition action and have the court system solve the problem.
While partition actions usually involve homes or commercial properties, they can also involve condominiums. Condos bring with them some additional complexities because condo owners generally own an interest in their individual units and the common areas of the condominium complex.
This dual ownership can pose problems because there are restrictions in place about what can and can’t be partitioned when condominiums are involved. Thankfully, the Underwood Law Firm is more than familiar with partitions of all types of property and is here to assist property owners throughout the process.
A partition action is a court-ordered process where a property owner forces a sale of jointly owned real estate. Essentially, a partition action exists to allow people who own real estate together to take their share of the equity and go their separate ways. But, as simple as this seems, partition actions can often become complex lawsuits. Disputes commonly arise as to what type of partition may be sought and the process for determining ownership interests.
For example, “Julie” bought a house with her boyfriend, “Shawn,” thinking that they would get married one day. Later, after they had bought the house, Julie realized that her boyfriend was not the right person for her. Because Julie wanted to move on in her life, she also wanted to sell the house she bought with her boyfriend. Her boyfriend, however, was mad at Julie for breaking up with him and so refused to agree to sell the house. Because they were not married, Julie could not go to a divorce lawyer, and because they both did not agree to sell, a realtor could not help Julie. Julie felt trapped. Julie then, however, found a partition lawyer and was able to get the house sold so she could move on with her life. A partition lawyer got the job done.
While litigation guarantees are recommended in a lot of contested real estate issues in court, it is not required in a partition action. Read on to find out more about the nuances of litigation guarantees and their relationship with partition actions.
What is a partition action?
A partition action or a partition lawsuit is when one co-owner, or when one person with interest in the property wants to sell the property, but the other co-owners or others with interest in the property do not want to sell their ownership rights.