In California, 50% co-owners hold significant rights and responsibilities under state law. As a rule, co-owners have an equal ownership right in shared property, including the right to use and enjoy the entire property and the right to partition the property, regardless of the percentage of ownership. Co-owners also share the property’s financial obligations, meaning that in some circumstances they have a right to recover rent, mortgage payments, and costs of improvements exceeding their individual ownership obligation. Disagreements between co-owners are unfortunately not uncommon, thus, understanding your rights and responsibilities as a co-owner is crucial to protecting your ownership interest.
Right to Occupy the Entire Property as a 50% Owner
Co-owners are legally entitled to share possession of the entire co-owned property meaning, no co-owner can exclude the other from any part of the property. (Zaslow v. Kroenert (1946) 29 Cal. 2d 541, 548.) Therefore, informal agreements outlining that one co-owner will occupy a specific portion of the property while the other occupies a separate specific portion, may not successfully defend allegations of ouster by one co-owner against another. (Wood v. Henley (1928) 88 Cal.App. 441, 452; Hamilton v. MacDonald (1974) 503 F.2d 1138.) Thus, 50% co-owners have the right to occupy the entire property subject to the other co-owner’s rights unless an ouster has occurred.
What is an Ouster?
An ouster is one co-owner’s wrongful exclusion of another co-owner from the commonly owned property to which they are both entitled possession. (Estate of Hughes (1992) 5 Cal.App. 4th 1607.) Ousters occur in many ways but ultimately manifest in unambiguous conduct arising from the co-owner’s intent to exclude others from the property. (Preciado v. Wilde (2006) 139 Cal.App.4th 321, 322, 325.) When an ouster occurs, excluded co-owners can seek legal recourse, like partition, to resolve the dispute and regain access to the property.
Right to Partition as 50% Owner
Co-owners of real property generally have the right to seek partition of the property. Partition is the legal process designed to either physically divide the property between co-owners or force the property’s sale and divide the sale proceeds between co-owners. The right to partition is an incident of common ownership, meaning co-owners can demand partition without needing to provide a reason and the court must grant the partition if the co-owner’s title is clear. (De Roulet v. Mitchel (1945) 70 Cal.App.2d 120; Thomas v. Witte (1963) 214 Cal.App.2d 322.)
There are three primary methods of partition: (1) physical division of the property; (2) sale of the property and division of the sale proceeds; and (3) partition by appraisal where a supervised appraisal and court order grant one co-owner the interests of all other co-owners. Generally, physical division of the property is the preferred method of partition, however, courts can order the property’s sale, and divide the proceeds if it determines physical division is impracticable or impossible. (Code Civ. Proc., § 872.820.)
Agreements between co-owners can significantly impact co-owner’s rights. Co-owners can modify or waive their absolute right to partition through agreements between co-owners. For instance, an agreement requiring a co-owner to offer their ownership interest to the other co-owner at the original purchase price before seeking partition modifies the co-owners’ absolute right to partition. (Schwartz v. Shapiro (1964) 229 Cal.App.2d 238.) Similarly, co-owners can waive their right to partition by express or implied waiver manifested through express statements in written agreements or actions and agreements creating a reasonable belief of waiver between co-owners. (Code Civ. Proc., § 752.)
Further, a co-owner who ousts, or wrongly excludes another co-owner from the property, risks forfeiting their right to resist a sale of the property in a partition action. (Harlan v. Harlan (1946) 74 Cal.App.2d 555.)
For example, “Shawn” and “Julie” are 50% co-owners of real property in California. After years of co-ownership, Shawn and Julie have a disagreement about the property’s future. Shawn is angry at Julie, refuses to accept her apology, and so, he changes the locks to the property. Later that day, Julie arrives and cannot enter the property. She calls Shawn asking to be let in, but Shawn completely ignores her day after day.
Shawn’s actions constitute an ouster, meaning he has effectively unlawfully excluded Julie, a co-owner, from the property. To regain control of her property interest, Julie files for partition, aiming to force a sale of the property and recover her share of the proceeds. Because no agreements modifying or waiving Julie’s right to partition exist, the court grants Julie’s partition action, ordering a partition by sale because Shawn has proven physical division to be impossible by ousting Julie and therefore cannot oppose the sale either.
Right to Receive a Portion of Property’s Generated Income
Co-owners have the right to recover rent, mortgage payments and the costs of improvements to the property exceeding their fair share in some circumstances.
Right to Recover Rent
According to each co-owner’ right to occupy the entire property, one co-owner cannot recover rent from another co-owner unless they have executed an agreement stipulating otherwise or an ouster occurred. (Brunscher v. Reagh (1958) 164 Cal.App.2d 174, 177.) Thus, each co-owner is generally free to use the property without owing rent to the other.
Whether a co-owner can collect rent, however, depends on whether they are in possession of the property. Co-owners out of possession are not entitled to receive rent or other reimbursements from the co-owners in possession’s exclusive use and possession of the property unless they are third party tenants, have been ousted, or have executed an agreement stating otherwise. (In re Fazzio (1980) 180 B.R. 263.) If a co-owner was ousted, they can recover resulting damages, typically amounting to their share of the value of the land’s use and occupation during the time they were ousted. (Brunscher v. Reagh 164 Cal.App.2d at 177 citing Zaslow v. Kroenert 29 Cal.2d at 548.)
Right to Recover Mortgage Payments, Improvements & Other Costs
In the context of mortgage and improvement costs, courts credit co-owners for payments and improvements made as adjusted for the value of exclusive use and occupation in partition actions. (Wallace v. Daley (1990) 220 Cal.App.3d 1028.) Courts make these allocations during the final accounting; the phase in every partition action where each co-owner’s interest is charged or credited for their actions taken for the common benefit under the principals of equity. (Ibid.) These credits award the costs that a co-owner incurred in excess of their fractional share of necessary repairs or improvements enhancing the property’s value and preserving its title. (Ibid. at p. 1036.) As such, co-owners are entitled to recover the costs of actions taken exceeding their share obligated by co-ownership, as all rights are tied to their shared ownership of property.
Conclusion
Co-owners have the right to access and enjoy the entire jointly owned property, however, other co-owners can violate that right through conduct like ousters. If title to property is a point of contention, partition may be a solution. At Underwood Law, our partition attorneys can help navigate your partition action efficiently and with care. We are here to help.
