Code of Civil Procedure (CCP) Section 874.110 – Payment by Parties

Code of Civil Procedure section 874.110 dictates how the costs of partition are to be paid. Even though it’s the parties who are to pay the costs, however, the payment still comes out of the sales proceeds pursuant to section 873.820.

Code of Civil Procedure section 874.110 states:

1. The costs of partition as apportioned by the court may be ordered paid in whole or in part prior to judgment.
2. Any costs that remain unpaid shall be included and specified in the judgment.

“Shawn” and “Julie” are siblings who inherit property from their parents. Even though they own equal shares, Shawn treats the home as his own, and refuses to allow Julie onto the property. Fed up with being denied the benefits of the home, Julie sues for partition.

As part of this process, Julie procures a title report before the Complaint is filed. Later, when the Court allows the partition by sale to proceed, a partition referee is hired to prepare the home for listing on the open market. The referee also contracts with a contractor to fix up the roof so that the home will get a better sales price.

Eventually, the home is sold. Pursuant to section 874.010, half of Julie’s attorneys fees must be paid out of Shawn’s shares of the proceeds. Julie is also entitled to be reimbursed for half the cost of the title report. Additionally, the fees for the referee and the contractor come out of both parties’ shares of the sales proceeds.

All of the above are considered “costs” of partition under section 874.010. And costs are to be evenly split by the parties to a partition action under section 874.040, unless the court comes to some other equitable arrangement. As such, Julie must be reimbursed from the sales proceeds.

Under section 874.110, Shawn is responsible for paying these costs, and they may be paid in full prior to the final judgment of partition.

Law Revision Commission Comments (CCP § 874.110)

1976 Addition.

Section 874.110 supersedes portions of former Section 796. While subdivision (a) requires payment by the parties, it should be noted that, in the case of sale of the property, the proceeds are to be applied first to discharge the costs of partition before disbursement to the parties. Section 873.820.

Subdivision (b) requires the judgment to list only amounts remaining unpaid rather than all amounts apportioned to the parties under the former provision. See also former Section 798.

The judgment referred to in this section and in Sections 874.130 and 874.140 is the judgment entered at the conclusion of the case in the trial court.

As is the case for most of the partition statutes, section 874.050 does not include an “official” Assembly Committee Comment from the California Legislature. But this is typical. And that’s because the Legislature endorsed an overall adoption of the Law Revision Commission suggestions when it passed the new partition statutes in 1976.

In fact, the introduction to Assembly Bill 1671 (the bill that contained the new partition laws) states that the Revision Commission’s recommendations “reflect the intent of the Assembly Committee… in approving the various provisions of Assembly Bill 1671.” This demonstrates that the intent of the Legislature was essentially in line with that of the Revision Commission.

Turning to the comment, here it is critical for a proper understanding of the way in which section 874.110 functions.

Subdivision (a) appears to imply that the costs of partition may be ordered paid by the parties, especially because the section’s header states “payment by parties.” However, under section 873.820, “payment of the other costs of partition in whole or in part or to secure any cost of partition later allowed,” comes out of the sales proceeds before “distribution of the residue among the parties in proportion to their shares.”

Thus, what subdivision (a) is really stating is that the costs may be ordered paid prior to the “final” judgment that ends the case. The final judgment does not occur until the property has already been sold and the parties’ claims for compensatory adjustment have been dealt with by the court. (see Orien v. Lutz (2017) 16 Cal.App.5th 957, 960, fn. 1 [Code of Civil Procedure section 874.110, subdivision (a), allows a court in a partition action to order payment of attorney fees prior to final judgment].)

As to subdivision (b), the comment again clarifies that the final judgment is only to include remaining unpaid costs, as supposed to all amounts apportioned to the parties.

Here at Underwood Law Firm, our knowledgeable attorneys are here to help navigate the complex web of case law and statutes surrounding partitions. If you are thinking of filing a partition, are already in the midst of a partition suit, or just have any questions, please do not hesitate to reach out to our office.