How Partition Actions Work in Property Disputes

Protecting Family Property From Partition

Ownership disputes over real estate are common, particularly when property is co-owned by multiple parties. Whether it involves inherited farmland, a jointly owned residential property, or real estate held after a divorce, disagreements among co-owners can quickly escalate. Partition actions provide a legal solution to divide or sell the property when consensus cannot be reached.

This article explores partition actions, their processes, costs, challenges, and resolution strategies, as well as preventative measures to avoid disputes altogether.

What is a Partition Action?

A partition action is a legal proceeding that allows co-owners of the property, known as co-tenants, to resolve disputes about how the property should be used or managed. If co-owners cannot agree, the law provides a mechanism to either divide the property physically or force its sale and distribute the proceeds equitably.

Partition actions are often used in cases where co-owners cannot agree on whether to sell or keep the property, family members inherit property together, and face conflicts over its use, or divorcing spouses cannot decide how to handle jointly owned real estate.

Types of Partition

Partition actions offer three main ways to resolve the situation when co-owners cannot agree on handling the jointly owned property. Each method depends on the property’s nature and the parties’ willingness to cooperate. Here are the three types of partitions:

• Partition by Kind: This involves physically dividing the property into separate parcels, with each co-owner receiving a portion corresponding to their ownership share. This method is most commonly used for large tracts of land, such as farmland, where division is feasible. It is rarely practical for residential or developed properties.
• Partition by Sale: In cases where the property cannot be divided, it is sold, typically through a public auction or court-supervised sale. The proceeds from the sale are divided among co-owners based on their ownership shares. This is the most common approach for properties like houses or buildings that cannot be physically divided.
• Partition by Appraisal: This method allows co-owners to agree to have the property appraised, with one party buying out the other’s shares at the appraised value. It requires mutual consent and is often preferred because it avoids the costs and inefficiencies of a public auction.

The Partition Process

Partition actions involve a clear, step-by-step legal process to resolve disputes over jointly owned property. The process begins when one co-owner files a petition in the court of common pleas in the county where the property is situated. After filing, all co-owners and other parties interested in the property, such as lienholders, are notified of the action.

The court first determines whether partition is appropriate based on the circumstances. If deemed necessary, the court appoints a commissioner to manage the process. The property is then appraised to establish its market value. Commissioners assess whether the property can be physically divided into equitable portions without reducing its value. If division is possible, the court issues a writ of partition, allowing the property to be split into separate lots for each co-owner.

If physical division would significantly harm the property’s value (“manifest injury”), the court orders a sale instead. Before the property goes to auction, co-owners can purchase it at the appraised value. If no co-owner opts to buy, the property is sold at auction, and the proceeds are divided among co-owners based on their ownership shares. Adjustments may be made to account for unequal financial contributions or benefits.

Costs and Challenges of Partition Actions

Partition actions can be financially and emotionally taxing. Depending on the case’s complexity, legal fees can range from $20,000 to $100,000 or more. Additional expenses include court filing fees, appraisal, and real estate agent commissions.

The process is also time-consuming, with most partition cases taking one to two years to resolve due to delays caused by discovery, court schedules, and valuation disputes. Emotionally, partition actions often strain relationships, particularly among family members. Forced sales may also result in properties sold below market value, leading to dissatisfaction among co-owners.

Special Considerations for Inherited Property

Partition actions are often triggered by disputes over inherited property, making them a common issue for families trying to manage shared assets. Without proper planning, these disputes can result in the loss of generational property, such as farmland, through forced sales. Additional complications can arise when unexpected co-owners gain rights due to deaths, divorces, or insufficient estate planning.

Partition laws treat all properties equally, whether a family farm held for generations or a recently acquired city lot. This lack of distinction can have serious consequences, including losing family legacies and financial stability.

Key issues to consider for inherited property include:

1. Generational Property Loss: Heirs who cannot agree on managing or maintaining inherited property may force a sale, even for cherished assets like farmland.
2. Unplanned Ownership Transfers: Poor estate planning or unforeseen events like divorce can introduce unwanted co-owners who may file for partition.
3. Equal Treatment Under Law: Partition laws do not account for property’s sentimental or historical value, applying the same rules to long-held family farms as to recently acquired real estate.
4. Impact on Legacies: Families risk losing valuable assets to court-ordered sales without proactive measures, disrupting traditions and financial stability.

Alternatives to Partition Actions

Before pursuing a partition action, co-owners should explore less costly and contentious alternatives. Negotiation and mediation are often effective in reaching voluntary agreements on selling, leasing, or dividing the property. Mediation, in particular, can help facilitate discussions and prevent litigation.

Buyouts can also be viable, allowing one co-owner to purchase the others’ shares using appraised values to determine fair compensation. Co-tenancy agreements, which specify how disputes will be resolved, are another effective way to prevent the need for partition actions.

Estate planning is critical to reducing disputes over inherited property. Wills and trusts can ensure that property is transferred to specific individuals or managed by a single entity, minimizing the risk of conflict.

Preventative Strategies for Long-Term Solutions

Preventative measures can help co-owners avoid disputes altogether. Creating clear ownership structures, such as transferring property to LLCs or family partnerships, can simplify management and decision-making. Drafting buy-sell agreements, which outline terms for buying or selling ownership shares, can further prevent conflicts.

Succession planning is also essential. Using trusts or well-drafted wills can dictate how property will be managed or sold after an owner’s death, ensuring smooth transitions and reducing the likelihood of partition actions.

Need Legal Help?

Partition actions can resolve property disputes but can be costly and stressful, especially for families managing inherited property. Planning and having the right legal guidance can make all the difference.

At HML Law, we help families in Toledo and beyond navigate property disputes, estate planning, and probate issues. Let us help protect your family’s legacy and find the best solution for your situation.

Schedule a consultation with us today to get started!