If you and your siblings end up owning a house together, what can you do? You probably don’t want to move in together. And in all likelihood, your brother or sister moved into the house and refuses to move out. What are your rights? The basic remedy is Partition (which means to either divide the property or to force the sale). There are other remedies available, such as getting a court award of back rent and possible attorney fees. Keep reading to learn more …
The concept of partition dates to when most people were farmers and it was more common to inherit large tracts of farm land. In that case, if three kids inherited the farm land, they could get the court to divide the land in equal thirds so they could each get a chunk of their own land. Nowadays, with most people living in the city, it’s more common to inherit a house or other property that is not so easily divided. In such a case, what makes more sense is not to divide the property, but to sell it and divide the proceeds. This is called a Partition by Sale.
Partition by Sale.
In Arizona, a claim of Partition by Sale is grounded on A.R.S. § 12-1211, et seq. “[T]he fundamental objective in a partition action is to divide the property so as to be fair and equitable and confer no unfair advantage on any cotenant.” 59A Am. Jur. 2d Partition § 6. The court starts with the presumption that the parties own equal shares in the Property. See id. § 114. The burden of paying the necessary expenses of jointly owned property is the responsibility of all cotenants (unless one party has been excluded from having an equal right to possession). See id. § 154; see also 20 Am. Jur. 2d Cotenancy & Joint Ownership § 63 (2009).
Each joint owner has a separate interest in jointly held property. See In re Marriage of Berger, 140 Ariz. 156, 165, 680 P.2d 1217, 1226 (App. 1983). When the property cannot be physically divided, partition by sale is more equitable than division in kind of the property.
Another question that can arise is whether a co-owner who had prior use of the property owes rent to the other co-owners. Here’s the rule.
“A tenant in common who does not have actual possession of the property may compel a cotenant in possession to account for rents and profits received from tenants on the premises.” See 59A Am. Jur. 2d Partition § 153. See also 20 Am. Jur. 2d Cotenancy & Joint Ownership §§ 63, (same), 66 (cotenant with exclusive possession does not have right to contribution). See also Cox v. Cox, 138 Idaho 881, 886, 71 P.3d 1028, 1033, (Idaho June 3, 2003), which stated:
Though a settled issue in many states, no Idaho court has decided the issue of whether an ousted co-tenant is entitled to a proportion of the fair rental value of common property. The majority rule is that when one co-tenant excludes another co-tenant from use and possession of common property, the excluding co-tenant is liable for the value of their exclusive use of the property, including rent. Sack v. Tomlin, 110 Nev. 204, 871 P.2d 298, 306 (Nev. 1994); Palmer v. Protrka, 257 Or. 23, 476 P.2d 185, 190 (Or. 1970) (when difficulties in personal relationships between co-tenants make co-occupancy impossible, the excluded co-tenant is entitled to the rental value of their interest in the property); Ireland v. Flanagan, 51 Or. App. 837, 627 P.2d 496, 500 (Or. App. 1981); Maxfield v. Maxfield, 47 Wn. App. 699, 737 P.2d 671, 676 (Wash. Ct. App. 1987) Cummings v. Anderson, 94 Wn.2d 135, 614 P.2d 1283, 1289 (Wash. 1980) (where property is not adaptable to double occupancy, the mere occupation by one co-tenant may operate to exclude the other). This Court adopts this position.
In Northcutt v. McPherson, 81 N.M. 743, 745, 473 P.2d 357, 359 (1970), the court stated that “[t]o constitute ouster there must be some express, open and unequivocal denial of the right to possession of the cotenant . . . .” (Cited by Morga v. Friedlander, 140 Ariz. 206, 208, 680 P.2d 1267, 1269, (Ariz. Ct. App. Apr. 19, 1984).)
The court in Young v. Young, 37 Md.App. 211, 376 A.2d 1151 (1977), stated it slightly different: “Ouster has been defined as a notorious and unequivocal act by which one co-tenant deprives another of the right to the common and equal possession and enjoyment of the property.” (Also cited by Morga v. Friedlander, 140 Ariz. 206, 208, 680 P.2d 1267, 1269, (Ariz. Ct. App. Apr. 19, 1984).)
In plain English.
In other words, if you and your siblings inherit property, and you move into the house and don’t let the siblings have equal use to the property, you can be liable for rent for the time that you had use of the house.
A co-tenant’s right of contribution does not exist when the cotenant had exclusive possession and enjoyment of the property. See 20 Am. Jur. 2d Cotenancy & Joint Ownership § 66; see also In re Marriage of Maxfield, 47 Wn. App. 699, 737 P.2d 671, 676 (Wash. App. 1987). The right to compensation for improvements made on jointly owned property without the consent of the cotenants may be awarded when the improvements: “(1) are made in good faith; (2) are of necessary and substantial nature; (3) materially enhance the value of the property; and (4) are such that circumstances show it would be equitable to do so.” 20 Am. Jur. 2d Cotenancy & Joint Ownership § 69; see also 59A Am. Jur. 2d Partition § 171 (courts may award a cotenant who makes improvements the resulting increase in value of the property, but not the cost of improvements).
In plain English.
If you and your siblings inherit property, and you move into the house and don’t let the siblings have equal use to the property, but you spend a bunch of money fixing the place up, you can’t expect your siblings to chip in to pay for the improvements.
Attorney Fees and Costs.
The common fund doctrine provides that a person who employs “attorneys for the preservation of a common fund may be entitled to have their attorney’s fees paid out of that fund.” LaBombard v. Samaritan Health Sys., 195 Ariz. 543, 548, ¶ 22, 991 P.2d 246, 251 (App. 1998). The doctrine (1) ensures fairness to the successful litigant, whose recovery may be consumed by the expenses of litigation; (2) prevents the unjust enrichment of others who benefit in the fund and should share the burden of recovery; and (3) encourages the attorney to diligently litigate a claim by ensuring payment of his or her fees. Id. at 549, ¶ 22, 991 P.2d at 252. Because the common fund doctrine is a rule of equity, however, it will not be applied if a statute precludes apportionment of attorneys’ fees. Id. (Cited in State ex rel. Raber v. Wang, 230 Ariz. 476, 477-478, 286 P.3d 1085, 1086-1087 (Ariz. Ct. App. Sept. 6, 2012).
In plan English.
If the situation would not get resolved without your taking the initiative to hire a lawyer, at least some of the legal fees can be paid off the top so you aren’t stuck paying them out of your share.
This has been a very brief introduction to the subject of partition. Don’t rely on this article as legal advice. If you have a question, give us a call at 602-443-4888 or contact us here. We have handled numerous Partition by Sale cases, and have a consistently favorable track record.