What if two people pooled their resources and began investing in real estate. Like many partnerships things progress smoothly for a while and then a dispute arises.
Now they seldom can stand to talk to one another and then only through clenched teeth. A sad story, but one that is not uncommon.
What if they have an undivided interest in a fourplex. They want to end their investing enterprise, but they can't agree on the disposition of the property?
An action for partition may be the only solution. That means one of the investors turns to the court to decided how and when the interest in the property will be divided.
In a partition action the owner or claimant of real property or any interest in the property may compel a partition (division) of the property between him and other owners. It may vary from state to state, but in Arizona the partition complaint is filed in the superior court of the county in which the property is situated.
The court will hold a hearing to "determine the share of interest in the property sought to be divided of each of the owners or claimants, and all questions affecting the title..."
In other words... when those who have an undivided interest in a property can't agree on disposal the court can do it for them.
Here's another example of partition in action:
Your grandmother dies. You are the executor of her estate. Personal property was left 50/50 to me and my brother.
She owned a house and land which was left specifically to her heirs. My cousin has been living in the house and ignoring needed maintenance. The house looks like a junk yard with overgrown landscaping, trash and old cars. There are over ,000 dollars of fines pending from city inspections.
The cousin refuses to leave and is unable to buy out the other heirs. What can you do? Start a court action for partition. The proceeds for from the estate should pay attorney and legal fees.
If you are an investor and come upon such a situation you might try to buy out the interest of each heir before the partition action is completed. They will often sell there interests at a discount for cash now rather than waiting for the court action to completed.
About the Author
Mark Walters is an investor-entrepreneur helping other investors from his Web pages at http://www.Lease-Option-Sub2.com
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The Real Estate Disputes And Partition
Mark Walters
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