Who needs a partition?

Sometimes, when two or more parties own real property, one or more parties wants “out.” In this situation, the Ohio Revised Code sets forth a process called partition. Please note, we are not addressing multiple shareholders in a corporation that owns real property or co-members of an LLC that own real property, but two or more parties named as grantees in a deed (or other conveyance instrument) who own real property together. Those shareholder or member disputes are handled in another manner. 

In short, a partition asks a Court to divide real property equitably amongst the co-owners. Or, in situations where the real property cannot be equitably divided, one party can force the judicial sale of the real property to the highest bidder with the net proceeds divided among the co-owners (the parties may argue, and this firm has argued about proper adjustments to the distribution of net proceeds). There is no defense to the action although the process can take time as the Court permits discovery over the course of the partition proceedings. The right to partition of jointly owned property is statutory. That is, if one party brings the action, the property will ultimately be divided or sold.

How to proceed to partition.

Thus, if you no longer wish to own real estate jointly, but the other party or parties do not wish to sell or buy you out, what are your options?

For this situation, let’s assume two things:

• The co-owners are not married as that would be handled in Domestic Relations Court.
• There is no written agreement, what we call a co-tenancy agreement, whereby the parties have established in writing how they will handle disagreements between them as to how the property will be held and disposed. In that case, the agreement will likely control.

So, what options do you have to resolve differences over the ownership and disposition of jointly owned real estate? The answer lies in an action in partition.

What is partition?

A real estate partition is a court case through which a joint owner of real estate can ask the court to split the property.   Partition of the property itself is favored over sale and division of proceeds, however a property may be sold if it can be shown that it cannot be divided without manifest injury. 

A party can ask that the property be sold if it is determined that it cannot be divided. Certainly, this is the usual case for typical residential properties today. In this situation, the Court will appoint a commissioner (or commissioners) under O.R.C. § 5307.09.  When the commissioner(s) are of the opinion that the estate cannot be divided without manifest injury to its value they will provide a valuation of the estate to the Court. One or more of the parties can elect to take the estate at the appraised value and pay the other parties their proportion of the same. Alternatively, if neither party desires to purchase the property or cannot agree on the proportionate purchase of the same, the property will be sold at auction to the highest bidder. Often, cases are resolved and settled among the parties prior to this occurring.

If a property was acquired upon someone’s death, a partition cannot be ordered within one year from the date of the death of the decedent, unless it is proven that either (i) all claims against the estate have been paid, (ii) secured to be paid, or (iii) that the personal property of the deceased is sufficient to pay those claims.

Attorney’s Fees

Under O.R.C. §5307.25, reasonable attorney’s fees can be paid from the proceeds of the sale to Plaintiff’s counsel and may also be paid to “other counsel for services in the case for the common benefit of all the parties” as the Court determines.

Conclusion

A partition action can be used to force the sale of jointly owned property where one or more co-owners refuse to act. Partition is a powerful tool and an experienced attorney is needed to prosecute or defend these cases.