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What to Do When Joint Owners Can't Agree

Joint ownership of real property is quite common. It is not unusual for two or more persons to jointly purchase property, perhaps as a shared residence or investment. Sometimes joint ownership results unintentionally: for example, as the result of inheritance or divorce.

Disagreements
Whatever the reason, as time passes, joint owners may find that they do not agree on matters relating to the property. One may want sell the property; the other may want to keep it. One may want to borrow against it; the other may want to keep it free and clear. One may want to improve it; the other may want to leave it as it is. When real property is involved, the sources of disagreement are endless.

The Solution
Fortunately, the law provides a solution: an action for partition.

Originally, this meant that either owner could file an action asking the court to fairly divide the property into the appropriate number of parcels, deeding one to each joint owner. Sometimes, however, this just isn't a practical solution. For example, suppose the property is a single-family residence or a building of some kind. Or suppose it is a small lot that cannot be legally subdivided. Or maybe the division of property is just not feasible for some other reason, or would drastically reduce the total value of the parcels. In each of these cases, physically dividing the property is not a satisfactory solution.

To allow for situations like these, the law now allows the property to be sold, dividing the proceeds rather than the property itself.

The procedure for the sale varies from state to state. In some states the sale is conducted like a foreclosure sale by the sheriff. Other states allow a receiver or commissioner to sell the property in a more conventional manner.

In Arizona, for example, the court appoints three disinterested commissioners who must first physically divide the property in a fair manner if they can. If they determine that the property cannot be fairly and equitably divided, or that the value of the property will be depreciated by physically dividing it into separate parcels, they are to so inform the judge. If the judge agrees, the judge then appoints one commissioner to sell the property in the manner directed by the judge. This gives the judge the discretion to decide whether the property should be auctioned off on the courthouse steps, listed with a broker, or sold in some other manner. Regardless of how it is sold, the proceeds are divided among the co-owners in accordance with their ownership interests.

Conclusion
If you and your co-owner cannot agree on the management or disposition of real property, you can file an action for partition to have it physically divided. If physical division is not feasible or would result in the depreciation of the property, the court may order it sold and the proceeds divided.

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