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underwood-jogani-v-jogani-joint-ownership-300x300Recently, a jury in the Los Angeles Superior Court awarded what may become one of the largest judgments in a real estate case that has ever been issued. Significantly, in addition to a damage award in the billions, the Court also found that the family members were also co-owners in 17,000 apartments across California. As a result, this consequential decision should be better understood for its potential implications for all co-ownership situations. 

Background

This saga started in the late 1970s. The Jogani family, natives of Gujarat, India, built a fortune in the global diamond trade with offices in Europe, Africa, the Middle East, and North America. 

underwood-restraint-on-alienation-300x300Real estate law has many nuances and subtleties. One of the lesser known aspects to real estate law is something known as a “restraint on alienation.” At its most basic, a restraint on alienation limits the sale or transfer of interests in real property. 

Civil Code Section 711 states that “[c]onditions restraining alienation, when repugnant to the interest created, are void.” These conditions may be found in a will that conveys property but provides that the property may not be sold for a certain period of time. (Wharton v. Mollinet (1951) 103 Cal.App.2d 710, 713.) A restriction on the sale of the property will be deemed void and not apply to the recipient’s property interest. Similarly, if property is transferred by a deed, such a restriction will be deemed invalid. The purpose underlying Section 711 is to “clarify[] and protect[] titles for the benefit of the public at large, as well as of the grantees.” (Id.) 

What restraints, if any, are permissible?

underwood-testimony-property-value-partition-cases-300x300The estimated value of a piece of property can be important for resolving several types of legal disputes. It is crucial when a property owner needs to establish damages when the government interferes with the owner’s property and diminishes its value. Spouses may wish to testify regarding the value of their marital property when it is divided during divorce proceedings. A property owner may also want to testify as to their property’s value to contest a bank’s foreclosure on the property.

Testimony regarding a property’s estimated value can also be important during partition proceedings: when one or more co-owners of a property want to sell their property interest a question arises under the Partition of Real Property Act as to the Property’s value. As such, determining who can answer that question becomes of critical importance.

Normally, who can testify as to a property’s value?

underwood-how-to-file-partition-action-california-300x300When co-owners of real estate cannot agree on how to divide or use their property, filing a partition lawsuit becomes a necessary course of action. In California, where real estate is often a significant investment, understanding the process of partitioning property is essential. In this article, we’ll walk you through the steps involved in filing a partition lawsuit in California, empowering you to navigate this legal process effectively.

What should you know before filing a Partition Action?

1. Understand the Concept of Partition.

underwood-guide-to-right-first-refusal-300x300A right of first refusal – sometimes called a “preemptive right” – is a right provided by contract that gives a party priority to purchase a property if the owner decides to sell. This right may be included in an ownership agreement between two co-owners who are cotenants. The person who holds the right is the “grantee,” and the person who gives the right to a fellow co-owner is the “grantor.”

A right of first refusal gives the cotenant priority over other potential buyers when the other cotenant makes a decision to sell their interest in the property. Unlike a valid option provision where a cotenant is obligated to sell the property to the other cotenant subject to the terms of the ownership agreement, under a right of first refusal, a second cotenant’s ability to purchase the first cotenant’s interest depends on the first cotenant’s desire to sell it. The right of first refusal becomes an option when the owner “voluntarily decides to sell the property and receives a bona fide offer to purchase it from a third party.” (Campbell v. Alger (1999) 71 Cal.App.4th 200, 206-207.)  

What types of instruments contain a right of first refusal?

underwood-trust-asset-distributions-300x300A trust is a legal device often used in estate planning. A trust may be established in the trustor’s lifetime, or it may be established in the trustor’s will where it takes effect once the trustor dies and the will is admitted in probate. Generally, assets in a trust are distributed according to the trustor’s intent, which can be specified in the trust instrument or document. 

If a trust instrument is not specific, the Probate Code gives trustees broad discretion to distribute the trust’s assets by: (1) liquidating them and distributing the proceeds between the beneficiaries (in cash distribution); (2) allocating equal shares in interest in the trust’s assets between the beneficiaries (pro rata in kind distribution); or (3) allocating whole assets separately to different beneficiaries (non-pro rata in kind distribution).

What is a trust?

underwood-primer-on-tax-auctions-300x300One of the more interesting ways to buy real estate is through tax auctions. When a party buys a property through a tax auction or foreclosure, they receive a special type of deed known as a “Sheriff’s Deed.” A sheriff’s deed is a legal instrument that is transferred when a property is sold as a result of a foreclosure. The purpose of this article is to provide information on Sheriff’s Deeds so that persons buying real estate at a tax auction can be better informed on the nature of exactly what they are purchasing.

What is the difference between a judicial and a non-judicial foreclosure?

Most foreclosure sales take place outside of judicial proceedings. This is because many mortgage agreements contain a “power of sale” clause. A “power of sale” clause gives the lender the ability to sell the mortgaged property to satisfy the borrower’s debt if the borrower fails to make their contractual payments. This nonjudicial foreclosure process, however, must comply with strict statutory requirements regarding the timeline of a sale and notice procedures once the borrower defaults. (Civil Code § 2924.) 

More unmarried couples are purchasing houses together than ever, but there can be some dangerous legal implications if they decide to go their separate ways, an expert told Newsweek.

As companies institute return-to-office policies, many couples find themselves needing to live in different locations, complicating the home purchase and mortgage they signed on for.

Read More: Unmarried Couples Locked into Homes

underwood-divided-undivided-interest-real-estate-300x300Owning property can be complicated. The purpose of this blog post is to talk about different ways to hold title, and provides information on the meaning of some common terms so the average person can better understand their rights and responsibilities with respect to their property. Different types of property ownership come with different rights. By better understanding these terms, we hope to empower people to able to make the best possible decisions when faced with difficult situations.

Undivided Interests

An undivided co-ownership exists when an entire property belongs to two or more owners. An undivided interest includes the property as a whole and the owners have the right to the entire property. Undivided interests can be characterized as a joint tenancy, where two or more individuals each own a partial and equal right to an entire property. (Civ. Code, § 683.) 

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