Articles Posted in Real Estate Law

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-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-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.) 

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.) 

With rising rates keeping inventory and sales down, 2023 has seen a holding pattern for many real estate owners. Prices have held steady, but there has not been much movement in the market.

That’s likely to change in a major way as we head into 2024.

As the founder and president of Underwood Law Firm, a California-based boutique law firm that specializes in partition actions, I have a unique perspective on the real estate market. A partition action is a legal method that allows a property owner in a bad real estate relationship to use the court system to force the sale. Through my work, I have seen how trends in the larger economy can impact this decision, and how anticipated shifts in 2024 might play out for property owners.

underwood-equity-settlement-offer-300x300California Code of Civil Procedure section 998 incentivizes parties in litigation to settle their disputes before trial. The statute provides that up to ten days before trial, either party may submit a written offer to the other to settle the case under specified terms. (CCP § 998(b).) 

If the plaintiff rejects the defendant’s timely offer and, after trial, receives a judgment not more favorable than the one offered by the defendant, then the plaintiff must “pay the defendant’s costs from the time of the offer.” (CCP § 998(c)(1).) In most civil actions, the court also has the discretion to force the plaintiff to cover a “reasonable sum” of the defendant’s costs of using expert witnesses incurred after the offer was made. 

When a defendant rejects the plaintiff’s timely offer and later receives a judgment at trial that is not more favorable than what the plaintiff offered, the court has the discretion to force the defendant to cover a “reasonable sum” of the plaintiff’s costs of using expert witnesses incurred after the offer was made. (CCP § 998(d).) 

underwood-guide-independent-administration-estate-300x300The Probate process can be intimidating and confusing. In addition to having to deal with the death of a loved one, adding the resolution of legal and real estate issues on top of everything else can feel like a lot. 

Recently, the Legislature changed the law to attempt to make things smoother, and easier on the heirs of estates by passing a law known as the Independent Administration of Estates Act (“IAEA”). The purpose of this guide is to provide an introduction to that law, and share information that will be helpful to those attempting to navigate estate issues. 

What is the Independent Administration of Estates Act

underwood-title-insurance-real-estate-litigation-300x300Before undertaking litigation over real estate in California, title insurance can help to provide clarity as to important ownership questions. Title insurance is not just nice to have, in many instances, the law specifically envisions that the parties will obtain a title report of some type. For example, the Partition Law specifically envisions that the plaintiff will obtain a title report before filing the suit in Code of Civil Procedure section 872.220.

While a title report may be beneficial, a careful partition lawyer will consider going a step further and obtaining some sort of title insurance in order to adequately address any issues that could arise during the lawsuit. Because there are a number of types of insurance that could be obtained, this article will discuss the different options of title insurance available as part of real estate litigation. 

What is Title Insurance? 

underwood-failed-deeds-contemplation-marriage-300x300It is an unfortunate fact that many marriages don’t make it out of the engagement stage. While this can be a difficult time for all involved, the situation can only become more dire when real property is involved.

Commonly, one owner of real property will add their partner to the house’s title shortly before the marriage occurs. Usually, they do this because they are under the impression that the marriage is about to happen. But when the partner calls the marriage off, the property owner is now faced with the problem of title. Under the law, the former partner is now an owner of the property.

In these instances, Civil Code section 1590 allows for the property owner to recover their title, although this will usually require filing a quiet title lawsuit. However, quiet title law can be difficult to understand, and in addition, litigants will need to take care not to blow the applicable statute of limitations. 

underwood-what-is-1542-waiver-300x300Civil Code section 1542 provides, “A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”

Settlements are a key aspect of litigation. As roughly 95% of all civil suits end with settlements, litigants are bound to come across these agreements, because that’s what settlements ultimately are – agreements. And though each settlement will ultimately differ depending on the circumstances, there are some settlement terms in California that are simply ubiquitous. 

These, of course, are agreements related to “release” and “waiver.” These are legal terms that relate to settlement provisions whereby both parties agree to release any claims they may have against each other. Almost every settlement has a section related to a “release.”  

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