Is a litigation guarantee required in a Partition Action?

Underwood-Blog-Images-2-1-300x300While litigation guarantees are recommended in a lot of contested real estate issues in court, it is not required in a partition action. Read on to find out more about the nuances of litigation guarantees and their relationship with partition actions. 

What is a partition action? 

A partition action or a partition lawsuit is when one co-owner, or when one person with interest in the property wants to sell the property, but the other co-owners or others with interest in the property do not want to sell their ownership rights. 

A partition lawsuit is brought by one co-owner to force the sale of the property. This is one way for a co-owner to sell their interests in the property in question and terminate their ownership status. 

There are several situations where there could be potentially several parties with interest in one property. These could be called “joint tenancies” or “tenancies in common.” 

Partitions can be either voluntary or compulsory by judicial means, such as ordered by a judge. Judges can order to physically divide or sell the property, depending on the specific property and its characteristics in question. 

What is a litigation guarantee? 

A litigation guarantee offers a plaintiff and the plaintiff’s legal team legal protection that they have named all proper parties as defendants in their case. 

Sometimes, litigation guarantees are considered to be legal insurance policies because it is issued in favor of the attorney and the client in action affecting land. 

In a partition action, a litigation guarantee ensures that the plaintiff (or the co-owner of the property who brought the partition action) has named all the other proper co-owners to a portion action. Then, if there is a litigation guarantee, whatever the court rules for the partition- whether it is partition by sale, partition in kind, partition by division, or partition by appraisal is the final court judgment. 

A litigation guarantee’s purpose is to ensure that any judgment received (IE- the sale of a partitioned property) is binding. Binding is a fancy legal term that means the judgment or decision can not be reversed. 

Litigation guarantees also are admissible to court as evidence via an avenue of showing the interests of the named parties as a title for a company’s business or other organization’s record. 

Who does a litigation guarantee not cover? 

Litigation guarantees do not affect any parties that are not named in the lawsuit. This means that if serving a litigation guarantee in a partition action, then you will want to make sure that you include anyone and everyone who has an interest in the property in question. 

If a party is not specified in the litigation guarantee, they could file suit against the judgment, or the judgment could be subject to reversal, depending on your partition actions and specific circumstances. 

Litigation guarantees do not cover any property or co-property owner’s spouses or familial members, even if they are asserted in a will or trust agreement unless specifically referred to. 

Is there a requirement for a litigation guarantee in a partition action? 

No, there is no legal requirement to obtain a litigation guarantee before a judgment is rendered in a partition action. 

However, there is no preclusion of litigation guarantees in partition actions either. So, whether you decide to move forward with a litigation guarantee is solely up to you as a plaintiff and your attorney, if applicable. 

What avenues can you take as an alternative to a litigation guarantee? 

Instead of putting forth a litigation guarantee in a partition action, you can take care to ensure that you have named all of the parties who have an interest in the property you are seeking to partition. 

Avenues that you can take before a partition action to ensure you have named all the relevant parties can include:

  • Looking at the property deed to see if any parties are listed;
  • Review a will to see if any additional heirs or parties are listed;
  • Determination if a deceased family member may have passed their property down to their heirs without a will;
  • Requesting history of the deeds from a country register;
  • And asking the other parties to the partition action.

What is contained in a litigation guarantee? 

Litigation guarantees are generally divided into five sections or parts, but they may be subject to additional sections or parts depending on your state’s rules and regulations surrounding real property litigation guarantees. 

First, the first few pages will include legal assurances or legal declarations of what the guarantee is assuring. 

Second, the terms and conditions of all the parties named will be explained in detail. It will also include what is not included in this agreement and the reasons why or why not something is a condition of the agreement, if applicable. 

Third, something called a “schedule” will provide background information regarding liability aspects, notice requirements, and state-by-state specific regulations as to real property law

Fourth, there will be a section on what background information is not included or applicable under the litigation guarantee. 

Finally, it will include all relevant addresses and notice requirements for attesting to the litigation guarantee as to the plaintiff’s party. 

How can the attorneys at the Underwood Law Firm, P.C. help? 

Whether you are faced with a partition action you did not wish for or you wish to assert a partition action against your co-owners, it is a good idea to seek counsel from a knowledgeable and experienced attorney, like the ones at the Underwood Law Firm, P.C.. 

There are a lot of different legal deadlines and submission guidelines for partition actions in real estate litigation actions, and it may behoove you to consult with an attorney to see for yourself how they could assist you in maintaining compliance with all of the guidelines and laws in a partition action.

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