Central Valley Partition Lawyers
California’s Central Valley stretches about 450 miles from north to south, covers approximately 18,000 square miles, and contains about 11% of California’s land area. The Central Valley is bounded by the Sierra Nevada to the East, the Coast Ranges to the West, and is best known for its agricultural productivity. The Central Valley encompasses 19 California Counties including, Butte County, Colusa County, Glenn County, Fresno County, Kern County, Kings County, Madera County, Merced County, Placer County, San Joaquin County, Sacramento County, Shasta County, Solano County, Stanislaus County, Sutter County, Tehama County, Tulare County, Yolo County and Yuba County. As the home to many agricultural areas, parties may inherit farms and ranches together. When a co-ownership relationship deteriorates, parties often find that a partition action is the best solution. Frequently, there are at least four common types of partitions actions for which a Central Valley Attorney can provide sound counsel:
- Investor-Investor shared ownership of property;
- Boyfriend-Girlfriend share ownership of property;
- Brother-Sister shared ownership of property; and
- Parent-child shared ownership of property
A partition action occurs when there are two or more title holders to a piece of property, and these title holders are unable to reach an agreement on splitting the subject property. Typically, a litigant brings a partition action to have the court force the sale of or split the subject property. Therefore, when a piece of personal property is concurrently owned by several people, one of the owners may bring a partition action to have the court divide the subject property. In the past, California courts have partitioned not only real estate but also, shares of stock, cash, and businesses.
Generally, an action for partition can be brought forth by a co-owner of real property and a co-owner of personal property. Notably, a court can partition not only real property or real estate but also personal property of any kind. (CCP § 872.230(a).) The best Central Valley Partition Lawyer will be able to share information on this process with you.What Are the Steps in a Partition Action?
Generally, the first step in the partition lawsuit process is not a lawsuit, but an earnest attempt to resolve the matter informally, such as through a partition agreement. Only when it is clear that litigation is the only option, is it clear that a partition lawsuit is appropriate.
When it is clear that a partition lawsuit is necessary, then the process begins with the filing of a complaint in the county where the property is located. There are several technical requirements for the partition complaint, and many important steps that must be taken during the lawsuit to ensure that the process is managed effectively.
In a partition lawsuit, there are generally four different steps. First, the court determines each party's ownership interests. Second, the court will decide on the manner of sale. Third, the court will order the property be sold. Fourth, the proceeds from the sale will be divided between the parties based on their relative contributions to the property.
While some may believe that inherited property cannot be partitioned, this is incorrect. Instead, when the property is owned as the result of an inheritance, there may be an additional step for an appraisal, and a right of first refusal, as provided by the Uniform Partition of Heirs Act. Under this act, where a co-tenant requests partition by sale, the law gives the non-partition owner the option to buy all of the interests of the co-tenants who requested the sale. A top Central Valley Partition lawyer will be familiar with the process.Can You Mediate a Partition Action?
A partition action can always be resolved informally at any time prior to the first day of trial, or entry of judgment. In fact, in numerous instances, just filing the partition itself leads the other party to seek a resolution between them. We always encourage the parties to talk throughout every phase of the process, as that can lead to the best outcomes for everyone.
From our perspective, every piece of litigation is just part of a larger “negotiation.” In any negotiation, the party who has the best leverage is usually able to achieve a more favorable outcome. The lawsuit provides the client with more leverage because they have more options available to them than without the prospect of a resolution from a judge. As such, all that a lawsuit does is provide one party with more leverage in the negotiation about how to resolve the dispute. For this reason, the best way to informally resolve a dispute is to combine discussions with active litigation, so that the matter can be quickly resolved without unnecessary expense. Throughout the process, our attorneys are in touch with our clients about their options and the prospects for informal resolution through mediation or negotiation. A knowledgeable Central Valley Partition Attorney will be able to give you good advice on these issues.What Are Claims for “Contribution”?
Code of Civil Procedure section 874.140 states that the “court may, in all cases, order allowance, accounting, contribution, or other compensatory adjustments among the parties according to the principles of equity.”
The court in Hunter v. Schultz (1966) 240 Cal.App.2d 24 stated that the payments for interest, taxes, and insurance made by any co-tenant could be subject to reimbursement. These claims for reimbursement are commonly known as “offsets” in a partition action.
Further, the court under Milian v. De Leon (1986) 181 Cal.App.3d 1185, announced that a co-tenant who expends money for the preservation of the property, or with the [acceptance] of their co-tenant(s), is entitled to reimbursement for those expenditures before the division of the proceeds among the property owners.
That is, the general rule is that compensatory adjustments are appropriate for improvements that enhance the value of the property for all owners’ benefit. (see Wallace v. Daley (1990) 220 Cal.App.3d 1028, 1035-1036.) An experienced Central Valley Partition Attorney will be intimately familiar with these matters.A Partition Case Study: Charco Ventures v. Sandoval
Actions in partition are equitable in nature. As such, the costs of partition include reasonable attorney’s fees incurred or paid by a party for the common benefit. (CCP § 874.010.) The main goal of this partition statute “is to divide the cost of the legal services among the parties benefited by the result of the proceeding.” (Stewart v. Abernathy (1944) 62 Cal.App.2d 429, 433.) Depending on the facts and circumstances of a partition suit, the court will decide whether the attorney fees were incurred for the common benefit. The following paragraphs discuss how the facts and circumstances in Charco Ventures v. Sandoval (2010) 2010 WL 227647, affected the court’s apportionment of attorney fees.
In Charco Ventures, Charco Ventures (“Charco”) brought two suits against Efren Sandoval (“Sandoval”) to sell property which both parties held title to. The trial court consolidated the two actions filed by Charco, along with the two cross-complaints filed by Sandoval. Charco then filed a consolidated first amended complaint against Sandoval for fraud, breach of fiduciary duty, dissolution of partnership, partition of the property, accounting, and declaratory relief. Sandoval filed cross-complaints against Charco and Stanton Charney for recission of Charco’s one-half interest in the property and damages for breach of a partnership contract, breach of fiduciary duty, fraud, and waste. The trial court entered judgment awarding Charco damages for $190,500 for Sandoval’s breach of fiduciary duty, ordering the partition of the property, and denying any recovery on Sandoval’s cross-complaints.
Before litigation commenced, Charney owned real estate investments, mostly through a limited partnership, including one called Charco Ventures. Sandoval was a real estate broker who represented Charney and Charco in various real estate transactions. The Parties’ relationship eventually broke down, which led to this litigation.
Originally, Charco and Charney sought costs and a motion for attorney fees totaling $415,458.75 for the services of their current and prior counsel. Sandoval opposed the motion and claimed that (1) only $1,462.50 of Charco’s prior counsel’s fees were incurred for the common benefit of the parties, (2) the majority of Charco’s current counsel’s fees were not incurred as part of the partition action or for the common benefit of the parties, (3) half of the fees should be denied as services provided to Charney because he was not a party to the partition action, and (4) any fees the court determined were incurred for the common benefit of the parties should be apportioned 50/50, based on the ownership percentage of the Parties in the property.
The trial court entered judgment for Charco’s attorney fees of $95,227.61, and other costs of $40, totaling $92,267.61. The trial court found that (1) the partition action was brought for the common benefit of Charco and Sandoval, and (2) Sandoval’s unsuccessful defenses and claims complicated the partition action. The trial court recognized that Charco and Charney also made other claims in addition to the partition claim, and deducted the attorney’s fees they requested as they were not related to the partition action or for the parties’ common benefit. The trial court also accounted for a portion of Charco’s prior attorney fees because there was insufficient evidence prior attorney fees were incurred for the common benefit. In the end, the trial court ordered Sandoval to pay Charco’s costs of partition totaling $95,267.61, which apportioned 60% of the attorney fees to Sandoval and 40% to Charco “as a matter of equity” based on the evidence showing that Sandoval “consistently to the time of trial opposed the sale” of the property. Sandoval appealed, asserting that the trial court erred in its finding of common benefit.
Sandoval argued that none of Charco’s current counsel’s fees should have been awarded because Charco unsuccessfully challenged Sandoval’s interest in the property and that the fees incurred in resolving the disputed claims of a property interest to be partitioned are not incurred for the common benefit. However, the California Third District Court of Appeal disagreed and found that it was “well settled law that litigation of disputed claims of interest to the property in a partition action does not preclude a finding of common benefit warranting an award of attorney fees.” (CCP § 874.010; Cappucio v. Caire (1935) 215 Cal. 518, 528-529.)
Further, the Court of Appeal found that Sandoval did not meet his burden to show that the portion of the fees awarded by the trial court included amounts not incurred for the common benefit. Here, the Court of Appeal found that the trial court reviewed billing records in support of Charco’s motion for attorney fees and kept in mind the issues that were litigated and resolved at trial. The trial court had also determined that some services were not for the common benefit of the parties and only awarded fees that it actually found attributable to the common benefit.
Additionally, Sandoval also contended that the trial court should not have awarded fees incurred by Charco and Charney in trying to reduce Sandoval’s interest in the property, including Charco’s counsel’s communications with an expert witness. However, the Court of Appeal reasoned that the trial judge was in the best position to determine whether the fees related to the partition or if they were for the common benefit. Further, the Court of Appeal held that Sandoval had not shown that the trial court’s determination was incorrect and noted that “fees approved by the trail court are presumed to be reasonable, and the objectors must show error in the award.” (Consumer Privacy Cases (2009) 175 Cal.App.4th 545, 556.)
Lastly, Sandoval argued that the trial court treated him unfairly in order to punish him because the trial court did not apportion the awarded fees in accordance with the Parties’ 50/50 interests in the property, but instead, 60/40. However, California Code of Civil Procedure section 874.040 allows the court to “apportion the costs of partition among the parties in proportion to their interests or make such other apportionment as may be equitable.” Here, the Court of Appeal noted Sandoval’s persistent and continuous efforts to derail and interfere with the partition action by asserting meritless claims. Thus, the Court of Appeal agreed with the trial court’s apportionment and affirmed the trial court’s judgment.How the Underwood Law Firm Can Help
How a court decides to apportion the costs of partition, including attorney fees, depends on what is equitable. What is equitable depends on various factors including each party’s ownership interests in a property, and a party’s actions during the litigation stage.
As there are many different facts and circumstances that can affect the apportionment of costs and awards, if you are considering partition as an option, you may benefit from good legal advice on the topic. If you find yourself contemplating a partition action, or faced with defending one, then please contact Underwood Law Firm, P.C., for an initial consultation.
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