Code of Civil Procedure (CCP) Section 873.980 – Relation of Agreement to Other Remedies
Code of Civil Procedure section 873.980 revolves around one party backing out of a partition by appraisal agreement. The innocent party may seek specific performance of the agreement under section 873.970, or may instead opt to pursue the right of partition by sale or division.
Code of Civil Procedure section 873.980 states:
The provisions of this chapter are cumulative and if, for default or other cause, interests are not transferred and acquired pursuant to this chapter, the parties may pursue their other rights of partition, subject to Section 873.970.What is an Example?
“Shawn” and “Julie” are siblings who inherit a farm from their grandfather. Eventually, the siblings feud over management of the farm and Shawn sues to partition the property by sale.
During the initial stages of the lawsuit, the parties conduct discovery, take each other’s depositions, and file several competing motions on the pleadings. After each has poured thousands and thousands of dollars into litigation, they realize that it would be best if they worked together for Shawn to simply buy out Julie’s interest in the farm.
They draft up a document relaying to the court that they are in agreement to partition the property through the appraisal process, where Shawn will buy out Julie at an agreed-upon appraisal price, and file it with the court clerk under CCP § 873.920.
After the agreement is filed, Shawn files a motion to approve the partition by appraisal agreement under CCP § 873.930. The court reviews the agreement, finds that it is ultimately fair and equitable, and gives its approval for the property to be partitioned via the appraisal process.
Once this is done, pursuant to CCP § 873.940, the court appoints a partition referee who prepares and files a report on the valuation of the property, while also identifying any outstanding liens.
After the report is prepared, Shawn moves the court to confirm his buyout of Julie. After looking at all the facts, and determining the transaction is fundamentally fair, the court confirms the buyout to allow Shawn and Julie to go their separate ways.
However, only weeks later, Julie decides to back out of this arrangement. She believes that the house is actually worth more than it was appraised for, and wants instead to revert to partition by sale on the open market. In this instance, Shawn has the ability to move the court to enforce the transfer, or to file a separate lawsuit against Julie for specific performance of the partition by appraisal agreement.
In addition, under section 873.980, Shawn can opt for an ordinary partition by sale or division instead of pursuing the buyout via a specific performance action against Julie.
Law Revision Commission Comments (CCP § 873.980)
Section 873.980 is new. If the proceeding aborts or is not carried out, the parties are not prejudiced as to their normal rights of partition except that an innocent party may elect to proceed under the agreement pursuant to Section 873.970.Assembly Committee Comment
As is the case for many of the partition statutes, section 873.980 does not include an “official” Assembly Committee Comment from the California Legislature. But this is the norm. And that’s because the Legislature endorsed an overall adoption of the Law Revision Commission suggestions when it passed the new partition statutes in 1976.
In fact, the introduction to Assembly Bill 1671 (the bill that contained the new partition laws) states that the Revision Commission’s recommendations “reflect the intent of the Assembly Committee… in approving the various provisions of Assembly Bill 1671.” This demonstrates that the intent of the Legislature was essentially in line with that of the Revision Commission.
As to the comment and statute, recall that under section 873.970, the innocent party to a partition by appraisal agreement may specifically enforce that agreement if one of the other parties attempts to back out. But, what if the innocent party falls into the unique situation where they no longer wish to pursue the buyout either?
This is what section 873.980 is designed to address. Per the text of the statute and comment, the innocent party isn’t forced to only try and enforce the buyout agreement. Instead, they “may pursue their other rights of partition.”
Why, though, does the last part of the statute refer to Section 873.970? The answer is that even the party backing out may attempt to re-start litigation for a normal partition, instead of a partition by appraisal. They run the risk, however, of the innocent party opting for specific performance of the agreement.Contact Us
Here at Underwood Law Firm, our knowledgeable attorneys are here to help navigate the complex web of case law and statutes surrounding partitions. If you are thinking of filing a partition, are already in the midst of a partition suit, or just have any questions, please do not hesitate to reach out to our office.