Code of Civil Procedure (CCP) Section 874.050 – Court Apportionment of Costs

Code of Civil Procedure section 874.050 dictates how the court is to apportion the “costs” of partition identified in section 874.010, when the partition involves successive estates. This statute is rarely used because partition of successive estates is not a matter of right, like it is for concurrent estates.

Code of Civil Procedure section 874.050 states:

1. The court may order that the share of the costs apportioned to a future interest be paid by other parties to the action or by the persons who are then the presumptive owners of the future interest.
2. Where the court orders payment pursuant to this section, such payment is subject to a right of reimbursement, with interest at the legal rate, secured by a charge upon the future interest.

“Shawn” and “Julie” are siblings who own a piece of property equally. In order to provide a space to their dad, they decide to grant him a life estate in the property. Even though they own equal shares, the siblings begin feuding over how much of the house they truly own. Fed up with the arguing, Julie files for partition.

As part of this process, Julie procures a title report before the Complaint is filed. Later, when the Court allows the partition by sale to proceed, a partition referee is hired to prepare the home for listing on the open market. The referee also contracts with a contractor to fix up the roof so that the home will get a better sales price.

Eventually, the home is sold. Pursuant to section 874.010, half of Julie’s attorneys fees must be paid out of Shawn’s shares of the proceeds. Julie is also entitled to be reimbursed for half the cost of the title report. Additionally, the fees for the referee and the contractor come out of both parties’ shares of the sales proceeds.

All of the above are considered “costs” of partition under section 874.010. And costs are to be evenly split by the parties to a partition action under section 874.040, unless the court comes to some other equitable arrangement. As such, Julie must be reimbursed from the sales proceeds.

However, the Court decides to put the reimbursement of these proceeds onto Shawn. Even though their dad holds a present possessory interest, under section 874.050, the court can order the costs to be split by the future interest holders instead of the present interest holders.

Law Revision Commission Comments (CCP § 874.050)

1976 Addition.

Section 874.050 is new. Where a share of the costs is apportioned to a future interest, the amount is discounted based on the present value of the future interest.

As is the case for many of the partition statutes, section 874.050 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, section 874.050 has no appellate case law directly interpreting its provisions. This of little surprise, as partitions of successive estates is a rarity. In addition, partition of successive estates is not a right, like it is for concurrent interest holders.

Instead, partition of successive estates may occur only “if it is in the best interest of all the parties.” (CCP § 872.710.)

Nonetheless, for those rare cases in which a partition of successive estates actually occurs, the statute points out that the court can apportion the costs borne by future interest holders to other parties. The comment adds that if the cost is instead apportioned to the future interest holders, the amount must be discounted based on the present value of the future interest.

This present value would have been determined under section 873.840. Notably, the standard there is that the present interest holder must be paid a “just and reasonable sum” for the value of their present possessory estate.

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.