Elk Grove Partition Lawyers
Elk Grove is the second-largest city in Sacramento County, and located south of the state capital of Sacramento.. Elk Grove is well known for its award-winning school district, outstanding restaurants, wineries, and local parks. The city earned the title of the fastest-growing city in the U.S. between 2004 and 2005 and became the first city in California to be incorporated in the 21st century. Like many growing communities, residents of Elk Grove often find themselves in uncomfortable co-ownership situations that they would like to resolve. In those instances, a partition action may be a good option. There are at least four different instances when an Elk Grove Partition Lawyer can be helpful:
- Boyfriend-Girlfriend joint ownership of real estate;
- Sibling-Sibling joint ownership of real estate;
- Parent-Child joint ownership of real estate;
- Investor-Investor joint ownership of real estate;
A partition lawsuit requires real estate to be sold regardless of the requests of the other title owners. The purpose of a partition action is to permanently end all disputes and remove all obstacles to the free enjoyment of land by one person. (McGillivray v. Evans (1864) 27 Cal.92.) These types of actions can be brought for all types of real estate from houses to farms to office buildings to apartment buildings. Similarly, partition actions are available all types of ownership situations from joint tenants to tenants-in-common to partnership property to property jointly owned by former spouses.
Basically, any person who is an owner of real estate can bring a partition action in California. Code of Civil Procedure section 872.710, subdivision (a), states "A partition action may be commenced and maintained by any…owner of…such property." California Civil Code section 872.210 provides a property owner with the "absolute right to partition" absent a valid waiver. Thus, a partition action can be brought by anyone who no longer wants to own jointly owned real estate, other than spousal property.
Generally, a partition action cannot be stopped absent a valid waiver. Virtually universally, the instances in which a court has found a valid waiver have involved some sort of written contract or adverse possession of property. As such, many parties try to stop a partition action through mediation, or a buy-out agreement. In most instances, the parties to a partition action can benefit from creative lawyering by those who are familiar with the different options for resolving real estate disputes.What Are the steps in a Partition Action?
Broadly, a partition action has only relatively simple steps. First, a party files a lawsuit to establish their rights to the property and desire to sell the property. Second, the court determines that the property should be sold, and appoints an appraiser to appraise the property and offer the other owner the opportunity to buy out the interest. Third, if the other fails to do so, then the Court appoints a “partition referee” (who is frequently a licensed Realtor) to sell the property, and they market and sell the property and deposits the proceeds into a trust account. Fourth, the court determines how much each party should receive from the proceeds, which should include addressing offsets and claims for contribution in an “accounting.”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.)Can a Partition Action be Settled Through Mediation or Negotiation?
Generally, anyone considering filing a lawsuit should consider all of their alternatives, including an informal resolution of the problem. This can take the form of a discussion with the other owner or owners about agreeing to sell the property, negotiating with the co-owner to create a formula to divide the proceeds from the sale, or retaining a lawyer to engage in a mediation with the other owners.
Throughout the partition process, and even on the day of trial, any of the owners can make an agreement about the sale of the property. This can happen through a phone call, through negotiations between the parties' lawyers, or through a mediation session with a retired judge or trained mediator. There are many benefits from a mediation session, including confidentiality provisions contained in the law in Evidence Code sections 1115 through 1129.
Specifically, Evidence Code section 1119, subdivision (a), provides "no evidence of anything said or any admission made for the purpose of, in the course of, or pursuant to, a mediation or a mediation consultation is admissible or subject to discovery, and disclosure of the evidence shall not be compelled in any arbitration, administrative adjudication, civil action, or other noncriminal proceeding in which, pursuant to law, testimony can be compelled to be given."A Partition Case Study: Howerton v. Izant
Partitions can be a costly process, and all parties involved must always be mindful of any potential fees that can occur. It is never a pleasant feeling to be caught off-guard by fees that were incurred without any warning, especially after a case has already been settled. One such fee that may be incurred in partition proceedings is attorney’s fees.
When determining how to distribute the costs of partitions, the California code of civil procedure instructs courts to apportion the costs of partition based on each parties’ interests in the property. CA CIV PRO § 874.040 (2022). Additionally, the statute mentions that attorney’s fees and other expenses are included in the costs of partitions if those fees were incurred or paid by a party for the “common benefit”. CA CIV PRO § 874.010 (2022). A court ultimately determines whether a fee was incurred for the common benefit or not on a case-by-case basis.
Howerton v. Izant, Cal.App.Unpub (2006), is an example of what courts consider when ruling on whether a fee was incurred for the common benefit of the parties in a partition action. It is also a cautionary tale for lawyers wanting to represent themselves in partition cases, as it illustrates some unintended consequences of self-representation.
The property at issue in Howerton was a condominium unit in Tahoe City. (Id., at 1.) Bertram Izant owned half of the condominium unit, while the Howertons owned the other half. (Id.) The two parties constantly fought over the years regarding the use of the property, until the Howertons finally sued Izant, seeking a partition. (Id.)
Izant decided to represent himself, a decision that would later come around to haunt him. (Id.) Izant filed a cross-complaint against the Howertons, where he claimed the Howertons breached an implied contract by suing for a partition, and that they had not told him about their plans for additional upgrades to the property before demanding that Izant pay the cost. (Id.)
The Howertons filed a motion for summary judgment for both the original partition complaint and Izant’s cross-complaint. (Id.) The trial court granted summary judgment in the Howertons’ favors on both complaints and appointed a referee to sell the property. (Id.)
After the condominium unit was sold, the Howertons filed a motion to apportion the costs of the partition. (Id.) Izant responded with an opposition to their motion, arguing that the Howertons’ attorney’s fees spent on Izant’s cross-complaint should not be considered in the cost of partition. (Id.) Izant also sought to recover part of the fees from his own legal services he performed for himself after the Howertons entered their summary judgment motion. (Id.) The trial court granted the Howertons’ motion to apportion and held that Izant was not entitled to a portion of his own attorney’s fees since he had acted as his own attorney. (Id.) Izant appealed, and the Court of Appeal upheld some of the trial court’s ruling and remanded the case back to the trial court. (Id.)
The main issue driving Howerton is what sort of expenditure or fee can be called a common benefit to the parties. This is the main consideration when looking at whether attorney’s fees or other expenses will be included in the costs of partition or not, and the statute itself does not seem to give any further guidance. Previous legal precedent regarding this issue held that what determines a common benefit should be analyzed on a case-by-case basis. (Id., at 2.)
In Howerton, Izant filed a cross-complaints with two claims in response to the Howertons’ lawsuit. (Id.) The first claim was Izant’s assertion that the Howertons breached a contract by filing for a partition, since Izant argued that they had an implied understanding not to seek a partition. (Id.) The Court of Appeal held that this breach claim was for the common benefit of the parties because it was deeply tied to Izant’s affirmative defenses in the original complaint. (Id.) The Court of Appeal reasoned that if Izant had succeeded in his cross-complaint, then those same facts used in the cross-complaint would have prevented a partition of the property. (Id.) Additionally, since Izant’s cross-complaint failed, the partition happened which benefited all parties. (Id.) Due to this, the Court of Appeal held that the plaintiffs’ attorney’s fees incurred for fighting Izant’s breach of contract claim was for the common good, and properly deemed as a cost of the partition. (Id.)
Izant’s other cross-complaint claim was a deceit claim. (Id., at 3.) In the deceit claim, Izant argued that the Howertons had not informed him of their intention to upgrade the property’s furnishings. (Id.) Unlike Izant’s breach of contract claim, his deceit claim was not connected to any of his affirmative defenses in the original complaint. (Id.) The Court of Appeal concluded that since Izant’s deceit claim was disconnected from any of the issues in the original partition complaint, the trial court improperly included the plaintiffs’ attorney’s fees for fighting this claim into the partition costs. (Id.) The Court of Appeal remanded the case to the trial court to determine which portion of the plaintiffs’ attorney’s fees fighting Izant’s deceit claim was included in the partition costs. (Id.)
Izant also objected to the inclusion of a dining room table and other objects in partition costs. (Id., at 5.) When the condominium unit was put on sale because of the partition, the Howertons bought a new dining room table and other objects because Izant and the real estate broker thought that the new purchases would improve how the property looked to potential buyers. (Id.) Izant argued that these purchases were not for the common benefit because there was no evidence that the purchases actually helped in selling the property. (Id.) The Court of Appeal was unconvinced and held that the dining room table and other purchases were properly included in the costs of partition, writing:
. . . [T]here is no requirement that every expenditure made for the common benefit be shown to have actually been beneficial. It is enough that the expenditure was “paid for the common benefit.” (Id.)
Another expense Izant wanted to recover and include in the costs of partition was his own attorney’s fees. (Id., at 3) However, one hiccup facing Izant’s argument was that he had represented himself, which the trial court used as the reason to exclude Izant’s attorney’s fees from the costs of partition. (Id.) The Court of Appeal, upholding the trial court’s judgment, wrote that the term of attorney’s fees itself implies an attorney-client relationship, a relationship which Izant did not have because he represented himself. (Id., at 4.) It seems Izant really should have swallowed his pride and hired a partitions lawyer.
Howerton teaches that there are often purchases and expenditures in the partitions process that can be included in the partitions cost as a common benefit to all the parties, even expenses that one would not usually suspect. It may also be confusing for many people, even attorneys, to figure out which expenses are for the common benefit or not. In addition, it is a cautionary tale on the consequences of a lawyer representing himself while not fully understanding this area of law.
The court in Howerton held that an expenditure is not required to actually benefit the parties to meet the common benefit standard, but what matters is that something is paid for the benefit of the parties. This holding is instructive in how an expense can meet the common benefit standard to be included in a partitions cost. For many people however, this standard may be counter-intuitive.How Underwood Law Firm Can Help
As seen in Howerton partitions law is full of intricacies that can catch an unwary party off guard. Courts may have confusing and counter-intuitive legal standards that make it difficult to compute exact costs. It is important for parties to understand the legal standards surrounding partitions law so that they are not caught by surprise at trial or even after trial.
Here at Underwood Law, our knowledgeable attorneys are here to help navigate the complex web of case law and statutes surrounding partitions. If you are trying to plan a partition order, or just have any questions, please do not hesitate to reach out to our office.
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