Mission Viejo Partition Lawyers

The city of Mission Viejo was originally deemed “undevelopable.” However, in the 1960s, a group of three men purchased the land and started a land development and home building firm to begin the planning of what is now the city of Mission Viejo. According to Redfin, In June 2023, Mission Viejo home prices were down 14.5% compared to last year, selling for a median price of $941K. On average, homes in Mission Viejo sell after 22 days on the market compared to 27 days last year. There were 98 homes sold in June this year, down from 126 last year. As one of the largest master-planned communities in the United States, Mission Viejo residents who own real estate may face disputes with co-owners. Frequently, there are at least four common types of partitions actions for which a Mission Viejo Partition 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

What Is a Partition Action in California?

Partitions are lawsuits that split up the property between multiple co-owners so that each can take their equity out of the home. The prototypical partition are between siblings, former romantic partners, or business partners. Both own parts of the property, but only one wants to end the relationship and take their money out. Partitions enable this to happen, usually ending with a court-ordered sale of the subject property. 

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. The instances in which a court has found a valid waiver have generally 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. The best Mission Viejo Partition Lawyer will be able to share information on this process with you.

What Are the Steps in a Partition Action?

First, a partition action is filed. A partition action can be filed if one co-owner of real property or a piece of real estate wishes to sell the property or piece of real estate in question but the other co-owners or co-tenants do not wish to sell their ownership rights. 

Second, the court may appoint a court referee to oversee the sale of the property in question. The sales procedure includes that all parties agree to the terms and conditions of the sale in writing. If the parties can not agree, as partition actions are usually very contested issues, then the referee that the court appointed may recommend terms and conditions to the court. Then the court will hold a hearing to decide whether or not to accept those terms and conditions. 

Third, in California, the property’s value will be appraised via a third party or another property appraisal with no ties to any of the parties. While this is not required in all states, it is recommended to make sure that all parties are on the same metaphorical page as to the potential sale proceeds of the property in question. 

Fourth, the referee will conduct the sale in the method most agreeable to all of the party’s goals. This can be via a public auction or a private sale. Regardless of the specific method of partition by sale, the court will determine if the sale was “fair.” If it is decided that the property’s sale proceeds had a lack of proper notice, the sale amount is not within reasonable the value of the property, or if the proceeds were unfair- the court would rule that the property will be up for sale again. 

Lastly, the court will order that the proceeds of the sale, minus any court litigated or approved offsets or costs, will be distributed equitably amongst all of the co-owners or people with interest in the property. A top Mission Viejo Partition lawyer will be familiar with the process.

Can You Recover Attorneys’ Fees in a Partition Action?

Code of Civil Procedure, section 874.010 states that “[t]he costs of partition include: (a) [r]easonable attorney’s fees incurred or paid by a party for the common benefit.” 

Interestingly, the costs of partition can also include reasonable expenses necessarily incurred by a party for the common benefit in prosecuting or defending other actions or proceedings for the protection, confirmation, or perfection of title, setting the boundaries, or making a survey of the property. (CCP § 874.020.) 

That attorney’s fees are considered “costs” associated with a partition action is important because Section 874.040 goes on to state the “court shall apportion the costs of partition among the parties in proportion to their interests or make such other apportionment as may be equitable.” A knowledgeable Mission Viejo Partition Attorney will be able to give you good advice on these issues.

What Are Claims for “Contribution”?

Under the law, a property owner can make a claim for contribution for anything that they have expended for the common benefit of all the parties as it relates to their jointly-owned property. Code of Civil Procedure section 874.410 states that “the court may, in all cases, order allowance, accounting, contribution, or other compensatory adjustment among the parties according to the principles of equity.” For example, the credits can include expenditure in excess of the co-tenants fractional share for necessary repairs and improvements that enhance the value of the property. (Wallace v. Daley (1990) 220 Cal.App.3d 1028, 1035-1036.) Similarly, payments for interest, taxes, and insurance made by any co-tenant could be the subject of a reimbursement claim. (Hunterv. Schultz (1966) 240 Cal.App.2d 24.) An experienced Mission Viejo Partition Attorney will be intimately familiar with these matters.

Partition Case Study: Wagner v. Wagner (2010): Evidentiary Support

Arguments in litigation must always be supported with evidence and the law. This is usually the first aspect of an argument that courts consider. Without support from evidence or legal authorities, courts will often just throw out the claim and not even bother analyzing the argument.

Evidentiary support is a vital aspect of litigation that is necessary for all claims in a lawsuit. This is especially important to recognize if a case goes on appeal since parties must rely on evidence already on the record at trial when arguing before the appellate court.

What Led This Case to the Court of Appeal?

Two brothers, Robert and Gary Wagner, bought the property at issue in Wagner v. Wagner (2010) Cal.App.Unpub. WL 1367381 as joint tenants with a fifty percent interest each. (Id., at 1.) The property consisted of a single-family residence with a garage. (Id.) Robert’s wife was added as a joint tenant in a refinance deal that Gary agreed to at the time. (Id.)

Later, Gary built a six-car garage on the property to restore collectable cars. (Id.) The single-family residence was rented out. (Id.) Gary managed the property from 1981 to 1998, and Robert managed the property after that time period. (Id.)

In 2006, the brothers’ relationship deteriorated due to their disagreements over the property. (Id.) Gary thought that he would be reimbursed for adding the garage and receive a share of the property’s appreciation. (Id.) Gary also believed that his compensation would come off the top of the sale proceeds before the brothers would split the proceeds fifty-fifty. (Id.) Robert thought Gary would only receive the reimbursement off the top of the sale proceeds before the fifty-fifty split. (Id.)

The brothers also disagreed over how much Gary spent on the six-car garage. (Id.) Gary claimed it was 30,000 dollars, while Robert contended it was 17,000 dollars. (Id.)

Furthermore, Gary was worried that his fifty percent interest would be diluted with Robert’s wife, Bobbie Jo, being added as a joint tenant. (Id., at 2.) Robert and Bobbi Jo agreed not to claim more than fifty percent ownership, however, so that did not become a concern. (Id.)

In April 2007, Robert sued Gary for partition and declaratory relief. (Id.) Gary cross-complained, arguing that Robert failed to get enough rent and give Gary his fair share of the profits. (Id.) Gary also argued that he and Robert had an agreement where they each had the power to veto a sale so that the property could only be partitioned in kind. (Id.) This was so Gary could continue owning his six-car garage with his car restoration business. (Id.)

The only witnesses at the trial were Robert and Gary. (Id.) Robert and Gary gave the trial court a list of contested issues, which the trial court addressed one by one. (Id.) The trial court found that Robert was entitled to a partition, there was no agreement where a party could veto a sale, and Gary did not suffer any damage from Robert’s conduct, so Gary was not entitled to an accounting. (Id.) The trial court also concluded that Robert did not breach fiduciary duty to Gary, Gary could not cancel the deed that added Bobbie Jo to the title, and Gary was not entitled to relief by quieting title. (Id.)

The trial court found that Gary had spent 22,000 dollars on the six-car garage, and so he would be reimbursed that amount off the top of the sale proceeds before the proceeds were split fifty-fifty. (Id.) The trial court then entered judgment for a partition by sale and appointed a referee to oversee the sale. (Id.) Gary appealed, and the Court of Appeal affirmed the trial court’s judgment. (Id.)

Wagner’s Holding: Have the Evidence

Gary argued that there was substantial evidence of his agreement with Robert where they needed each other’s consent to sell the property. (Id.) Gary further contended that any partition Robert sought had to respect that agreement, and so only a partition in kind was possible. (Id.) Additionally, Gary argued that at the very least, the trial court was obligated to only sell Robert’s interest. (Id.)

Gary’s supposed substantial evidence for the agreement, however, did not actually exist. (Id., at 3.) Gary relied on testimony Robert gave at trial. (Id.) In Robert’s testimony, Robert acknowledged that due to the property being owned in joint tenancy, Gary’s consent would practically speaking be needed for the eventual sale the brothers were considering when they bought the property. (Id.) This testimony did not establish any agreement preventing a partition by sale. (Id.)

In fact, Robert directly testified that no agreement existed. (Id.) When asked specifically about Gary’s claimed agreement, Robert said that there was no agreement. (Id.) Robert also said that they had no conversation where they discussed such an agreement. (Id.) The Court of Appeal concluded that there was no evidence supporting Gary’s claimed agreement. (Id.)

Next, Gary argued that the property could be partitioned in kind. (Id., at 4.) The trial court, however, found partition in kind to be impractical since no investor would want to buy a rental property consisting of a residence and a six-car garage if the investor could not buy the whole thing. (Id.) The Court of Appeal agreed, holding that a partition in kind would be unrealistic for this case. (Id.)

Gary then claimed that the trial court should have used the six-car garage’s fair market value instead of awarding him 22,000 dollars. (Id.) Case law in California states that a joint owner who improves the property at their own expense is entitled to the fair market value of the improvement. (Id.) That does not apply, however, if there is an overriding agreement between the co-owners. (Id.)

At trial, Robert testified that when Gary built the six-car garage Gary asked Robert if he could recover the building costs when the property was sold. (Id., at 5.) Robert agreed to this, which the Court of Appeal found overruled the fair market value rule. (Id.) The Court of Appeal concluded that the trial court’s 22,000 dollars figure was reasonable. (Id.)

Gary also argued that Robert breached his fiduciary duty because Robert only deposited half of the rental income into the property account, so Robert must have been paying the property’s expenses from Gary’s half of the income. (Id.) Gary, however, did not provide adequate evidence for this argument. (Id.) The Court of Appeal held that Gary waived the fiduciary duty argument. (Id.)

Next, Gary argued that the trial court should have ordered an accounting of the profits and losses during the time Robert was managing the property. (Id.) Gary failed to provide any evidence for his claims that there were accounting issues. (Id.) Furthermore, Robert testified that he had hand-delivered accounting reports to Gary every year, which Gary did not dispute. (Id., at 6.) The Court of Appeal found that Gary was not entitled to an accounting. (Id.)

Wagner shows how vital evidentiary support is in litigation proceedings. When a party claims that there is substantial evidence backing their claim, it is necessary to provide that evidence for the court. Simply making statements will get you nowhere in litigation. This is especially important to recognize because the evidence at trial is what the appellate court will examine on appeal. Insufficient evidence at trial is still insufficient on appeal.

How Underwood Law Firm Can Help You

As seen in Wagner, parties must always be ready with evidence to back their claims. Parties must always make claims that are supported by the record. Otherwise, courts will be quick to dismiss any unsubstantiated contentions and even throw out the case altogether.

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 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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