Santa Monica Partition Lawyers

The City of Santa Monica was originally founded by Colonal Robert S. Baker, who came to California and purchased the land in 1872. Today, the Santa Monica is a popular resort town with one of the most popular beaches in the world. According to Redfin, In June 2023, Santa Monica home prices were up 10.7% compared to last year, selling for a median price of $1.6M. On average, homes in Santa Monica sell after 28 days on the market compared to 36 days last year. There were 54 homes sold in June this year, down from 69 last year. Santa Monica 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 Santa Monica 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?

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 Santa Monica 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 Santa Monica 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 Santa Monica Partition Attorney will be able to give you good advice on these issues.

What Are Claims for “Contribution”?

Following the sale of the property, the referee will divide the proceeds of the sale among the parties in according to amounts expended for the “common benefit.”

When the sale is confirmed by the court, the court may enter an order about the proceeds of sale. Under the law, the sale proceeds must be applied in a defined order. Specifically, Code of Civil Procedure section 873.820 states that the sale proceeds go towards (a) payment of expenses of the sale, (b) payment of the other costs of partition, (c) payment of any liens on the property in priority, (d) and distribution of the remainder to the parties in proportion to their shares as determined by the court.

Generally, the last part of the priority list includes what is commonly known as an “accounting” or a determination of whether one party has contributed more than their fair share to the property in the form of taxes, improvements, or other benefits for the property. For example, if one party is a 50% owner of the property, but has paid all of the property taxes for the property, then that property owner will have a claim for the remaining 50% above their interest in the property. An experienced partition lawyer will be able to help a co-owner determine their claims to the proceeds and make these arguments to the court in an effective way. An experienced Santa Monica Partition Attorney will be intimately familiar with these matters.

A Partition Case Study: Oswald v. Oswald (2003)

When a trial court orders an interlocutory judgment on the rights and interests of the respective parties, such a judgment is appealable. (CCP § 904.1(a)(9)). However, when such appeals are made, the burden is on the complaining party to prove that the trial court has abused its power. The following paragraphs discuss how the Court of Appeal determines whether a trial court abused its discretion when it awarded a party fair rental value when it found fraud in Oswald v. Oswald (2003) 2003 WL 1547628.

In Oswald, Kim Oswald and her brother, John Jay Oswald, took title as tenants in common to their mother’s house when she died. Kim had not lived in the house for a while, and John continuously lived in the home until its sale in 2002. Kim began having trouble with creditors, so based on his representation that he would quitclaim her 50 percent interest in the house back to her at any time she wanted, Kim quitclaimed her share of the property to her brother.

Soon thereafter, John refused to deed Kim back her share of the property, so she sued him and obtained a summary judgment in her favor. John appealed from that summary judgment (Oswald I) and the Court of Appeal affirmed in part. The court found that Kim had established her fraud claim that justified recission of the quitclaim deed, she had be ousted from the property, she was entitled to a partition as a matter of right, the sale of the house was only feasible through partition, and Kim was entitled to 50 percent of the fair rental value of the property. Following the trial, the trial court entered a judgment and interlocutory order of partition, which was dated December 18, 2001.

The property was eventually sold for $580,000 and the escrow closed in March 2002. Afterwards, Kim filed a motion for an order approving the final distribution of the net sales proceeds of $467,550. The trial court granted the motion and issued its order re final distribution of the proceeds of the sale of real property on December 29, 2002. John appealed.

Although John failed to identify the standard of review in his brief, the Court of Appeal for the Second District clarifies that the standard is abuse of discretion. Additionally, it is the burden of the complaining party to establish an abuse of discretion by the trial court. (Blank v. Kirman (1985) 39 Cal.3d 311, 331).

In Oswald I, the Court of Appeal had found that Kim was entitled to 50 percent of the fair rental value of the property from the day of the ouster (March 5, 1998) to the date the property was sold (March 12, 2002). John contended that the award was excessive because the property was allegedly “essentially uninhabitable” and therefore Kim should not have been awarded “anything over nominal rent.”

When the trial court was determining the amount of the fair rental value, it relied on the declaration and appraisal submitted by Robert Rey Walker, a certified real estate appraiser and agent. Walker was hired by Kim in October 2001 to conduct a four-year lease rate survey for the years 1998, 1999, 2000, and 2001. John did not submit any appraisals but contended that Walker’s appraisal was demonstrably erroneous and based on misrepresentations to the court. John claimed that Walker must have lied to the court when he certified that he had personally inspected the interior and exterior of the property and had noted any adverse conditions because, according to John, the actual condition of the property was uninhabitable and unrentable.

In support of his contention, John relied on his own declaration and the declarations of three real estate agents. Mainly, John focused on the fact that at the time the house was sold, it was in the middle of a remodel which he had begun in April 1998. By the time Kim sued him, John had completed the upstairs, and only the rough framing, plumbing, electrical, and low-voltage work in the rest of the house. The declarations from the real estate agents stated to some capacity that the house had no rental value because of the unfinished and exposed framing.

The Court of Appeal makes it clear that the times that John asserts that the house was uninhabitable are times in which he in fact inhabited the house himself. In Walker’s appraisal of the home, he actually noted that the house was in the process of a major remodel and certified that he had considered all adverse conditions of the property and had made adjustments for those conditions in his analysis.

John also did not like Walker’s description of the property as average; however, he did not give any suggestions on how else the property should have been rated, besides saying that it was uninhabitable. He did not submit any appraisals of his own, nor did he suggest any other “nominal” amount of rent. Therefore, the Court of Appeal concluded that the trial court had discretion to determine the fair rental value, and in light of the of the appraisals submitted by Kim and lack thereof from John, the trial court did not abuse its discretion.

Next, John contended that the trial court erred in awarding a “statutory” prejudgment interest on Kim’s share of the fair rental value of the property because the amount of damages was unliquidated. When she filed her motion for order approving final distribution of sales proceeds, Kim had relied on section 3287 which provided that a person who is entitled to recover damages is entitled to recover interest thereon from that day. However, on appeal, Kim relied on section 3288 which states that in an action for the breach of an obligation not arising from a contract, and in every case of oppression, fraud, or malice, interest may be given, in the discretion of the jury. The trial court did not specify at either the hearing or its final distribution under which it awarded the prejudgment interest.

Although the Court of Appeal determined that prejudgment interest could not be recoverable under section 3287, it found it was awardable under 3288. The section states that when by virtue of the fraud a plaintiff has been deprived of the use of their money, the inclusion of interest is required to make the plaintiff whole. Here, the trial court found that Kim was ousted based on John’s fraud, so because they retained jurisdiction to award prejudgment interest under all applicable statues, the Court of Appeal concluded that the award was not an abuse of discretion.

John also maintained that the trial court should have credited him for the Bank of America loan and the repairs and improvements to the property. The Court of Appeal noted that the trial court did not say why it disallowed a credit to John for the Bank of America loan, but that the only evidence provided by John was his own self-prepared listing of checks. There were no copies of canceled checks or any other verification of payment by Bank of America. Therefore, since the trial court had found that John had committed a fraud against his sister, the court was in its discretion not to give any weight to John’s self-serving list.

Regarding the repairs and improvements, the Court of Appeal again noted that John did not submit any receipts or other evidence to support those expenditures. The trial court also made three findings of fact when it disallowed credit for those expenditures: (1) John had failed to give notice of the improvements and costs to Kim; (2) John’s improvements did not enhance the value of the house; and (3) the court found no bills associated with improvement had been filed with the court. Again, the Court of Appeal found that the trial court did not abuse its discretion in concluding that John had failed to prove his claim, and affirmed the trial court decision.

How the Underwood Law Firm Can Help

A court’s determination of ownership interests in a property depends on the facts and circumstances of each particular case. Factors such as agreements and who pays for certain expenses for the property can ultimately affect the outcome of a partition case. If you are considering partition as an option, or find yourself defending one, then you may benefit from good legal advice on the topic. Please contact Underwood Law Firm, P.C., for an initial consultation.

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