Sonoma Partition Lawyers
The city of Sonoma is in the North Bay region of the Bay Area. It is at the center of California's renowned Wine Country. The town is well known for its excellent wines, vineyards, and beautiful views of the Mayacamas Mountains found to the city's east and the Sonoma Mountains to the west, making it a popular tourist destination. As a popular community within California's Wine Country, many residents of Sonoma may find themselves inheriting the family vineyard along with their siblings. Unfortunately, co-ownership of property is not easy. Often, these individuals find themselves in situations they much rather escape but may be unable to find a way out. In such cases, a Sonoma Partition Lawyer can be beneficial.There are several instances when an individual may benefit from consulting with a Sonoma Partition Lawyer:
- Brother-Sister joint ownership of property;
- Non-Married Partners joint ownership of property;
- Parent-Child co-ownership of property; and
- Investor-Investor co-ownership of property
A partition action is an action brought by a co-owner of a piece of real property against another co-owner, seeking to divide the property according to the respective interests of the co-owners. In order to establish a right to a partition, a party must show that they have some ownership interest in the subject property. Under Code of Civil Procedure section 872.210, any owner of an estate of inheritance, an estate for life, or an estate for years in real property where such property or estate is owned by several persons concurrently or in successive estates may bring a partition action. (CCP § 872.210.) Therefore, a co-tenant has an absolute right to partition. (Formosa Corp. v. Rogers (1951), 108 Cal.App.2d 397.) At Underwood Law Firm, our attorneys are more than familiar with partition actions and the step-by-step process of pursuing a partition.
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"?
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. (Hunter v. Schultz (1966) 240 Cal.App.2d 24.)Can a Partition Action be Settled Through Mediation or Negotiation?
A partition action can always be resolved informally at any time prior to the first day of trial. In fact, in numerous instances, just filing the partition itself leads the other party to seek a resolution between them. We always encourage the parties to talk throughout every phase of the process, as that can lead to the best outcomes for everyone.
From our perspective, every piece of litigation is just part of a larger "negotiation." In any negotiation, the party who has the best leverage is usually able to achieve a more favorable outcome. The lawsuit provides the client with more leverage because they have more options available to them than without the prospect of a resolution from a judge. As such, all that a lawsuit does is provide one party with more leverage in the negotiation about how to resolve the dispute. For this reason, the best way to informally resolve a dispute is to combine discussions with active litigation, so that the matter can be quickly resolved without unnecessary expense. Throughout the process, our attorneys are in touch with our clients about their options and the prospects for informal resolution through mediation or negotiation. An experienced Los Angeles Partition Lawyer will be familiar with this process.A Partition Case Study: Wegner v. Messena
The two most common types of partition are partition in kind and partition by sale. Partition in kind is a physical division of the property, while partition by sale is a forced sale of the property. Courts prefer partitions in kind since they do not want to force an unwilling owner to sell their property. However, courts will order a partition by sale when the circumstances call for it.
The most important issue that courts examine while determining a partition in kind or a partition by sale is equity. If a party can prove that it is more equitable to sell the property than to divide it, courts have full discretion to order a partition by sale. It is important for all parties to understand what courts mean by equity, and what sort of equity needs to be proven.
Wagner v. Messana, Cal.App.Unpub (2022) WL 731052, is a case indicative of what courts look for when examining equity. In addition, it is important to remember that a partition by sale can be ordered without all of the parties' consent. If a court finds that the circumstances call for a partition by sale, the court will force a sale regardless of what the parties want.
The property in Wagner is a lot on Santa Rosa Avenue, consisting of two parcels. (Id., at 1.) The front parcel was zoned for limited industrial use, while the rear parcel was zoned for rural residential use. (Id.) There was a boat-and-storage business called TJ RV & Boat Storage on the property. (Id.) In 1999, Theresa Messana Louvar created the Theresa Messana Louvar Trust, which included the property and the business, with her three children as beneficiaries. (Id.) The three children were Charles Joseph Messana (nicknamed Jody), Russell Messana, and Christine Merkel (nicknamed Chris). (Id.)
In May 2000, Theresa established a separate trust for Jody. (Id.) Jody would be paid monthly by the trustee, and upon Jody's death, the separate trust would terminate. (Id.) Any remaining property would be given to Jody's descendants. (Id.) If Jody had no descendants, the property would be distributed among his siblings. (Id.) Russell was appointed as trustee of Jody's separate trust. (Id.)
In May 2012, Theresa passed away. (Id.) Later, Russell was removed as trustee of Jody's separate trust, and a private professional fiduciary named Wagner became the trustee. (Id.) In November 2016, TJ RV & Boat Storage was conveyed out of Theresa's trust. (Id.) The property was divided into thirds and granted to three trusts as tenants in common. (Id.) One trust was held by Russell and his wife, another trust was Jody's separate trust, and the last was a living trust held by Chris. (Id.) Each trust was given a one-third undivided ownership interest of the property. (Id.)
Jody's separate trust had to pay legal expenses because of the order to transfer the property into thirds. (Id.) Wagner sued for partition to meet the expense requirements for Jody's separate trust, since funds were being used for legal fees. (Id., at 2.) Russell, his wife, and Chris were all opposed to Wagner's partition. (Id.)
The trial court held that, since Wagner held a one-third undivided interest in the property as a trustee of Jody's separate trust, Wagner had a right to a partition. (Id.) The trial court appointed a referee to determine how to partition the property and entered a temporary judgment, also called an interlocutory judgment, for a partition. (Id.) Russell, his wife, and Chris could have appealed this judgment, but they failed to do so. (Id.)
The referee assessed that a three-way partition in kind could reduce the value of certain portions of the property. (Id.) The referee also reported that a partition by sale would prevent the parties from earning income from their business. (Id.) Though the referee recommended for Wagner's share to be bought out, this could not be done because not all of the parties gave consent to this recommendation. (Id., at 3.)
The trial resumed in August 2019, with Wagner arguing that the property should be partitioned by sale. (Id.) The trial court ordered a partition by sale, concluding that this was the most equitable solution. (Id.) Russell, his wife, and Chris appealed the trial court's order, and the Court of Appeal affirmed the trial court's judgment. (Id.)
The appellants' arguments failed to persuade the court for a simple reason: the appellants did not fully understand what standards the court used in deciding for a partition by sale. Due to this fundamental misunderstanding, the appellants could not form a cohesive argument, and even their own words were used against them.
Even before getting to the issue of equity, the appellants failed to appeal the trial court's interlocutory judgment for a partition. (Id.) This meant that any arguments the appellants had about the trial court erring by issuing the interlocutory judgment were waived. (Id.) Since the interlocutory judgment became final, the Court of Appeal dismissed all of the appellant's arguments appealing the interlocutory judgment, which meant the appellants could not argue against the partition itself. (Id., at 4.)
The appellants then argued that the trial court abused its discretion in ordering a partition by sale instead of in kind. (Id.) However, the Court of Appeal did not find any of the appellants' arguments persuasive. (Id.)
The appellants first claimed that Wagner did not prove that it was impossible for the property to be physically divided. (Id., at 5.) The Court of Appeal pointed out that the standard was that the land could not be divided equally, not that dividing the land was impossible (Id.) At trial, Wagner showed evidence that dividing the property into parcels of equal value would be impractical, and any such division would devalue each party's ownership interest in the property. (Id.) The Court of Appeal wrote:
The trial court in its statement of decision specifically found that partition by sale was "more equitable" than partition in kind . . . The court took into consideration the testimony that any division of the property could cause the property to lose its industrial zoning given the need for more housing, the fact it appeared unlikely the property could be divided in such a way as to preserve the business that appeared to be the "highest and best use of the property," and uncertainty over where access roads would be placed to reach the back portion of the property were it to be divided. (Id.)
Even Russell himself testified at trial that he didn't want a division of the property because "the sum of the parts is greater than the individual pieces the way it is," essentially admitting that a partition by sale would be more equitable for this property. (Id.) The Court of Appeal held that partition by sale was more equitable than partition in kind for this case and affirmed the trial court's judgment. (Id.)
Wagner illustrates how important it is to understand the legal standard of the issue that one is arguing. A simple misstep or misstatement of the legal standard can cause a court to completely dismiss all of a party's arguments. The party will have wasted much time and money attempting arguments that a court would not give the time of day.
For a partition by sale, Wagner teaches that a party merely has to meet the "more equitable" standard to force a partition by sale. This is important because it is a lower bar than one might expect, as one only must prove that splitting the property into equally valuable pieces is infeasible. Courts also have wide discretion in deciding whether something is more equitable or not, so it is vital to fully understand the types of evidence courts analyze when making that consideration.How the Underwood Law Firm Can Help
As seen in Wagner, partition law is full of intricacies that can catch an unwary party off guard. Courts may use legal standards that are contrary to common belief. It is important for parties to understand the legal standards surrounding their issues so that they can articulate cohesive legal arguments that will hold water in court.
Here at the 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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