Real Property Law

The Complete Guide to the Partition of Real Property Act (Part 4)

November 2023

By Eli Underwood, Underwood Law Firm

Eli Underwood

This is a continuation of our ongoing series on the Complete Guide to the Partition of Real Property Act. For complete comprehension, read more on it here, here, and here.

As a quick summary, the Partition of Real Property Act is a law specific to California, passed in July 2022. (Stats 2022 Ch. 82 § 3 (AB 2245).) It brought significant changes to how partitions are conducted in the state, if the underlying parties are tenants in common. But even though the act is particular to California, it is actually derived from the Uniform Partition of Heirs Property Act (“UPHPA”).

Because of the similarity between the laws, and in order to deliver the most comprehensive understanding of the Partition of Real Property Act, this guide references law review notes, statutes, and appellate decisions from other states interpreting the UPHPA.

Can you buy out the interest of a co-owner who didn’t appear in the lawsuit?

Surprisingly, the answer is yes, although it’s discretionary. Of the many interesting things the Partition of Real Property Act does, this may be the most head-scratching and potentially misguided.

The text of the code states that, within 45 days of the regular buy-out procedures, any cotenant entitled to participate in the buyout may request the court to authorize a sale of the interests “of cotenants named as defendants and served with the complaint, but that did not appear in the action.” (CCP § 874.317 (g).)

In plain English, this means that the defendants who actually appeared (by filing an answer or responsive pleading) can buy out not only the plaintiff’s interest, but also the interests of the defendants who did not appear. In other words, they can buy out the interests of those parties who are in default.

The NCCUSL justifies this provision by arguing that it “is intended to foster consolidation of interests among active cotenants (which makes any division in kind that may ultimately be needed easier for a court to accomplish), and to provide a fund of money based on a court-approved appraisal of land value… for the benefit of those cotenants who have not been located or who fail to appear and participate in the action.” (UPHPA Final Act with Comments (2010) p. 19.)

That said, one can drum up a myriad of situations where this justification is plainly wrong. For instance, maybe certain co-owners didn’t respond because they’re located across the country, and expending time and money to retain counsel in California is just too burdensome. This doesn’t mean they aren’t “active cotenants,” especially if they’ve been participating in paying their portion of expenses on the subject property.

Another issue is that the law is entirely discretionary. The responding defendants “may request” the ability to purchase the interests in default, but what factors should the court consider in making that determination?

The NCCUSL says the court should “exercise discretion in deciding when to treat non-appearance in an action as an indication of a cotenant’s limited resources, true indifference, or free riding on other cotenants.” (UPHPA Final Act with Comments (2010) p. 20.) How, though, is the court to deduce any of this if the party hasn’t appeared in the action? Will it merely take the word of the other parties, who themselves have the motivation and interest to buy up as many shares in the property as they can?

These are questions presently left unanswered, in California or in any other jurisdiction.

What happens under the Partition of Real Property Act if the plaintiff requests a partition in kind (by physical division)?

Partition in kind is the legal way of saying that instead of ordering a sale, the court actually divides the land up physically into separate plots so that each co-owner receives a new plot based on their ownership percentage.

Notably, the idea of the cotenant buyout is predicated on the plaintiff requesting a partition by sale. The provisions apply only “if any cotenant requested partition by sale…” (CCP § 874.317.) So what happens if the plaintiff never wanted a sale to begin with?

When this is the case, the court skips the buyout procedures and moves directly to determining whether partition in kind is feasible. Notably, the language of the statute says the court “shall” order a partition in kind, “unless the court, after consideration of the factors listed… finds that partition in kind will result in great prejudice to the cotenants as a group.” (CCP § 874.318.)

Before addressing those factors, it’s important to note what happens if the court determines that partition in kind isn’t the best option. When this is the case, the court shall order a partition by sale or dismiss the action outright. How does the court decide between these options? The statute appears to state that dismissal occurs only “if no cotenant requested partition by sale.”

But it’s important to note that the dismissal cannot be premature. For example, in a Georgia case, the plaintiff requested partition in kind. After determining the property’s fair market value via the UPHPA’s appraisal statute, the trial court dismissed the action, citing their equivalent of CCP § 874.318.

The Court of Appeals held this decision to be in error. “Because [plaintiff] requested a partition in kind, the trial court was required to consider whether such a partition was appropriate under [the statute] before dismissing the action.” (Matabane v. Whatley (2022) 364 Ga.App. 56, 59.)

Under the Partition of Real Property Act, how does the court determine whether partition in kind will result in great prejudice (CCP § 874.319)?

Before the court partitions the property in kind, several factors must be considered to determine whether it would result in great prejudice. (CCP § 874.318.) Those factors, listed in CCP § 874.319, are as follows:

  • Whether the property practicably can be divided among the cotenants.
  • Whether partition in kind would apportion the property in such a way that the aggregate fair market value of the parcels resulting from the division would be materially less than the value of the property if it were sold as a whole, taking into account the condition under which a court-ordered sale likely would occur.
  • Evidence of the collective duration of ownership or possession of the property by a cotenant and one or more predecessors in title or predecessors in possession to the cotenant who are or were relatives of the cotenant or each other.
  • A cotenant’s sentimental attachment to the property, including any attachment arising because the property has ancestral or other unique or special value to the cotenant.
  • The lawful use being made of the property by a cotenant and the degree to which the cotenant would be harmed if the cotenant could not continue the same use of the property.
  • The degree to which the cotenants have contributed their pro rata share of the property taxes, insurance, and other expenses associated with maintaining ownership of the property or have contributed to the physical improvement, maintenance, or upkeep of the property.

(7) Any other relevant factor.

While the inclusion of seven factors might lead some to believe that the court must scrupulously identify evidence supporting or not supporting each one, case law from other states suggests otherwise.

In Georgia, the Court of Appeals has stated that “the UPHPA does not require a trial court to provide a detailed written analysis of each factor, or mandate a written analysis regarding whether partition in kind would result in great prejudice to any cotenant.” (Matabane v. Whatley (2022) 364 Ga.App. 56, 60.)

In Iowa, the Court of Appeals stated that “the court must weigh the totality of the ‘relevant factors and circumstances. No single factor may be considered dispositive.” (Bruhn Farms Joint Venture v. Kuehl (2022) 989 N.W.2d 207, 216.)

Finally, the Alabama Supreme Court noted that the equivalent statute “does not require a circuit court to provide a detailed written analysis of each factor…. Rather, [it] requires only that the court consider all the factors and weight the relevant factors accordingly in light of the evidence or circumstances presented.” (Stephens v. Claridy (2021) 364 So.3d 519, 523.)

Considering all these cases, it’s reasonable to assume that the same standards apply in California. Our statute, too, states that the court will weigh “the totality of all relevant factors and circumstances.” (CCP § 874.319.)

Is Partition in Kind Favored under the Partition of Real Property Act?

Yes. As section 874.318 makes clear, if the buyout doesn’t work, or if no plaintiff requested a partition by sale, then the court will seek to partition the property in kind (a physical division) unless it determines that result would be prejudicial under the factors listed in CCP § 874.319.

For the drafters of the UPHPA, this was intentional. As one commentator noted, “the UPHPA maintains the preference for partition in kind.” (Mitchell, Reforming Property Law to Address Devastating Land Loss (2014) 66 Ala. L. Rev. 1, 54.) Moreover, the UPHPA “provides real substance to this preference.” (Id.) This is why the drafters created the multi-factor test found under CCP § 873.319. They wanted to make it as likely as possible for the court to order a partition in kind before it ordered a sale.

Interestingly enough, although California’s Partition of Real Property Act adopted the UPHPA language on this point, there is perhaps no state where this preference is less applicable than California.

The reason for this is simple: the Subdivision Map Act. This law is the primary regulatory control governing the division of property in California. It requires, with certain exceptions, that a subdivider of property (1) design the subdivision in conformity with applicable general and specific plans, (2) construct public purpose improvements such as streets and sewers, and (3) donate land or money for public uses such as parks and schools. (See Gov. Code §§ 66439, 66474-66478.)

The first point above is especially important. If someone wants to approve a subdivision in California, they need to submit extensive documentation to the state and ultimately get approved for a “plan” where the government will allow the subdivision to occur.

Physical partitions are, in essence, subdivisions. They split one parcel of property into many. As such, the remedy of partition cannot be used to get around the requirements of the Subdivision Map Act. The Code of Civil Procedure makes it very clear that “nothing in this title excuses compliance with any applicable laws, regulations, or ordinances governing the division, sale, or transfer of property.” (CCP § 872.040.)

Thus, even though the UPHPA and Partition of Real Property Act may overtly favor partition in kind, that remedy is simply not available for most Californians, especially when they live in any semi or highly-populated region of the state.

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