As an experienced partition referee, Griswold Law has seen all sides of partition cases. We often receive calls from attorneys initiating partition suits, looking to learn the proper procedure -- or even where to begin.
One of the most common questions is: “what procedural route a plaintiff must take to obtain an order for partition?”
Determining Right to Partition
Interestingly, we have seen courts order the partition of property through numerous channels, including some that are at odds with California law.
The court’s first step in any partition case is to determine if a party has a right to partition. This can only be done through trial, summary adjudication or stipulation.
Courts should not order partition upon the motion or ex parte application of a party -- but, like mentioned above, it does sometimes occur.
Interlocutory Judgment
The next step, assuming the court finds the plaintiff entitled to partition, is to follow Code of Ci
vil Procedure § 872.720, which states: “(the court) shall make an interlocutory judgment that determines the interests of the parties in the property and orders the partition of the property and, unless it is to be later determined, the manner of partition.”
The court in Bacon v. Wahrhaftig, 97 Cal.App.2d 599, 603 (1950), stated that “[n]o partition can be had until the interests of all the parties have been ascertained and settled by a trial.” As previously stated, stipulation and summary adjudication are other mechanisms the parties can use to determine the right to partition and the interests of the parties.
The Accounting Stage
After the partition has been ordered and the property sold, the case moves to the accounting stage -- usually conducted by the partition referee.
Taking all the necessary steps to properly obtain an interlocutory judgment and determine the parties’ interest in the property is vital to the accounting analysis.
The partition referee begins the accounting analysis by using the court’s determination of each party’s interest as a starting point. Adjustments may then be made depending on each party’s contribution to the property.
The court in Wallace v. Daley, 220 Cal.App.3d 1028, 1036 (1990) summarized the accounting phase:
“Every partition action includes a final accounting according to the principles of equity for both charges and credits upon each co-tenant’s interest. Credits include expenditures in excess of the co-tenant’s fractional share for necessary repairs, improvements that enhance the value of the property, taxes, payments of principal and interest on mortgages, and other liens, insurance for the common benefit, and protection and preservation of title.”
Determining Party Interest and Joint Tenancy
One reason it is so important for the court to determine each party’s interest at the outset of the case is that joint tenants may not receive the same treatment during the accounting phase that other co-tenants may receive.
The court in Milian v. De Leon, (1986) 181 Cal.App.3d 1185, which addressed the question of how the post-partition accounting process is applied to joint tenants, could not find “a single case in which a true joint tenancy was found and yet an accounting and contribution was ordered because of disproportionate contributions by the parties to the original purchase price.”
The court went on to say that “by definition joint tenancy ownership means equal ownership … and in the absence of an agreement for reimbursement we are unaware of any authority which authorizes reimbursement on account of unequal contributions to the down payment.”
However, it may not be as simple as how the parties hold title on paper. As the Milian court stated: “the disparate treatment of joint tenants is more theoretical than real because in a suit for partition all parties’ interests in the property may be put in issue regardless of the record title, and the court may consider the fact the parties have contributed different amounts to the purchase price in determining whether a true joint tenancy was intended.”
When embarking on a partition case, the early step of determining each party’s interest in the property is vitally important, and no party should simply rely on the language of the deed. This determination plays an important role in the entire case and may ultimately decide how the parties are treated in the accounting phase of the case.
Professionals at Griswold Law, APC have been appointed as a receiver or partition referee over 100 times by courts across California to take control of disputed and/or distressed real property and businesses. Neil Sheaffer is an attorney at Griswold Law, APC. For more information, please contact us at (858) 481-1300 or nsheaffer@griswoldlawca.com.
