Right to Partition

In some estate plans, parents will leave the farm or ranch to their children equally or to “share and share alike”.  This means each child receives an undivided interest in the real estate.  In other words, if there are three children, each child receives an undivided one-third share of the farm to “share” with the other two children.  The ownership of the farm then, is as tenants in common.

But what if the three owners of the farm cannot, under any circumstances, get along?  Are there any legal methods to dissolve the tenancy in common?  As tenants in common, each tenant possesses a right of Partition.  Partition is the ability to divide property.

A right of partition can either be voluntary or involuntary.  In a voluntary partition, each owner exchanges deeds, with all owners signing each deed, and each deed conveying to owe of the owners a specific parcel of property.

In an involuntary partition, one or more tenants in common petitions the court to divide the property.  The court made divide the property in-kind or by sale.  A partition in kind is when a court will try to physically divide the property between co-owners.  A partition in kind, however, will not occur if “great prejudice” to any of the owners occurs.  Great prejudice occurs when the court compares the amount an owner would receive if the property were divided in kind and then sold versus the amount received if the entire property sold and the proceeds distributed to all owners.  If the amounts are materially different, great prejudice exists.

The Partition article goes into further depth about the partition process and whether the right to partition may be restricted.  As always, if you have any questions, you are welcome to contact us!