Detailed Answer
When co-owners cannot or do not want to divide real property physically, California law allows the co-owner who wants cash to pursue a legal remedy called a partition action. Under the Partition of Real Property provisions (Code of Civil Procedure § 872.010 et seq.), a court can either divide property into separate physical parcels (partition in kind) or order the property sold and the proceeds divided among owners (partition by sale). See the California statute collection for the partition provisions: Code Civ. Proc. § 872.010.
Key options to obtain money instead of a physical share:
- Negotiate a buyout: The simplest route is an agreement where one co-owner pays the others for their ownership share. The parties can use an independent appraisal to set a fair price and execute a written buyout agreement transferring title and paying cash at closing.
- File a partition action and ask the court for sale: If co-owners cannot agree, a co-owner can file a partition complaint in Superior Court asking the court to partition the property. If the court finds that division in kind is impractical or would unfairly diminish value, it may order a sale and distribute net sale proceeds according to each owner’s ownership interest.
- Request a judicial buyout (court-ordered purchase): In some cases parties agree (or the court approves a stipulation) that one owner will purchase the interests of the others at a court-determined value, avoiding a public sale.
- Settlement before judgment: The parties can settle at any time during a partition action. Many cases resolve by sale and agreed distribution, or by a negotiated buyout allocating credits for mortgage payments, improvements, taxes, rents, and liens.
How the court divides money
When the court orders sale, it will:
- Sell the property at public auction or private sale under court supervision.
- Pay off mortgage and other encumbrances from sale proceeds.
- Deduct sale costs, legal fees and appointed referee or trustee fees.
- Allocate the remaining proceeds among owners according to their recorded ownership shares (title or evidence of contribution), subject to any offsets the court orders for payments one owner made for mortgage, taxes, insurance, or improvements that benefited the property.
The court’s accounting can adjust shares to reflect payments or benefits (for example, if one co-owner paid the mortgage for years or made significant improvements). Because the law recognizes these equitable adjustments, you should gather records of payments, repairs, rent received, and other financial contributions before filing or negotiating.
Typical timeline and costs
A partition action can take several months to over a year depending on complexity, title issues, and whether the parties contest valuation and accounting. Expect court filing fees, service costs, appraisal fees, and attorney fees if counsel is used. The court may award costs to one party or apportion them from sale proceeds.
When a co-owner can force a sale
Any co-owner who owns an undivided interest in the property (tenancy in common, or other nonexclusive ownership) can bring a partition action to force division or sale. Tenants in joint tenancy can also seek partition, although joint tenancy often involves different consequences for survivorship; check title and deed language before proceeding.
Hypothetical example
Suppose three siblings each own a one-third share of a rental house. One sibling wants cash and cannot agree a buyout. The sibling files a partition action. The court determines a sale is appropriate; the house sells for $600,000, mortgages and liens total $200,000, and sale-related costs and fees are $20,000. Net proceeds are $380,000. After any court-ordered offsets (for example, one sibling paid $10,000 in major repairs and is credited that amount), the balance is split according to ownership (roughly one-third each, subject to the credit), so each sibling receives about $123,333 minus or plus allowed credits.
Helpful Hints
- Try negotiation first: a voluntary buyout saves time and court costs. Use a neutral appraiser to set value.
- Collect documentation: current deed, mortgage statements, proof of payments (mortgage, taxes, insurance), receipts for improvements, lease/rent records, and any written agreements among owners.
- Get a professional appraisal early to support settlement or court valuation.
- Consider mediation or neutral evaluation before filing suit—courts often encourage settlement, and mediators can craft buyout formulas that courts will respect.
- Understand credits and offsets: keep detailed records of any money you advanced for the property—courts commonly adjust distributions to reflect these payments.
- Talk to a real estate attorney: partition actions involve title, equitable accounting, and procedural rules. An attorney can explain local practices and timing in your county’s Superior Court.
- Be realistic about costs: legal fees and sale costs reduce net proceeds. A buyout that slightly undervalues the property might still be a better outcome than a long, expensive partition suit.
Where to read the law: California’s partition rules are in the Code of Civil Procedure, starting at Section 872.010. See Code Civ. Proc. § 872.010 and the sections that follow for detailed procedures and remedies.
When to hire an attorney
Hire an attorney if:
- Title is unclear or multiple encumbrances exist.
- Co-owners contest valuation, credits, or accounting.
- You need to protect a significant financial interest or face foreclosure risk.
Bring these to a first meeting: deed, mortgage statements, records of payments, tax records, leases, and any written agreements among owners.
Disclaimer: This information explains general California concepts and is not legal advice. For advice specific to your situation, consult a licensed California attorney.