How sale proceeds are divided among co-owners after a partition sale in Massachusetts

Short answer: After a court orders a partition sale in Massachusetts, the sale proceeds are first used to pay mortgage liens, taxes, court-ordered costs (including sale costs and commissions), and any other recorded encumbrances. The remaining net proceeds are then divided among the co-owners according to their legal ownership shares, subject to court adjustments for contributions, improvements, payments of common expenses, or use-and-occupation claims the court finds equitable.

Detailed answer — how the process works under Massachusetts law

Partition is a court procedure that divides real property owned by two or more people who cannot agree on ownership or use. The usual alternatives are partition in kind (physically dividing the land) or partition by sale (selling the property and dividing the money). Massachusetts law governs partition actions under the partition statutes (see Massachusetts General Laws, Chapter 241: https://malegislature.gov/Laws/GeneralLaws/PartIV/TitleI/Chapter241).

1. Who receives what — basic rule

The basic rule is straightforward: after paying liens, taxes, and sale-related costs, the court distributes the remaining proceeds in proportion to each co-owner’s legal interest in the property (for example, 50/50 for two equal tenants in common).

2. What gets paid first

Senior recorded liens and mortgages. A mortgage that is senior to others is paid from sale proceeds according to its priority.
Costs of sale and court costs. These include real estate broker commissions, closing costs, advertising, and court fees ordered by the judge.
Unpaid property taxes or municipal liens.

The partition order will typically instruct the court or a commissioner handling the sale to pay these items out of the gross sale proceeds before distributing the remainder.

3. Adjustments and equitable claims the court may make

Although ownership-share division is the starting point, Massachusetts courts can and do make equitable adjustments when fairness requires. Typical adjustments include:

Contributions to the purchase price: If a co-owner paid more toward buying the property but the deed shows equal shares, the court may order an accounting and adjust the distribution to reflect those payments.
Payments of mortgage, taxes, insurance, and upkeep: A co-owner who paid most or all of these costs may receive credit before proceeds divide.
Improvements and repairs: If a co-owner made improvements that increased value, the court may reimburse that co-owner or adjust shares. Conversely, the court may reduce a co-owner’s share for waste or damage they caused.
Use-and-occupation or rents and profits: If one co-owner exclusively occupied the property or collected rent, the court can order an offset (credit or charge) for fair rental value or profits.

These equitable adjustments come from the court’s broad power to fashion a fair accounting among parties in a partition action.

4. Situations that commonly affect the final split

Unequal contributions by agreement or proof: Written agreements about shares control if valid; absent that, the deed controls ownership shares and the court considers proof of contributions.
Outstanding secured debt greater than sale price: If lien(s) exceed the sale proceeds, the lender(s) may take all proceeds and co-owners may receive nothing; co-owners could remain liable for any deficiency depending on the mortgage terms and foreclosure law.
Costs of partition itself: Parties often split court and attorney costs as the judge orders; sometimes the court charges costs against individual shares if one party unreasonably forced the partition.

5. Example calculation (hypothetical)

Facts:

Two tenants in common own a house 50/50.
Sale price: $300,000.
Mortgage balance: $100,000 (paid first).
Sale costs, commissions, closing: $15,000.
Outstanding property taxes: $5,000.

Gross sale proceeds $300,000 minus mortgage $100,000 = $200,000. Minus sale costs $15,000 and taxes $5,000 leaves net proceeds $180,000. Dividing that 50/50 gives each co-owner $90,000, subject to any court-ordered credits (for mortgage payments, repairs, or occupancy) that would adjust those amounts.

6. Where to find the law

Partition law in Massachusetts is codified in Chapter 241 of the Massachusetts General Laws; see: Mass. Gen. Laws ch. 241 (Partition of Lands). Property ownership and deeds are covered elsewhere in the General Laws, including Chapter 183 (see Mass. Gen. Laws ch. 183).

Helpful Hints

Gather documents: deed(s), mortgage statements, tax bills, receipts for repairs or improvements, lease agreements, and any written agreements about ownership shares or payments.
Know your title: The deed usually states each party’s legal share. If the deed is ambiguous, the court may look to evidence of contribution and intent.
Expect an accounting: Be ready to show payments you made (mortgage, taxes, insurance), and to request credits for payments you believe should reduce your co-owner’s share.
Consider mediation: Parties sometimes avoid cost and delay by agreeing on a sale and a division formula before the court proceeds.
Ask about occupancy credits: If you lived in or rented the property, ask the court to account for fair rental value or for the occupying co-owner to pay use-and-occupation damages.
Plan for liens: Know the priority and balance of any mortgages or liens; a senior lien can exhaust sale proceeds before distribution to owners.
Talk to a lawyer early: A lawyer can explain likely adjustments, represent you in court, and help assemble the required accounting documents.

Disclaimer: This article explains generally how partition sales and distribution of proceeds work in Massachusetts. It is educational only and does not constitute legal advice. For advice about your specific situation, consult a Massachusetts attorney licensed to practice in real estate or civil litigation.