Detailed Answer
When co-owners of real estate in New York cannot agree on sale logistics or how to share costs, New York law provides several legal paths to resolve the dispute. The most common and formal method is a partition action under Article 9 of the Real Property Actions and Proceedings Law (RPAPL). Below is an overview of this process and alternative options.
1. Partition Action (RPAPL Article 9)
Either co-owner may file a partition suit in New York Supreme Court. Under RPAPL § 901 et seq. (Real Property Actions and Proceedings Law Article 9), the court can:
- Order a partition in kind, dividing the property physically among co-owners if feasible.
- Order a partition by sale, requiring the property to be sold and proceeds distributed according to each party’s ownership share.
- Allocate sale costs and expenses, including appraisal, broker fees, taxes, and legal fees, among co-owners.
The court balances interests and may award one co-owner exclusive possession for a period, subject to rent or use value paid to others.
2. Court-Approved Buyout
Instead of selling to a third party, one co-owner may petition the court for a buyout. The court orders an appraisal and sets a fair market value. The purchasing co-owner pays the other co-owner’s share, assuming sole ownership and responsibility for ongoing costs.
3. Mediation or Arbitration
Parties can agree to mediation or binding arbitration before or after filing a partition action. A neutral mediator or arbitrator helps negotiate sale terms, cost sharing, or buyout amounts. Courts often stay partition actions pending mediation under RPAPL § 911.
4. Private Settlement and Operating Agreements
If co-owners proactively draft or update a co-ownership agreement (or, for LLCs, an operating agreement), they can specify:
- Sale procedures and notice requirements
- Cost-sharing formulas for maintenance, taxes, and closing costs
- Buyout rights and valuation methods
Such agreements carry significant weight in court and may avoid litigation entirely.
Helpful Hints
- Review RPAPL Article 9 early to understand your rights: RPAPL § 901–962.
- Consider a neutral appraisal to set realistic expectations for sale price or buyout value.
- Keep thorough records of expenses paid (taxes, repairs) to seek reimbursement in court.
- Explore mediation before litigation to save on time and legal costs.
- Consult a real estate attorney experienced in partition law for procedural guidance and settlement negotiations.
Disclaimer: This article provides general information on New York co-ownership disputes. It does not constitute legal advice. Consult a qualified attorney to address your specific situation.