Detailed Answer
Under Oregon law, when co-owners cannot agree about what to do with jointly owned real property, one co-owner can file a partition action in court. The court may divide the land physically (partition in kind) or order it sold and the proceeds divided (partition by sale). Oregon’s partition statutes and procedures are found in the Oregon Revised Statutes, Chapter 105 (see: ORS chapter 105).
This section explains what typically happens when the court appoints a commissioner to complete a private sale of a co-owner’s share and the co-owners disagree.
1. How the court decides to appoint a commissioner and allow a private sale
If the court finds that physical division is impractical or inequitable, it may order sale instead. The judge can appoint a commissioner (sometimes called a referee) to handle the mechanics of that sale. The court’s order will state the scope of the commissioner’s authority—whether to conduct a public auction, accept private offers, solicit bids, set minimum terms, or sell to a particular buyer. Any private sale requires court authorization and later court confirmation of the sale and the sale price.
2. Role and duties of the court-appointed commissioner
- The commissioner follows the court’s written order and applicable Oregon law. Typical duties include advertising the property (if required), showing the property, soliciting and receiving offers, negotiating terms (if the order permits), and reporting back to the court with a recommendation and the sale documents.
- The commissioner must act in good faith and provide an accounting and report to the court that details the sale price, offers received, expenses, and the proposed distribution of proceeds.
- The court usually requires notice to all parties (and may require notice to lienholders) before confirming any private sale so interested parties can object.
3. What happens if a co-owner objects to the private sale
A co-owner who objects has several options:
- File written objections or exceptions to the commissioner’s report and appear at the confirmation hearing.
- Ask the court to deny confirmation of the private sale and instead order a public sale, set a higher minimum price, or require additional marketing steps.
- Move to buy out other owners’ shares if the court’s order or the parties’ conduct allows a buyout at a court-determined value.
- Challenge procedural defects (for example, inadequate notice, failure to follow the court’s sale instructions, or conflicts of interest by the commissioner).
At the confirmation hearing the judge reviews the commissioner’s report, any objections, and evidence about the fairness of the sale price and the sale process. If the judge finds the sale was fair and followed the court’s order, the judge will confirm the sale. If not, the judge may refuse confirmation and send the matter back to the commissioner with new instructions or order a different sale method.
4. Timing and final steps
Typical steps and approximate sequence:
- Filing of partition action and service on co-owners.
- Court hearing on partition and appointment of commissioner with written instructions.
- Commissioner advertises/markets the property or solicits private offers as ordered.
- Commissioner files a report of sale and proposed distribution with the court, and provides notice of the confirmation hearing to parties and lienholders.
- Confirmation hearing: parties may object. The court confirms or rejects the sale or modifies the terms.
- If confirmed, the commissioner transfers title and the court orders distribution of net proceeds (after liens, taxes, and sale expenses) among the co-owners according to their interests or a court decree.
5. Distribution of proceeds
After confirmation and closing, the court oversees distribution: mortgage and lien payments, sale costs, and commissioner fees are paid first. The remaining proceeds are divided among co-owners according to their ownership shares or the court’s decree. If the parties disagree about accounting, they can ask the court to resolve disputes before final distribution.
6. Remedies if the commissioner or sale process was unfair
If a commissioner fails to follow the court order, has a conflict of interest, or conducts a sale in bad faith, a co-owner can ask the court to set aside the sale, remove the commissioner, or order a new sale. Court challenges typically require specific evidence: missed notice deadlines, undisclosed relationships, inadequate marketing, or sale below fair market value without justification.
Short illustrative example
Hypothetical: Two siblings, A and B, own a rental house. A files a partition action because B refuses to sell. The court appoints a commissioner and allows a private sale. The commissioner negotiates a private sale to Buyer C. B objects, saying the property wasn’t adequately marketed and the price seems low. At the confirmation hearing the court reviews marketing steps, competing offers (if any), and the commissioner’s accounting. If the court finds the process adequate, it confirms; if not, it can reject the sale and require additional marketing or a public auction.
For statutory background and more detail on partition procedure, see ORS chapter 105: https://www.oregonlegislature.gov/bills_laws/ors/Pages/ors105.aspx.
Helpful Hints
- Hire a lawyer experienced in Oregon partition law early. They can object properly, request appraisals, and protect your rights at the confirmation hearing.
- Get an independent appraisal. A credible appraisal helps you argue that the sale price is fair or too low.
- Preserve communications and records about marketing, offers, and the commissioner’s activities. Documentation matters if you must object.
- Consider settlement or a buyout. A negotiated buyout can avoid costs and uncertainty of a contested sale.
- Attend the confirmation hearing. Failing to appear or file timely objections can limit your options.
- Ask the court for specific sale conditions if you worry about low offers (minimum price, longer marketing period, public auction requirement).
- Be mindful of liens or tax obligations on the property—these typically get paid from sale proceeds first.
Disclaimer: This article explains general Oregon law and common procedures but is not legal advice. It does not create an attorney-client relationship. For advice about a specific situation, consult a licensed Oregon attorney who handles partition and real property matters.