Detailed Answer
Disclaimer: This article is for educational purposes only and does not constitute legal advice. Consult a qualified attorney for advice about your specific situation.
Under Vermont law, co-owners of real estate—including siblings who inherit property together—face the potential of a partition action if they cannot agree on how to use, manage, or divide the land. A partition action forces the court to physically divide the property (partition in kind) or order its sale (partition by sale) to distribute proceeds among co-owners. See 12 V.S.A. § 507 (partition by sale).
However, you and your siblings can negotiate outside of court to avoid a formal partition suit. Here are common approaches:
- Buy-out Agreement: One or more co-owners purchase another’s share at a mutually agreed price. This requires a professional appraisal to determine fair market value. Document the transaction with a purchase agreement and file a new deed.
- Co-ownership Agreement: Draft a written agreement outlining how the property will be used, maintained, and sold. Address cost sharing for taxes, insurance, and upkeep. Specify procedures for future buy-outs or sale.
- Mediation: Engage a neutral mediator experienced in real estate or estate disputes. Mediation can help parties reach creative solutions, such as rotating exclusive use or dividing the property physically, if feasible.
- Family Limited Liability Company (LLC) or Trust: Transfer the property into an entity managed by all siblings. Ownership interests become membership or trust shares, which are easier to transfer or redeem without court involvement.
If negotiations break down, any co-owner may file a partition action in the Superior Court of the county where the property lies. The court then decides whether to divide the land or order a sale. See 12 V.S.A. § 503 (who may be joined).
Key steps to keep negotiations on track:
- Secure up-to-date property valuation by hiring a licensed Vermont appraiser.
- Retain a real estate attorney to draft or review any buy-out or co-ownership agreement.
- Consider mediation early to preserve family relationships and reduce legal costs.
- Finalize any agreement in writing and record it with the Vermont land records office.
Helpful Hints
- Communicate openly: Establish ground rules for family meetings to discuss objectives and concerns.
- Get everything in writing: Verbal promises can lead to disputes later.
- Use neutral experts: Appraisers, mediators, and attorneys can keep negotiations objective.
- Review tax implications: A buy-out or sale may trigger capital gains or gift tax events.
- Plan for the future: Include provisions for selling or transferring interests if a sibling wants out later.