A partition action is often necessary when more than one person owns a piece of property. Sometimes, when there are multiple owners, those owners no longer wish to reside together or to co-own the property. This can happen either because the property owners purchased the property together and now wish to go their separate ways, or because the property was left to more than one party in a will and the parties do not wish to co-own together.
Partition of real property is defined as the separation of undivided and coexisting interests in real property, either by division or sale. In Florida, there are two mains types of property division:
- Partition in Kind – This method physically divides the property between the parties leaving a physical boundary that separates each party’s land. The parties will no longer co-own the property, but instead will each own a portion in their own name. Partitions in kind are usually reserved for large tracts of vacant land, where it would be easy to divide the parcel into two separate pieces.
- Partition by Sale – If it is impracticable to divide the property by carving out a portion for each owner, Florida partition sale laws allow the property to be sold at auction. The property would be sold to a third party and the proceeds from the sale would be divided between the two owners. A partition sale is a common type of partition action in residential properties, because it would be difficult to divide a residential home for multiple owners to reside within it.
It is important to note that Florida is a lien theory state, which means that any lender or mortgagor has a lien on the property for the amount of the outstanding loan. If the Florida partition action results in a sale of the property, the owners can only take proceeds after the lien belonging to the bank has been paid off.
In Florida, the proceeds or carved up land resulting from a partition must be divided among the parties according to their interest in their original tenancy. Florida has three types of tenancies for concurrent owners: joint tenants, tenants in common, or tenants by the entirety. Joint tenants have equal ownership interest in the property and thus, the land or monies must be divided equally between the two parties. Tenants in common own a percentage of the property and thus, the land or monies is divided based on the amount each party contributed to the property or the percentage of ownership they contractually agreed to. A tenancy by the entirety is a special tenancy reserved for married couples. Partitions linked with divorce proceedings may need to be heard in conjunction with the divorce process in family court.
The calculation of the proceeds from a partition sale also takes into consideration each co-tenant’s liability for his/her proportionate share of the obligations and expenses of the real property. One co-tenant’s equity should not be increased by the expenditures of the other co-tenant. Accordingly, a cotenant paying more than his/her proportionate share is entitled to a credit from the proceeds of sale from the other cotenant’s proportionate share of the expenses.
Additionally, if one cotenant makes improvements to the property which enhances its value, the cotenant paying for such improvements can obtain part of the proceeds attributable to the improvements in excess of the share otherwise due. This can be determined by getting an appraisal or valuation of the improvements that enhanced the real property’s value.
Lastly, each co-owner of real property is responsible for a share of the attorney’s fees and costs related to the partition action. This is why it is critically important to retain an experienced real estate lawyer to simplify the partition process and evaluate what out-of-court options are available.
Call the Law Offices of Jarrett R. Williams, P.A. today to have our attention to detail and real estate transactional and litigation experience provide you with the insight to achieve solutions to your most complex real estate matters.
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