By: Elizabeth Boyette
One of the most effective legal remedies available for clients who are at an impasse on joint property ownership is a partition proceeding, which results in a forced sale of the real estate. NCGS § 46A provides a mechanism for property owners known as a petition to partition, which is a special proceeding before the county Clerk of Court to appoint a commissioner to sell the property by private sale. Typically, clients come to us after they have exhausted all other avenues to amicably work together once their relationship has deteriorated. Note that this option is not available for those parties who own property as a married couple, nor is it a possibility for those owning their property in an LLC. However, in situations where you have purchased property with another person, become divorced and now own the property as tenants in common, or have inherited property, the partition procedure may be right for you.
There are two types of partitions: actual partitions and partitions by sale. Actual partitions are available for large tracts of land that can be equitably divided amongst the parties. Partitions by sale are the best option for parties owning smaller properties that cannot be equitably divided by physically splitting them in half and are primarily the subject of this post.
In order to start the partition process, we generally write a demand letter to the other party requesting that they buy out our clients or agree to sell the property with a mutually agreed upon real estate agent within a certain timeframe. We provide a deadline for their response and work with the opposing party or his or her counsel to work towards an equitable resolution. If we receive no response, then we move forward with a petition to partition, which is a legal complaint that must be filed with the clerk and served upon the respondent. We then schedule a hearing after the respondent has been served with thirty days to provide his or her answer. At the hearing, the Clerk of Court determines whether the parties should go to mediation, or he or she issues an order appointing a neutral commissioner tasked with selling the property to a potential buyer in his or her discretion. The commissioner lists the property for sale, and after entering into a contract with the potential buyer, posts the contract at the courthouse for any other party to bid higher in 5% increments in the upset bid process, which starts over every ten days that someone bids higher. Once the Clerk enters the final order to sell the property and it closes, the commissioner deposits the proceeds with the Clerk of Court to be equitably divided between the parties (which is often determined in a second proceeding). This process can take 3-9 months depending on the complexities of the matter and the willingness of the parties to cooperate amicably. Contact us today if we can help you with your partition proceeding by emailing me at elizabeth@jacksonlawnc.com!
With this knowledge, now you can Rest Easy.
