Legal Question in Business Law in California

Property Rents

Daughter owes me 25% of rents on a 3 unit property (in CA) that we both own for over a year now and I need to know what legal steps to take in collecting my share of the rents.


Asked on 7/10/09, 7:58 pm

3 Answers from Attorneys

Terry A. Nelson Nelson & Lawless

Re: Property Rents

Settle or sue, there aren't any other options.

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Answered on 7/12/09, 3:17 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Property Rents

The options include out-of-court processes such as negotiation, mediation and arbitration, or in-court processes. If there is no bona-fide dispute over the obligation to share rents or the amount, the out-of-court processes probably won't do much good, at least until the co-owner gets a starchy letter from your lawyer, or served with a lawsuit.

I can imagine plenty of excuses daughter might have for not paying, and maybe they should be examined carefully before filing sui or sending threatening letters. Is you agreement in writing? Is it clear and unequivocal? What is shared, gross rental receipts or net cash flow? Are there unusual expenses or vacancies affecting cash flow? What does the agreement say? Note: Even in the absence of an agreement, the law would impose a duty on a co-owner to account for and share rents received from third-party tenants.

If a lawsuit is necessary, perhaps it is within the Small Claims jurisdiction if the amount due you doesn't greatly exceed $7,500 and a money judgment is all you want. If the amount owed is substantially greater, or if you feel you should sue for partition to break up the co-ownership, then you'll need to sue in Superior Court.

Often (perhaps 80% of the time) such matters are settled before trial, because the non-paying party sees the inevitable result once served with a suit. Meanwhile, a suit would at least give you the opportinuty to get rental records (through discovery) and make sure the property is insured.

You are legally entitled both to your share of rental net income and to see the books and records.

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Answered on 7/12/09, 8:37 pm
Donald Scher Donald T. Scher & Associates, P.C.

Re: Property Rents

You should retain a lawyer and show your daughter that she must observe her fiduciary duties and obligations to you and give you your share of the rental income. If she does not comply, then you will have to sue her in CA to collect your share of the rents, and any damages she has caused.

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Answered on 7/11/09, 9:59 pm


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