Legal Question in Real Estate Law in New Jersey

"I own a property in ocean city with 7 siblings (condo left to us after our parents passed away.) I am asking to be bought out. It is my understanding that there is a 'penalty' applied to the value of share, Anywhere from 0 to 35%. Is that true? And, help me understand the reasoning behind it?

Asked on 9/03/13, 5:21 am

2 Answers from Attorneys

Barry Gartenberg Barry F. Gartenberg LLC
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It sounds like you are referring to the "minority interest discount" which is applied when less than a controlling ownership interests in business is valued. In such cases, one can argue that a minority interest in a business should be discounted because the owner lacks the ability to control the business and the interest is not readily marketable. Minority discounts are not "mandatory." The applicability of the discount is most typically negotiable. Please feel free to contact me if you want more information (973-921-0600). Kindly understand, this does not constitute legal advice or opinion. And, this this exchange does not create an attorney-client relationship.

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Answered on 9/03/13, 6:16 am
Miriam Jacobson Law Offices of Miriam N. Jacobson
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The business minority situation doesn't really apply to buy-outs among siblings for a property they own in common. They may be trying to push you into giving up your interest for less than its value. If you consult with Mr. Gartenberg, mention this to him.

THIS RESPONSE IS NOT LEGAL ADVICE, SINCE I DO NOT HAVE ALL OF THE INFORMATION THAT WOULD BE REQUIRED, AND I DO NOT HAVE A REPRESENTATION AGREEMENT WITH YOU.

* If the answers to your question confirm that you have a valid issue or worthwhile claim, your next step should almost always be to establish a dialog with a lawyer who can provide specific advice to you. Contact a lawyer in your county or township.

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Answered on 9/03/13, 8:25 am

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