Legal Question in Real Estate Law in California

Home ownership

I own a house with 3 siblings, the house is paid for, we only have to pay taxes and insurance. 1 sibling lives in the house. Can we make him pay rent and is it possible to force him to allow us to buy him out.


Asked on 7/06/09, 1:58 pm

5 Answers from Attorneys

James Roberts Roberts & Elliott LLP

Re: Home ownership

You can file a parition action to force the property to be sold and the shares divided up.

Jim Roberts

408.275.9800

www.robertselliott.com

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Answered on 7/06/09, 2:24 pm
Terry A. Nelson Nelson & Lawless

Re: Home ownership

Yes, and yes [sort of]. If done properly the partners can require reimbursement for rental value, or can force a partition, buy out or sale. If you are serious about doing so, feel free to contact me. It may be possible to 'negotiate' a resolution without having to file suit. That's what lawyer 'threat letters' are designed to do.

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Answered on 7/06/09, 2:27 pm
Scott Linden Scott H. Linden, Esq.

Re: Home ownership

Do you know how the home is titled? Are you all on as joint tenants? As tenants in common?

Although it may not be possible to directly force this sibling to allow you to buy him out, you can probably force a sale of the home where you and the other sibling purchase the home through an LLC that the two of you own. This would probably require complete disclosure, however.

As far as rent, this may also depend on how the home is titled. Generally, you can not force an owner to pay rent unless they are preventing the other owners from occupying the property. Since I would need more factual information, this question can not be directly answered any better than that at this time.

If you would like to discuss this matter further in a more private forum, please feel free to contact me directly at the email address provided by LawGuru or through our firmís website located at PasadenaEstatePlanning.com

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Answered on 7/06/09, 3:49 pm
OCEAN BEACH ASSOCIATES OCEAN BEACH ASSOCIATES

Re: Home ownership

Yes rent should be paid and a partition action would force a buy out. Contact me directly.

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Answered on 7/06/09, 5:28 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Home ownership

First, I assume you own the property as tenants in common or as joint tenants. If the ownership is through a family business such as a partnership, LLC, corporation, etc., the answers would be different.

As to the rent. Each co-owner has the full right of possession of the entire property. Legally, you are all involuntary "roommates" of sorts and no rent is due from anyone based on his election to exercise that right to occupy the property.

If co-owner A is in sole possession and is preventing co-owners B, C and D from exercising their rights to co-occupy the property by force, threats, intimidation, locking out, etc., and B, C and/or D are thus prevented from asserting their rights of co-possession, this may be an "ouster" (see Civil Code section 843) for which remedies including money damages may be available. The damages may be equivalent to rent in amount, but there is a conceptual difference between rent and damages for ouster.

So, you can't collect rent from a co-owner, but if the co-owner acts too greedily, you may have another remedy.

Next, as to forcing buy-outs. The law provides a remedy here too, that may or may not produce a desired result. Unhappy co-owners of property may file a special kind of lawsuit called a partition action. Historically, the court was asked to "partition" or physically subdivide dad's farm between the kids. In modern times, this often won't work, because the kids don't want to farm or because subdivision and zoning laws make it impractical to divide a house on a tiny city lot four ways. So, most partitioning is done by sale and divvying up the net sale proceeds.

Filing a partition suit sometimes ultimately results in a court-ordered sale, and distribution of the net proceeds of sale to the former co-owners on a legally-fair basis, taking into account extra costs a particular former co-owner may have paid.

Perhaps more often, filing the suit results in the co-owners sitting down together and hammering out an out-of-court settlement where, for example, co-owners A and C buy out co-owners B and D. Thus, family members who want to keep the old homestead in the family get it, and thos who want to bail out and get the money accomplish their objectives as well.

Partition suits may work well when full-blown litigation is absoultely necessary to end very bad splits of opinion between warring family factions. More often, their value is in bringing a reluctant co-owner to the bargaining table to negotiate a buy-out or similar negotiated outcome rather than risk the costs and uncertainty of a court-imposed settlement. Often these days, there is the added problem that due to declining property values and bad loans, a property cannot be partitioned because it has no net value and the proceeds won't pay the loans, not to mention the lawyers and real estate commission.

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Answered on 7/07/09, 11:10 pm


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