Partition Lawsuits in Michigan: A Property Owner’s Basic Guide
Partition lawsuits are common disputes among co-owners of real property. When co-owners cannot agree on the use, possession, or division of a property, a partition action provides a legal mechanism for the parties to resolve the dispute, and if not, an equitable means to determine and distribute the property's value. This article will explore the basics of partition lawsuits in Michigan, highlighting key statutes and court rules to help you better understand the process.
Understanding Partition Lawsuits in Michigan:
A partition lawsuit is a legal action used to resolve disputes between co-owners of real property. It seeks a court-ordered division or sale of the property to ensure each co-owner receives their fair share. Any joint tenant or tenant in common may sue for a partition of the property. The owner seeking partition does not have to demonstrate any fault or wrongdoing of the other owner; seeking partition is a right of any co-owner. Common reasons for partition include (1) disagreements on property use or management, (2) disputes over the division of property proceeds, and (3) co-owners wanting to end their shared ownership.
Initiating a Partition Action:
Michigan Court Rule (MCR) 3.401 governs partition actions in Michigan and outlines the procedure for initiating the suit. Steps generally will include the filing of a complaint with the court, as well as service of process to all interested parties.
Judicial Decision
Michigan judges typically consider two primary methods of partition:
Partition by Sale: The court orders the property to be sold, and the proceeds are divided among the co-owners.
Partition in Kind: The court divides the property physically, giving each co-owner a portion based on their ownership percentage.
MCR 3.402 addresses the procedure for selling property in a partition action, detailing how the sale is conducted, including appraisal, notice, and the auction process.
Appointment of Receiver
MCR 3.402(B) specifically calls for the court to appoint a disinterested person, typically called a “Receiver” or “Partition Commissioner”, to oversee the sale and distribute the net proceeds. Receivers are generally trained legal professionals specialized in the relevant business or real estate area.
Considerations for Co-Owners:
Attorney Representation: Co-owners may benefit from legal counsel to protect their each of interests and navigate the partition process effectively.
Fair Market Value: The court aims to achieve a fair market value for the property through sale or division. This likely may require an appraisal.
Document Expenses: If you are planning for a partition suit, it’s best to get documentation of all expenses you’d incurred for the property, as well as the cost and value of any improvements made. These factors may affect the distribution of sale proceeds between co-owners.
Financing: If the property in question is subject to a mortgage, parties should think through whether partition could disrupt that, or if additional financing needs to be aquired.
Length of Time: Given the intricacies in getting the property appraised, appointing a receiver, and possibly undertaking new financing, a partition suit is likely to take months, if not years, to resolve.
Settlement Options: Any sentimental value associated with the property may make it unlikely that a party will consent to a sale. Given that, Co-owners should explore settlement agreements, potentially avoiding a court-ordered partition.
Conclusion:
Partition lawsuits in Michigan are a vital legal tool for resolving disputes among co-owners of real property. Understanding the process, is crucial to best protect the rights of both plaintiffs and defendants. Often parties are compelled to file a partition suit to force action on behalf of an unwilling co-owner. Legal representation and negotiation skills can help co-owners achieve the best possible outcome in these often complex and emotionally charged disputes.
This blog is for informational purposes only. It is not intended as legal advice. In the event you would like to speak with a real estate attorney about your case Contact Us at (734) 743-1646 to schedule a consultation.
