Partition in Kind vs. Partition by Sale
In the event co-owners are unable to settle a dispute related to the use of a shared property, a partition action may be necessary. Two types of partitions used in North Dakota include partition in kind and partition by sale. The type of partition ordered by the court will depend on the characteristics of the property, the objectives of the co-owners, and whether physical division would cause substantial harm.
Key Takeaways
- A partition action is the legal process that divides real property owned by two or more individuals.
- A partition in kind is a court action that physically divides a property among co-owners.
- A partition by sale can be used when physical division of a property is impossible or impractical.
What is a Partition Action?
A partition action is the legal process that divides a jointly owned property when co-owners cannot decide how it should be used or managed. These actions can be filed by any of the co-owners if an agreement cannot be reached outside the courtroom. The result of a partition action is a court order that either divides the property or requires it to be sold, with the proceeds divided among the owners. Two methods of partition in North Dakota include a partition in kind and partition by sale.
What is a Partition in Kind?
A partition in kind allows the property to be physically divided among the co-owners. In these cases, referees would be appointed to divide the property in accordance with each owner’s respective rights as determined by the court. They would also be required to consider the quality and quantity of the property when making the division, designating the parcels by the proper landmarks. A surveyor may be used to assist with the division.
When considering a partition in kind vs. a partition by sale, it’s important to be aware that a partition in kind is not always possible. Under North Dakota law, if there is evidence that a partition in kind would cause great prejudice to the owners, a partition by sale must be ordered. Usually, a court would appoint a referee for the purpose of assessing the value of the property. If the court determines, based on the referee’s report, that the parties would not be compensated equally, a party may be ordered to pay additional compensation to offset the inequality.
What is a Partition by Sale?
Partition by sale is typically ordered in situations where the physical division of the property is not possible. This method of partition allows a co-owner to force the sale of the entire property. The proceeds from the sale would then be distributed to each co-owner, in accordance with their share of ownership. A partition by sale is commonly used when division into separate parcels would be impractical or impossible, and result in financial hardship for any of the co-owners.
Some common scenarios where a partition by sale might be ordered can include the following:
- A physical division would cause the property to lose a significant amount of its value.
- The features or unique characteristics of the property make physical division impossible.
- The property contains structures that cannot be separated.
All property sales must be made by referees at public auction, and go to the highest bidder upon notice in the manner required.
Contact an Experienced North Dakota Real Estate Attorney
Whether partition in kind vs. partition by sale is ordered by the court, a partition action can be legally complex and emotionally overwhelming. It’s crucial to have a skillful real estate attorney by your side who can best advise you regarding your options and protect your interests. Located in Fargo, Fremstad Law offers trusted counsel for a broad range of real estate disputes in North Dakota and Minnesota, including those involving partition actions. We welcome you to contact us online or call 701-401-9220 to learn how we can assist you.
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