The law understands that not everyone wants to own land with someone else indefinitely. If all co-owners agree to sell or to divide it, that’s easy. What if all co-owners can’t agree? With inherited land, what if you cannot find all of the co-owners, or if you are not sure who they are? The legal process called partition can help. Partition actions allow the court-ordered sale or division of land even if some co-owners oppose it, and even if you cannot identify or locate all of the owners to be able to ask their consent. This article discusses the partition process in North Carolina.
If it is a large tract that is feasible to divide, you have two choices. One option is a partition in kind, which divides the land into separate parcels. All owners who want their individual interests surveyed off in parcels corresponding to their percentage interest can do so (e.g., if you own a 25% interest, you will receive a surveyed parcel that is worth 25% of the original parcel’s value, which may not be the same as 25% of the total acreage).
The other option is a partition by sale, which orders the land sold and the money divided among the owners in proportion to their interests. If you own a 25% interest in the parcel, you will receive 25% of the net proceeds of the sale after payment of associated costs. Partition by sale is the only option when the parcel is small or when dividing it into the correct shares is not feasible, like when it consists of a house and lot. Partition by sale is the more practical option when there are many heirs, since tiny lot sizes are problematic and may be prohibited by zoning rules. Partition by sale also makes it easy for a judge to order reimbursement of attorney’s fees and costs to the person who brought the action from the other owners’ proceeds. The sale can be a private sale (based on an existing contract) or it can be an advertised public sale at the courthouse.
A lawyer handling the partition of inherited land must do a family history search to be sure all heirs who can be found are notified. Running a newspaper notice will be sufficient to serve heirs who cannot be found, and also satisfies the obligation to notify any others who think they may have inherited an interest in the property. Sales proceeds for unlocated heirs are paid to the Clerk of Court.
What if one co-owner owes money to a judgment creditor? If the judgment is not recorded in the county where the land is, it is not a problem. It is important to send notice to judgment creditors who recorded their judgment in the same county as the land so that they can act to protect their interest if desired (for example, by bidding at a public sale). Failing to notify these creditors means that whoever becomes the owner of the land (you, other family members, or a buyer you have no connection to) will not get good title; the judgment creditor would still have a claim on the land. Notifying creditors properly prevents that problem.
If you no longer want to own property with others from an inheritance or after a divorce, partition may be the solution.
Kim K. Steffan is an attorney with Steffan & Associates, P.C. in Hillsborough. She can be reached at 919-732-7300 or at firstname.lastname@example.org.