As family owned property passes from generation to generation, it is becoming increasingly problematic for heirs receiving the legacy real estate to agree on what to do with the property. A legal tool is in place for just this occasion: a partition action.
For example, let's say a 180 parcel in Hugo or Scandia gets left to the three children. Perhaps one child wishes to own and reside on the property while another wishes to sell the property while yet another is indifferent. The children cannot agree on what to do, or how much should be paid to who or even what color the sky is. There's simply no foreseeable agreement. This is where a partition action is beneficial.
There are two types of relief that can be achieved pursuant to a partition action. First, a district court may order a partition in kind. Minn. Stat. § 558.01 (2016). A partition in kind is the “physical division of property held in tenancy in common. For example, a property owned by four co-tenants may be divided into four lots of equal size and equal value.
Second, a district court may order a partition in kind with compensation. Minn. Stat. § 558.11 (2016). “When it appears that partition cannot be made equal between the parties without prejudice to the rights or interests of some, the court may adjudge compensation to be made by one to another for equality of partition.” Id.
Compensation in a partition action is sometimes referred to as “owelty.” See, e.g., Kauffman v. Eckhardt, 195 Minn. 571, 573, 263 N.W. 610, 611 (1935). Owelty should be used “when necessary to make an equitable and fair division.” Hoerr v. Hoerr, 140 Minn. 223, 226, 165 N.W. 472, 474 (1917). Owelty may be ordered, “in an appropriate case without the consent of the tenant whose interest is charged.” Id. at 225, 165 N.W. at 473.
With these outcomes available it becomes easy to see how a partition action can resolve a real estate dispute. Both sides should plan on not being completely happy with the outcome, but both sides will still receive an outcome that reflects fairness and equity while permitting the parties to move on. There are several ways to go about undertaking a partition action, with some being cheaper than others. I am here to help you navigate through this as efficiently and productively as possible.
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