Force Sale of co-owned property

[nonlegalmind]

A property (residential, non partionable) is split between cousins of 2 families. My family have a minority 1/3rd share and the other family have a 2/3rd share, we are tenants in common. Over the last number of years, the property has been occupied by members of one or other of the families with no rental agreement or rent passing between the families. One of the cousins in the other family is a minor and the share is being held in trust by their parent. There is no prior agreement in place.

At this juncture, my family want to sell the property or be bought out and have been saying this for the past 2 years. At a recent meeting, the other family refused to buy us out or to sell the property and split the proceeds. They insist that the property be let, dividing the rental income according the shareholding. The projected rental income per person is substantially less than what could be earned in interest if the proceeds (after CGT) were invested in a decent deposit account. The likelihood of further capital appreciation in the property seems remote in the current property climate. So it doesn't seem to represent a financially viable option to hold onto it especially seeing as the deposit income from the invested proceds would exceed the rental income.

Althought we have stated that we do not want the property to be let, we are fearful the other family wll let it out anyway. If it was let, this could be used as a delaying tactic for any sale as there would be sitting tenants etc.

Q1. As minority shareholders, do we have a right to prevent the property being let? How could this be achieved?

Q2. How can the sale be forced?

Q3. How much might it cost?

Q4. If it went to court, is there any reason why we wouldnt be granted an order to sell (the minor who's share is in trust?)

Q5. How might costs be awarded if the order was granted?

 

[mf1]

You need to see a solicitor.

You can issue Partition proceedings and the Court will more than likely order that the property be sold and the proceeds split. The minor's share may be an issue.

Court proceedings are extreme - it should not be necessary if everyone is willing to be reasonable. However, where that is not the case, then it is usually the only real option.

If you can show that reasonable efforts have been made to reach amicable agreement, there is some chance that if it does end up in Court that you will be awarded costs. Be sure that there is correspondence on file indicating your preference for amicable resolution. The Court will be interested in what efforts have been made.

I find that if proceedings are threatened ( but not issued) that leverage disappears. If proceedings are threatened, they should be issued and pursued. Nothing like it for concentrating the mind. But you will be warned that you are on risk for the costs as the solicitor cannot tell you what the Court will do.

mf

 

[nonlegalmind]

that's pretty much what i thought.

any ideas on preventing the property being let in the immediate future?

 

[mf1]

1. Letter from owners followed by
2. Letter from solicitor confirming proceedings about to issue and holding them responsible for any damages/costs/expenses incurred as a result of having tenants in
3. Last resort - interim injunction pending full hearing of partition action.

Thats the nuclear action! Not recommended if there is ever to be any possibility of anyone ever speaking again.

mf

 

[McCrack]

I was under the assumption that in a non-marital context property could only be partitioned by a court if it was only held jointly in equal shares?

 

[mf1]

I was under the assumption that in a non-marital context property could only be partitioned by a court if it was only held jointly in equal shares?

No - I don't believe so. I understand that a Court will make a Partition and Sale Order where parties cannot agree on what they want to do. In any event, most of these cases will be compromised when it becomes clear that either (a) the property is bought out by one of the parties or (b) the property is sold and the proceeds split as per the percentage ownership.

I don't believe a Court will allow a situation where one owner is being compelled to stay in an ownership situation where they cannot realise their share of the asset.

mf