Section § 874.311

Explanation
The Partition of Real Property Act lays out rules for dividing real estate that's co-owned when there's no existing agreement about how to split it. This law is specifically for property where multiple people own it together as tenants in common, and it applies only to partition actions filed from January 1, 2023, onward.
(a)CA Civil Procedure Code § 874.311(a) This act shall be known, and may be cited, as the Partition of Real Property Act.
(b)CA Civil Procedure Code § 874.311(b) This act applies to real property held in tenancy in common where there is no agreement in a record binding all the cotenants which governs the partition of the property.
(c)CA Civil Procedure Code § 874.311(c) This act applies to actions for partition of real property filed on or after January 1, 2023.

Section § 874.312

Explanation

This law section defines key terms used in a chapter dealing with property division. It clarifies that a 'determination of value' is a court order setting the property's fair market value or agreeing on a value with all co-owners. 'Partition by sale' refers to a court-ordered sale of property as a whole. 'Partition in kind' is when a property is divided into separate parcels. Lastly, 'record' is information that is recorded on a physical or digital medium and can be retrieved in a perceivable form.

For purposes of this chapter, the following definitions apply:
(a)CA Civil Procedure Code § 874.312(a) “Determination of value” means a court order determining the fair market value of the property under Section 874.316 or 874.320 or adopting the valuation of the property agreed to by all cotenants.
(b)CA Civil Procedure Code § 874.312(b) “Partition by sale” means a court-ordered sale of the entire property, whether by auction, sealed bids, or open-market sale conducted under Section 874.320.
(c)CA Civil Procedure Code § 874.312(c) “Partition in kind” means the division of property into physically distinct and separately titled parcels.
(d)CA Civil Procedure Code § 874.312(d) “Record” means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

Section § 874.313

Explanation

If there's a legal action about dividing real estate that multiple owners share, the division must follow the procedures in this chapter unless all the owners formally agree to do it differently. This chapter adds to other related laws, but if there are conflicts, the rules in this chapter take priority.

(a)CA Civil Procedure Code § 874.313(a) In an action to partition real property, the property shall be partitioned under this chapter unless all of the cotenants otherwise agree in a record.
(b)CA Civil Procedure Code § 874.313(b) This chapter supplements the other provisions of this title and, if an action is governed by this chapter, this chapter shall control over any provisions of this title that are inconsistent with this chapter.

Section § 874.314

Explanation

This law explains that there are no restrictions on how a complaint can be served in a partition case. If someone initiates a partition lawsuit and wants to notify others through a public announcement, they must also put a clear sign on the property within 10 days after the court decides. This sign must stay up while the case continues and must mention that the case has started, the court's name and address, and how the property is commonly known. The court might also require that the sign includes details like the names of the people involved in the lawsuit.

(a)CA Civil Procedure Code § 874.314(a) This act does not limit or affect the method by which service of a complaint in a partition action may be made.
(b)CA Civil Procedure Code § 874.314(b) If the plaintiff in a partition action seeks an order of notice by publication, the plaintiff, not later than 10 days after the court’s determination, shall post and maintain while the action is pending a conspicuous sign on the property that is the subject of the action. The sign shall state that the action has commenced and identify the name and address of the court and the common designation by which the property is known. The court may require the plaintiff to publish on the sign the name of the plaintiff and the known defendants.

Section § 874.315

Explanation
If a court appoints referees to help in a legal case related to property division, those referees must be neutral and unbiased. They cannot have any personal interest in the case or be involved in it.
If the court appoints referees pursuant to Section 873.010, each referee, in addition to any other requirements and disqualifications applicable to referees, shall be disinterested and impartial and not a party to or a participant in the action.

Section § 874.316

Explanation

This section outlines how the court should determine the fair market value of a property when multiple owners are involved. Generally, the court orders an appraisal by a neutral, licensed appraiser unless all owners agree on a value or another valuation method. If an appraisal's cost outweighs its usefulness, the court may decide on the property's value without it. Once an appraisal is completed, the court notifies all parties, who can object within 30 days. Regardless of objections, a hearing will be held to set the property's fair market value before moving forward with property division. The court also considers other evidence of value presented by the parties.

(a)CA Civil Procedure Code § 874.316(a) Except as otherwise provided in subdivisions (b) and (c), the court shall determine the fair market value of the property by ordering an appraisal pursuant to subdivision (d).
(b)CA Civil Procedure Code § 874.316(b) If all cotenants have agreed to the value of the property or to another method of valuation, the court shall adopt that value or the value produced by the agreed method of valuation.
(c)CA Civil Procedure Code § 874.316(c) If the court determines that the evidentiary value of an appraisal is outweighed by the cost of the appraisal, the court, after an evidentiary hearing, shall determine the fair market value of the property and send notice to the parties of the value.
(d)CA Civil Procedure Code § 874.316(d) If the court orders an appraisal, the court shall appoint a disinterested real estate appraiser licensed in the State of California to determine the fair market value of the property assuming sole ownership of the fee simple estate. On completion of the appraisal, the appraiser shall file a sworn or verified appraisal with the court.
(e)CA Civil Procedure Code § 874.316(e) If an appraisal is conducted pursuant to subdivision (d), not later than 10 days after the appraisal is filed, the court shall send notice to each party with a known address, stating all of the following:
(1)CA Civil Procedure Code § 874.316(e)(1) The appraised fair market value of the property.
(2)CA Civil Procedure Code § 874.316(e)(2) That the appraisal is available at the court clerk’s office.
(3)CA Civil Procedure Code § 874.316(e)(3) That a party may file with the court an objection to the appraisal not later than 30 days after the notice is sent, stating the grounds for the objection.
(f)CA Civil Procedure Code § 874.316(f) If an appraisal is filed with the court pursuant to subdivision (d), the court shall conduct a hearing to determine the fair market value of the property not sooner than 30 days after a copy of the notice of the appraisal is sent to each party under subdivision (e), whether or not an objection to the appraisal is filed under paragraph (3) of subdivision (e). In addition to the court-ordered appraisal, the court may consider any other evidence of value offered by a party.
(g)CA Civil Procedure Code § 874.316(g) After a hearing under subdivision (f), but before considering the merits of the partition action, the court shall determine the fair market value of the property and send notice to the parties of the value.

Section § 874.317

Explanation

If someone who co-owns a property (a cotenant) wants the property to be sold, the court will inform the others. Those other cotenants can choose to buy the shares of those who want to sell. They have 45 days to make this choice. If only one cotenant decides to buy, the court notifies everyone. If multiple cotenants want to buy, they'll split it based on their current ownership shares. If no one chooses to buy, the process moves forward as if a sale is happening. Once decisions are made, the court sets a deadline (at least 60 days out) for buyers to pay. If payments are made, the court redistributes the ownership shares and handles the money accordingly. If not all buyers pay, others can step in to buy at set prices. Payments, shares, and any leftover funds get sorted by the court. Additionally, cotenants can ask the court to sell the shares of those who didn't participate in the legal process. The court will hold a hearing and set fair terms if this happens.

(a)CA Civil Procedure Code § 874.317(a) If any cotenant requested partition by sale, the court shall, after the determination of value under Section 874.316, send notice to the parties that any cotenant except a cotenant that requested partition by sale may buy all the interests of the cotenants that requested partition by sale.
(b)CA Civil Procedure Code § 874.317(b) Not later than 45 days after the notice is sent under subdivision (a), any cotenant except a cotenant that requested partition by sale may give notice to the court that it elects to buy all the interests of the cotenants that requested partition by sale.
(c)CA Civil Procedure Code § 874.317(c) The purchase price for each of the interests of a cotenant that requested partition by sale is the value of the entire parcel determined under Section 874.316 multiplied by the cotenant’s fractional ownership of the entire parcel.
(d)CA Civil Procedure Code § 874.317(d) After expiration of the period described in subdivision (b), the following rules apply:
(1)CA Civil Procedure Code § 874.317(d)(1) If only one cotenant elects to buy all the interests of the cotenants that requested partition by sale, the court shall notify all the parties of that fact.
(2)CA Civil Procedure Code § 874.317(d)(2) If more than one cotenant elects to buy all the interests of the cotenants that requested partition by sale, the court shall allocate the right to buy those interests among the electing cotenants based on each electing cotenant’s existing fractional ownership of the entire parcel divided by the total existing fractional ownership of all cotenants electing to buy and send notice to all the parties of that fact and of the price to be paid by each electing cotenant.
(3)CA Civil Procedure Code § 874.317(d)(3) If no cotenant elects to buy all the interests of the cotenants that requested partition by sale, the court shall send notice to all the parties of that fact and resolve the partition action under paragraphs (a) and (b) of Section 874.318.
(e)CA Civil Procedure Code § 874.317(e) If the court sends notice to the parties under paragraph (1) or (2) of subdivision (d), the court shall set a date, not sooner than 60 days after the date the notice was sent, by which electing cotenants shall pay their apportioned price into the court. After this date, the following rules apply:
(1)CA Civil Procedure Code § 874.317(e)(1) If all electing cotenants timely pay their apportioned price into court, the court shall issue an order reallocating all the interests of the cotenants and disburse the amounts held by the court to the persons entitled to them.
(2)CA Civil Procedure Code § 874.317(e)(2) If no electing cotenant timely pays its apportioned price, the court shall resolve the partition action under paragraphs (a) and (b) of Section 874.318 as if the interests of the cotenants that requested partition by sale were not purchased.
(3)CA Civil Procedure Code § 874.317(e)(3) If one or more but not all of the electing cotenants fail to pay their apportioned price on time, the court, on motion, shall give notice to the electing cotenants that paid their apportioned price of the interest remaining and the price for all that interest.
(f)CA Civil Procedure Code § 874.317(f) Not later than 20 days after the court gives notice pursuant to paragraph (3) of subdivision (e), any cotenant that paid may elect to purchase all of the remaining interest by paying the entire price into the court. After the 20-day period, the following rules apply:
(1)CA Civil Procedure Code § 874.317(f)(1) If only one cotenant pays the entire price for the remaining interest, the court shall issue an order reallocating the remaining interest to that cotenant. The court shall promptly issue an order reallocating the interests of all of the cotenants and disburse the amounts held by it to the persons entitled to them.
(2)CA Civil Procedure Code § 874.317(f)(2) If no cotenant pays the entire price for the remaining interest, the court shall resolve the partition action under paragraphs (a) and (b) of Section 874.318 as if the interests of the cotenants that requested partition by sale were not purchased.
(3)CA Civil Procedure Code § 874.317(f)(3) If more than one cotenant pays the entire price for the remaining interest, the court shall reapportion the remaining interest among those paying cotenants, based on each paying cotenant’s original fractional ownership of the entire parcel divided by the total original fractional ownership of all cotenants that paid the entire price for the remaining interest. The court shall issue promptly an order reallocating all of the cotenants’ interests, disburse the amounts held by it to the persons entitled to them, and promptly refund any excess payment held by the court.
(g)CA Civil Procedure Code § 874.317(g) Not later than 45 days after the court sends notice to the parties pursuant to subdivision (a), any cotenant entitled to buy an interest under this section may request the court to authorize the sale as part of the pending action of the interests of cotenants named as defendants and served with the complaint but that did not appear in the action.
(h)CA Civil Procedure Code § 874.317(h) If the court receives a timely request under subdivision (g), the court, after a hearing, may deny the request or authorize the requested additional sale on such terms as the court determines are fair and reasonable, subject to the following limitations:
(1)CA Civil Procedure Code § 874.317(h)(1) A sale authorized under this subdivision may occur only after the purchase prices for all interests subject to sale under subdivisions (a) to (f), inclusive, have been paid into court and those interests have been reallocated among the cotenants as provided in those subdivisions.
(2)CA Civil Procedure Code § 874.317(h)(2) The purchase price for the interest of a nonappearing cotenant is based on the court’s determination of value under Section 874.316.

Section § 874.318

Explanation

This section explains what happens when co-owners of a property, known as cotenants, can't agree on how to divide or sell their shared property. If some cotenants want the property to be physically divided, called partition in kind, the court will generally agree to this unless it would unfairly harm any cotenants as a group. The court might group the interests of those who want to combine their shares. If partition in kind isn't ordered, the court may decide to sell the property or dismiss the case. When partition in kind is used, some cotenants may have to pay others to ensure everyone gets their fair share. Moreover, shares for cotenants who can't be found or are under default judgment will still be accounted for by the court.

(a)CA Civil Procedure Code § 874.318(a) If all the interests of all cotenants that requested partition by sale are not purchased by other cotenants pursuant to Section 874.317, or if after conclusion of the buyout under Section 874.317 a cotenant remains that has requested partition in kind, the court shall order partition in kind unless the court, after consideration of the factors listed in Section 874.319, finds that partition in kind will result in great prejudice to the cotenants as a group. In considering whether to order partition in kind, the court shall approve a request by two or more parties to have their individual interests aggregated.
(b)CA Civil Procedure Code § 874.318(b) If the court does not order partition in kind under subdivision (a), the court shall order partition by sale pursuant to Section 874.320 or, if no cotenant requested partition by sale, the court shall dismiss the action.
(c)CA Civil Procedure Code § 874.318(c) If the court orders partition in kind pursuant to subdivision (a), the court may require that one or more cotenants pay one or more other cotenants amounts so that the payments, taken together with the value of the in-kind distributions to the cotenants, will make the partition in kind just and proportionate in value to the fractional interests held.
(d)CA Civil Procedure Code § 874.318(d) If the court orders partition in kind, the court shall allocate to the cotenants that are unknown, unlocatable, or the subject of a default judgment, if their interests were not bought out, a part of the property representing the combined interests of these cotenants as determined by the court.

Section § 874.319

Explanation

This law section outlines how a court decides if splitting a property into parts would unfairly harm all the co-owners. The court looks at several factors, including whether the property can be divided fairly, if selling the whole property is more valuable than dividing it, any historical ownership ties, sentimental attachment, current uses of the property, contributions to property expenses, and any other relevant issues. Each factor is considered in the context of all other circumstances, meaning no single factor alone will decide the outcome.

(a)CA Civil Procedure Code § 874.319(a) In determining whether partition in kind would result in great prejudice to the cotenants as a group, the court shall consider the following:
(1)CA Civil Procedure Code § 874.319(a)(1) Whether the property practicably can be divided among the cotenants.
(2)CA Civil Procedure Code § 874.319(a)(2) Whether partition in kind would apportion the property in such a way that the aggregate fair market value of the parcels resulting from the division would be materially less than the value of the property if it were sold as a whole, taking into account the condition under which a court-ordered sale likely would occur.
(3)CA Civil Procedure Code § 874.319(a)(3) Evidence of the collective duration of ownership or possession of the property by a cotenant and one or more predecessors in title or predecessors in possession to the cotenant who are or were relatives of the cotenant or each other.
(4)CA Civil Procedure Code § 874.319(a)(4) A cotenant’s sentimental attachment to the property, including any attachment arising because the property has ancestral or other unique or special value to the cotenant.
(5)CA Civil Procedure Code § 874.319(a)(5) The lawful use being made of the property by a cotenant and the degree to which the cotenant would be harmed if the cotenant could not continue the same use of the property.
(6)CA Civil Procedure Code § 874.319(a)(6) The degree to which the cotenants have contributed their pro rata share of the property taxes, insurance, and other expenses associated with maintaining ownership of the property or have contributed to the physical improvement, maintenance, or upkeep of the property.
(7)CA Civil Procedure Code § 874.319(a)(7) Any other relevant factor.
(b)CA Civil Procedure Code § 874.319(b) The court shall not consider any one factor in subdivision (a) to be dispositive without weighing the totality of all relevant factors and circumstances.

Section § 874.320

Explanation
If a court decides to sell a property that's owned by multiple people, they will usually try to sell it on the open market. But if selling it by auction or sealed bids would make more money and benefit all the owners, the court can choose that instead. If a sale on the open market happens, the court picks a real estate broker, or the owners can agree on one, to handle the sale. This broker must try to sell the property for at least what it's worth. If nobody offers enough money in a reasonable time, the court can approve a lower offer, re-evaluate the property’s value, or choose to sell it by auction or sealed bids instead. If someone buying the property also owns part of it, they can subtract their share from the purchase price.
(a)CA Civil Procedure Code § 874.320(a) If the court orders a sale of property, the sale shall be an open-market sale unless the court finds that a sale by sealed bids or an auction would be more economically advantageous and in the best interest of the cotenants as a group.
(b)CA Civil Procedure Code § 874.320(b) If the court orders an open-market sale and the parties, not later than 10 days after the entry of the order, agree on a real estate broker licensed in the State of California to offer the property for sale, the court shall appoint the broker and establish a reasonable commission. If the parties do not agree on a broker, the court shall appoint a disinterested real estate broker licensed in the State of California to offer the property for sale and shall establish a reasonable commission. The broker shall offer the property for sale in a commercially reasonable manner at a price no lower than the determination of value and on the terms and conditions established by the court.
(c)CA Civil Procedure Code § 874.320(c) If the broker appointed under subdivision (b) obtains within a reasonable time an offer to purchase the property for at least the determination of value, the following requirements apply:
(1)CA Civil Procedure Code § 874.320(c)(1) The broker shall comply with the reporting requirements in Section 874.321.
(2)CA Civil Procedure Code § 874.320(c)(2) The sale shall be completed in accordance with state law.
(d)CA Civil Procedure Code § 874.320(d) If the broker appointed under subdivision (b) does not obtain an offer to purchase the property for at least the determination of value within a reasonable time, the court, after a hearing, may do any of the following:
(1)CA Civil Procedure Code § 874.320(d)(1) Approve the highest outstanding offer, if any.
(2)CA Civil Procedure Code § 874.320(d)(2) Redetermine the value of the property and order that the property continue to be offered for an additional time.
(3)CA Civil Procedure Code § 874.320(d)(3) Order that the property be sold by sealed bids or at an auction.
(e)CA Civil Procedure Code § 874.320(e) If the court orders a sale by sealed bids or an auction, the court shall set terms and conditions of the sale. If the court orders an auction, the auction shall be conducted under Chapter 6 (commencing with Section 873.510).
(f)CA Civil Procedure Code § 874.320(f) If a purchaser is entitled to a share of the proceeds of the sale, the purchaser is entitled to a credit against the price in an amount equal to the purchaser’s share of the proceeds.

Section § 874.321

Explanation

If a broker is selling property on the open market, they must submit a report to the court within seven days after receiving an offer that meets or exceeds a certain value. This report must include details like the property's description, each buyer's name, the offered price, sale terms, any owner financing, payments to lienholders, broker commission details, and other relevant sales information.

(a)CA Civil Procedure Code § 874.321(a) A broker appointed to offer property for open-market sale shall file a report with the court not later than seven days after receiving an offer to purchase the property for at least the value determined under Section 874.316 or 874.320.
(b)CA Civil Procedure Code § 874.321(b) The report required by subdivision (a) shall contain the following information:
(1)CA Civil Procedure Code § 874.321(b)(1) A description of the property to be sold to each buyer.
(2)CA Civil Procedure Code § 874.321(b)(2) The name of each buyer.
(3)CA Civil Procedure Code § 874.321(b)(3) The proposed purchase price.
(4)CA Civil Procedure Code § 874.321(b)(4) The terms and conditions of the proposed sale, including the terms of any owner financing.
(5)CA Civil Procedure Code § 874.321(b)(5) The amounts to be paid to lienholders.
(6)CA Civil Procedure Code § 874.321(b)(6) A statement of contractual or other arrangements or conditions of the broker’s commission.
(7)CA Civil Procedure Code § 874.321(b)(7) Other material facts relevant to the sale.

Section § 874.321

Explanation
This law states that in a case where property is being divided (partitioned), the court can split the costs, like appraisal fees, among the parties involved. However, if a party is against the division, they shouldn't have to pay the costs unless it's fair and matches the goals of the related laws.
In an action for partition of property, the court may apportion the costs of partition, including an appraisal fee, pursuant to Section 874.040, except that the court shall not apportion the costs of partition to any party that opposes the partition unless doing so is equitable and consistent with the purposes of this chapter.

Section § 874.323

Explanation

This law changes some parts of a federal law about electronic signatures, but it does not change certain sections or allow some notices to be sent electronically.

This act modifies, limits, and supersedes the Electronic Signatures in Global and National Commerce Act (15 U.S.C. Sec. 7001 et seq.), but does not modify, limit, or supersede Section 101(c) of that act (15 U.S.C. Section 7001(c)), or authorize electronic delivery of any of the notices described in Section 103(b) of that act (15 U.S.C. Section 7003(b)).