Two sisters who decide to move out of their parents’ home and build independent lives of their own. They agree that to have their own home they will need to pool their finances together so that they can afford a modest two-bedroom apartment conveniently located close to where they work.
As time goes by, one of the sisters who starts to see someone decides that she wants to start a family with her partner and invest in a family home. The other sister wants to hold on to the apartment as an investment and make a capital gain years later when the apartment can fetch a pretty penny. How do the sisters resolve their differing goals when they can’t agree?
An answer typically is an application to the Supreme Court for an order based on the inaptly named Partition of Property Act.
The Partition of Property Act
In British Columbia, serious co-ownership of land disputes are typically resolved in accordance with the provisions of the somewhat inaptly named Partition of Property Act. (which allows one or more co-owners of the property to apply to the Supreme Court of British Columbia for an order to force a sale (or in some limited cases, the partition) of the property. The Act states that a person who has at least a 50% interest in land is generally entitled to an order for its sale (subject to any co-ownership agreement that effectively limits that right).
To prevent any such sale, the co-owner who does not want to sell must convince the Court that there is a good reason not to. Potential reasons for not permitting or delaying a sale might include extreme hardship, a reasonably held expectation that the property would not be sold (at least for some period of time) or an actual written agreement governing the terms of ownership that provides some basis for not selling.
In ter Borg v. Morris, two enterprising young men decided to purchase real estate together in order to provide for both of them to live and to hopefully build up equity through the payment of a mortgage or increase in the market value of that property. The subject property was the second purchase by the parties under such an arrangement.
Circumstances changed when Macey ter Borg who had moved out of the property wished to sell the property. Allen Morris did not wish to sell his 50% of the property.
As the burden of proof that the sale of the property would result in hardship fell on Mr. Morris, he indicated that there were unresolved financial issues between them, among other reasons. The judge dismissed the reasons provided by Mr. Morris, stating that because Mr. Borg risked losing access to money tied up in the property, and Mr. Morris risked losing a home, these hardships were essentially the same. The property was ordered to be sold with recommended adjustments allowed for the disputed financial issues.
Implications of Using the Partition of Property Act
Resorting to a Court application pursuant to the Act is typically a last resort when co-owners can no longer agree. There are legal costs associated with such an application and a lawsuit may have an adverse effect on any remaining personal relationship between co-owners.
However, in some cases, a co-owner likely has no choice but to seek a Court ordered solution to a deadlock over land. If you are involved in such a deadlock, or simply want advice about your legal options, seek advice from experienced property law lawyers.
Contact a Trusted Property Law Lawyer
If you are involved in a dispute over property and you are seeking to either force a sale or resist an application by a co-owner to sell a property, you should contact an experienced property law lawyer for guidance. To schedule a consultation with one of our land ownership lawyers, call McLarty Wolf today at 604-687-2277 or send us an email through our online contact form.