When co-owners of property in Tennessee disagree about its management or disposition, a partition suit may be their best recourse. This legal process, though complex, is designed to ensure a fair and equitable resolution for all parties involved.

In this blog, we’ll delve into the nuances of partition suits in Tennessee, focusing on the two primary types: partition in kind and partition by sale, highlight the recent legislative changes regarding selling through a realtor, and describe how an experienced civil lawyer can help you negotiate the process.

Partition in Kind vs Partition by Sale

When delving into partition suits in Tennessee, it’s essential to understand the two primary methods of resolving property disputes among co-owners: partition by kind and partition by sale. Each approach offers a unique path to resolution and is tailored to the nature and circumstances of the property involved.

What Is Partition in Kind?

Partition in kind, also known as actual partition, involves physically dividing the property among the co-owners. This option is required by law when the property can be divided into separate parcels that are of equal value.  It’s often suitable for large tracts of land split into smaller, distinct parcels.

  • Advantages: It allows co-owners to retain a portion of the property, which can be particularly important if the property has sentimental value or the owners wish to continue using the land.
  • Challenges: The difficulty can arise in ensuring that each portion is of equal value, and in some cases, it might not be practical or possible to divide the property physically (e.g., a single-family home).

What Is Partition by Sale?

In cases where partition in kind is not feasible, usually due to the nature of the property or a partition by sale can occur instead. This process involves selling the property and dividing the proceeds among the co-owners according to their respective shares. Traditionally, this sale has been conducted through a public auction. However, there is a recent change in the law that in cases where the property was inherited it can be sold by a realtor for fair market value as discussed below.

This method is commonly used for properties that cannot be physically divided, such as a house, or when co-owners cannot agree on a fair division.

  • Advantages: It provides a clean break for co-owners and is a practical solution when physical division is impossible or impractical.
  • Challenges: The downside is that it may force owners to relinquish the property against their wishes, and the sale may not always yield the best financial return, especially in a forced or rushed auction scenario.

What Happens at an Auction for a Property Involved in a Partition Suit?

Several steps and procedures are typically followed when a property in a partition suit is sold at auction. Here’s an overview of what happens:

  • Public Auction: The auction itself is usually a public event. Interested buyers gather at the designated time and place, such as at the property location, a courthouse, or another public venue.
  • Sale to the Highest Bidder: The property is sold to the highest bidder. The winning bidder usually must pay a deposit immediately of 10%, with the remainder due after the Court approves the sale.
  • Confirmation by the Court: After the auction, the sale is subject to confirmation by the court. This means that the court reviews the sale to ensure it was conducted in accordance with the law.
  • Distribution of Proceeds: Once the court confirms the sale, the proceeds from the auction are used to pay any debts or liens against the property. The remaining funds are then divided among the co-owners according to their respective interests in the property, as determined by the court.
  • Transfer of Title: Finally, the title to the property is transferred to the winning bidder, and the sale is completed.

New Statute: Selling Through a Realtor

A recent significant update to Tennessee law allows for an alternative to the public auction process in partition-by-sale cases.

Under the new statute, the court can order the sale of the property through a licensed real estate broker instead of an auction, potentially leading to a higher selling price and a more streamlined process.  However, this only applies to real estate that has been inherited.

This option is particularly advantageous for properties that would benefit from a traditional real estate market exposure, allowing for better marketing and reaching a wider pool of potential buyers.

How Can a Lawyer Help with a Partition Suit?

A lawyer can be beneficial in a partition suit in Tennessee in several ways:

  • Understanding Legal Requirements: They can help you understand the legal requirements of a partition suit in Tennessee, including the necessary grounds for filing such a lawsuit and the specific state laws that apply.
  • Filing the Suit: Lawyers can assist in drafting and filing the complaint for partition, ensuring it meets all legal standards and is filed in the appropriate court.
  • Representing in Court: They represent your interests in court, advocating on your behalf throughout the legal process. This includes arguing the case, presenting evidence, and negotiating with other parties.
  • Negotiating Settlements: Often, partition suits can be settled out of court. A lawyer can negotiate with the other property owners to reach a mutually agreeable settlement, possibly avoiding the need for a trial.
  • Handling the Partition Process: If the court decides to partition the property, a lawyer can oversee the process, whether it’s a partition in kind (dividing the property) or a partition by sale (selling the property and dividing the proceeds).
  • Protecting Your Rights: A lawyer ensures that your rights are protected throughout the process and that you receive a fair share of the property or its value.
  • Dealing with Complexities: A lawyer can navigate challenges effectively if there are any complications, like disputes over property value or disagreements among co-owners.

Contact Us for Assistance with Your Partition Suit

Partition suits in Tennessee offer a legal solution to co-owners seeking to resolve their shared property disputes. Understanding the difference between partition in kind and partition by sale, and the recent legal developments allowing for sales through realtors, is crucial.

If you find yourself in a situation where a partition suit might be necessary, our Tennessee civil law attorneys are here to help. We can walk you through each step and help you reach a favorable outcome at the end of this complex process. Contact us today for a free consultation.