The Fees and Costs for a Partition Case – Who Pays?

I.   WHO PAYS FOR LAWYER FEES AND COSTS IN A PARTITION ACTION?

II.   SUMMARY OF CALIFORNIA COURT DECISIONS ON WHEN YOU CAN GET ATTORNEY FEES IN A PARTITION CASE

• What are attorney’s fees incurred for the common benefit?
• California Case Law Regarding Attorney’s fees Incurred for the Common Benefit

III.   A DEEPER DIVE INTO ATTORNEY FEES IN A PARTITION CASE

IV.   HOW MUCH ARE THE FEES AND COSTS IN A PARTITION CASE?

WHO PAYS FOR LAWYER FEES AND COSTS IN A PARTITION ACTION?

By default, each party pays for their own attorney’s fees and costs in a partition action.  However, under California law, a party may be entitled to have the costs of partition paid by the other side.  The “costs of partition” include reasonable attorney’s fees incurred for the common benefit. California Code of Civil Procedure Sections (CCP) 873.820, 874.010.

California Partition Law allows a court to divide attorney’s fees based on ownership interests or based on equity.  California Code of Civil Procedure 872.140 provides that the “The court may, in all cases, order allowance, accounting, contribution, or other compensatory adjustment among the parties according to the principles of equity.”  This means that, while the default is to split the proceeds of the sale according to ownership interest, the money paid out may adjusted in any way that the court determines is equitable, i.e. fair.

California Code of Civil Procedure Section 874.010 states that costs of partition include:

• Reasonable attorney’s fees incurred or paid by a party for the common benefit.
• The fee and expenses of the referee.
• The compensation provided by contract for services of a surveyor or other person employed by the referee in the action.
• The reasonable costs of a title report procured pursuant to Section 872.220 with interest thereon at the legal rate from the time of payment or, if paid before commencement of the action, from the time of commencement of the action.

California Code of Civil Procedure Section 874.020 states:

The costs of partition include reasonable expenses, including attorney’s fees, necessarily incurred by a party for the common benefit in prosecuting or defending other actions or other proceedings for the protection, confirmation, or perfection of title setting the boundaries, or making a survey of the property, with interest thereon at the legal rate from the time of making the expenditures.”

CCP Section 874.040 also discusses the “costs of partition” stating that they should be apportioned between the parties in proportion to their interests or as may be equitable

SUMMARY OF CALIFORNIA COURT DECISIONS ON WHEN YOU CAN GET ATTORNEY FEES IN A PARTITION CASE

What are attorney’s fees incurred for the common benefit?

California Partition Law allows for side to be awarded attorney’s fees, or part of their attorney’s fees, based on equity (fairness). In other words, a party may be entitled to its attorney’s fees if the Court finds that it is fair to do so.

The purpose of the law regarding attorney’s fees in partition cases “was to place the burden of the expense for services of counsel upon those parties sharing in the benefits realized from such services, and that burden is specifically placed upon the parties ‘entitled to share in the lands divided,’ that is, the owners.” (Stewart v. Abernathy (1944) 62 Cal.App.2d 429, 431–432; see Capuccio v. Caire (1932) 215 Cal. 518, 525.)

While the law in this area has a lot of nuances, one thing that is clear is that trial courts have a lot of discretion in apportioning fees.  The Trial Court also has significant leeway in determining the reasonable value of work performed for the common benefit.  As one Appellate Court explained, “The record shows numerous pleadings and court appearances. Under those circumstances, it was within the province of the trial court to make its own evaluation of the value of that work. We cannot say that the awards made were improper.”  Stutz v. Davis (1981) 122 Cal.App.3d 1, 5 [175 Cal.Rptr. 701].

California Case Law Regarding Attorney’s fees Incurred for the Common Benefit

Here are some examples of California Appellate Court Decisions related to attorney’s fees in partition claims:

• A trial court may deny reimbursement of attorney’s fees under CCP § 874.010 as not being for the “common benefit”
• A trial court may deny reimbursement of attorney’s fees under CCP § 874.040 under principles of equity
• A party may not be allowed reimbursement for attorney’s fees that are incurred in connection with the real property at issue prior to asserting a partition claim
• A trial court may deny costs as unreasonable, unnecessary, or incurred solely for the benefit of the party seeking reimbursement
• A California Appellate Court found that fees were incurred for the common benefit where a party arguing against the fee award had advocated meritless arguments which caused the other side to incur such fees
• When multiple claims are involved, an award of attorney’s fees incurred pursuing all claims may be granted where the claims are inextricably intertwined

A DEEPER DIVE INTO ATTORNEY FEES IN A PARTITION CASE

• In Gentino v. Yaghoobia (2023), involving a property in Long Beach, the defendant won, with the Court finding that Plaintiff did not have a 50% interest in the property as claimed. The Defendant moved for attorney’s fees, but was denied, with the California Appellate Court (in an unpublished decision) upholding the lower court’s finding that the Defendant’s attorneys’ fees were not incurred for the common benefit, and thus were not to be given under the partition law. It is important to understand that Appellate Courts review a Trial Court’s findings in this context based on an “abuse of discretion” standard – in other words, the Appellate Court does not decide whether the fees were incurred for the common benefit –instead, the Appellate Court just decided whether the lower court abused its discretion in making the finding.
• Nielson v. Courtney (2023) involved a property in Newbury Park, Ventura County that was owned by a couple for 16 years. The Trial Court found that both sides were contentious, a “consequence of their ‘toxic relationship,’ one akin to ‘two scorpions in a bottle’” and that because of this, the attorneys on both sides were necessary as the ex-couple “would never have accomplished a partition sale by themselves.” The Trial Court further found that it was impossible to determine which side refused to cooperate, as both side went back and forth. As noted above, Appellate Courts do not decide whether the fees were incurred for the common benefit –instead, they simply look over and decide whether the lower court (i.e. the Trial Court) abused its discretion (meaning, the ruling was clearly unreasonable, arbitrary, or erroneous).
• DeMartini v. DeMartini (2022) involved a mixed-use property in Grass Valley, Nevada County that was inherited and owned by siblings and their spouses. The trial court awarded $790,967 in attorney’s fees and environmental clean-up costs related to the remediation of the property. The Appellate Court upheld the award, finding no abuse of discretion, demonstrating the leeway a lower court has in apportioning costs under California Partition Law. Since the Department of Toxic Substances Control had apparently required certain clean-up, the Appellate Court found that it “appears to be a prerequisite for the sale of the Property, [and as such] it is difficult to imagine how money spent towards achieving such remediation could be understood as being for anything other than the common benefit.”
• Thornber v. Colby (2022) involved a single-family residence in Rocklin, Placer County. The Court found that Defendant took meritless positions in the case, including unsuccessfully filing a demurrer and cross-complaint, and dragging out a trial with redundant testimony and irrelevant requests, all centered around contesting the authenticity and validity of the deed. The trial Court ordered $60,000 in attorney’s fees apportioned equally amongst the parties in relation to their interests, and the Appellate Court, in an unpublished decision, affirmed.
• In Lin v. Jeng (2012), the Court found that plaintiff sought to prevent siblings from obtaining interests to which they were entitled, claimed an interest she was clearly not entitled to, and “created unnecessary procedural hurdles” and, as such, it was equitable to require her to bear her own attorney’s fees.
• In a published opinion, the Appellate Court in Orien v. Lutz (2017) found that “fees incurred by a defendant to a partition action [can] be for the common benefit, and therefore allocable in part to the plaintiff, despite the fact that the defendant had ‘resisted partition. ” (citing Riley v. Turpin (1960)). The Court further found that even when fees are incurred in arguing over disputes as to shares and interests, they can be for the common benefit. The Court held that “[T]he ‘common benefit’ in a partition action is the proper distribution of the “respective shares and interests in said property by the ultimate judgment of the court.”
• After the Appellate Court in Orien v. Lutz remanded the matter back to the trial court to apportion attorney’s fees under the Partition Code, the trial court determined that each of the 3 parties should have to pay 1/3 of the total attorneys’ fees. The trial court also stood by its earlier decision to cut the requested attorney’s fees of the plaintiff from $108,934 to $81,700.50. Each party was responsible for 1/3 of this amount. Each party was also 1/3 responsible for the reasonable attorney’s fees of the two Defendants, which was $98,499.00 total.
• Forrest v. Elam (1979). Attorneys fees can be awarded to a defendant when their lawyers “performed services for the common benefit of the parties by resistance to the efforts of [the plaintiff] to take . . . value to which he was not entitled”. The Court stated that because a partition action “action was contested [is] no bar to the proportional allocation of attorney fees.” The Court also found that where plaintiff incurred fees based on meritless or unfounded claims to interests they were not entitled to, these fees were not for the common benefit.
• In Riley v. Turpin (1960), under the former partition statute, the Court found that fees incurred by a Defendant could be for the common benefit even where the Defendant “resisted partition, with the claim that plaintiff had no interest in the subject property, that it belonged to defendant alone, and that plaintiff was a mere volunteer in paying the delinquent taxes.”
• In Capuccio v. Caire (1932), the Court found (under the predecessor partition statute) that “counsel fees may be allowed … for services rendered for the common benefit even in contested partition suits.” The Court made clear that fees and costs may still be for the “common benefit” even though they have been incurred in matters “controversial in nature.” Litigation ceases to be for the common benefit if it “‘arises between some of the parties only,’” or when a party seeks to deny any benefit to the other parties. See also, Williams v. Miranda (1958).

Trial Courts Have Broad Discretion in Awarding and Apportioning Fees and Costs

In the context of awards of attorneys fees per the California Partition Statutes, Appellate Courts only review whether the lower court’s ruling was justified by the evidence or the law.  Indeed, as the Appellate Court in Lin v. Jeng stated “When a trial court makes a ruling based upon equitable considerations, the abuse of discretion standard applies on review of that ruling”. Apportionment of attorney’s fees in partition cases is an equitable matter. However, if attorney’s fees are awarded per contract or settlement agreement, and there is not extrinsic evidence, an Appellate Court will review de novo, meaning “from the beginning” – that is, the Appellate Court will review the contract itself and make its own determination of whether a party was entitled to attorney’s fees under California Civil Code 1717, or not.  The Appellate Court rulings in the context of apportionment of attorneys fees would likely apply to referee and broker fees, and costs.

Equitable Partition Statutes v. Enforcement of Contract to Partition Property

In Orien v. Lutz, the Plaintiff unsuccessfully argued that the Trial Court’s award of attorney’s fees was based on a settlement contract, with the Appellate Court finding that the Settlement Agreement did not provide the basis for a partition action—rather, the Appellate Court held, the right to file a partition action is a statutory right, and the Settlement Agreement simply clarified that the parties were not waiving their right. As such, the Court found that the award of attorney’s fees wasn’t based on successfully enforcing the agreement under Civil Code 1717, but rather was based on the equitable partition statutes, and thus subject to apportionment.

HOW MUCH ARE THE FEES AND COSTS IN A PARTITION CASE?

Attorneys Fees in a Partition Case

The fees and costs in a partition matter will vary depending on the complexity of the case.  If your case is a straightforward partition case, the only claim being brought is for partition of the property, there is no dispute as to ownership interests, and no objection to partition by sale, the attorneys fees may be around $8,000, or even less if a quick settlement is obtained.  The most significant factor in determining how much the fees will be in this type of case is the extent to which the other party or parties fight the case.  Other factors include whether or not the ownership interest is in dispute, whether or not there are tenants on the property, and whether or not occupants (tenants or owners) refuse to leave.  If the other side tries to delay each step, and files unnecessary and/or voluminous paperwork with the court, the fees and costs can easily go up.  The average attorneys fees in a partition action range from $10,000 to $25,000.

However, if you have a claim for partition plus other claims (such as fraud, breach of contract, dissolution of business), the fees may fall in the range above, but could very well be higher.   Ultimately, these other claims have a wide range of time that they may take, and the total cost depends on how much time, which can be highly unpredictable.  There are a variety of factors that can determine how much fees and costs are in these cases, including, the amount of fighting the other side does, the specific court room and judge the case is assigned to, and the depositions and discovery needed.  A straightforward partition case, where the interests of the parties, are not in dispute, will not require any discovery, and thus the fees and costs are more predictable.  ANAND LAW can guide you through this process with expertise and knowledge of the law, and the experience with having handled cases involving a variety of types of property, and a variety of types of disputes (ex-spouses, boyfriend and girlfriend, siblings and other inheritance co-owner, other family disputes, business disputes over rental and income properties).

Other Fees and Costs in a Partition Case

Other fees that arise in a partition case are for brokers to sell the property, and referees appointed to oversee the sale of the property.  It behooves parties to cooperate with the sale of a property to limit fees and costs, but unfortunately, it is often the case that one side simply won’t budge.  Absent a settlement, the California Code of Civil Procedure requires the appointment of a Referee to partition the property (whether by sale or by division).  Brokers are also utilized to sell the property.  Referees fees and costs include time  in managing the property, including removing tenants, issuing required sale notices, and performing accounting and evaluation of claims.  Referee fees and costs can also have a wide range, depending on the nature of the case.  They typically range from $14,000 to $28,000, but again, will vary depending on the amount of work required.  Brokers fees customarily range from 5-6% of the total sale price.

EXTENSIVE EXPERIENCE & EXPERTISE

We have counseled and represented parties in connection with real property ranging in value from $300,000 to $25,000,000, including residential, commercial, mixed use, vacant land, multi-family, industrial, and apartments. ANAND LAW has successfully represented parties in property cases between spouses, boyfriend and girlfriend, siblings, and business partners. We have the experience and dedication to create the best plan of action for your particular situation. ANAND LAW is a partition lawyer that can end your co-ownership expeditiously and ensure that you get every penny you are entitled to.

See more:

   Partition Law Past and Present: The Partition of Real Property Act and its Predecessor The Uniform Partition of Heirs Property Act

   What is a Partition Referee?

   Distribution of Proceeds from a Partition Sale: Expenses, Costs, Fees, Liens…and Adjustments Based on Equitable Considerations

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ANAND LAW is composed of partition lawyers, accountants, and real estate brokers.  We represent parties in partition cases where we resolve co-ownership disputes throughout California, from San Diego to Sacramento, and beyond–including in the cities and areas of Los Angeles, Pasadena, Arcadia, Burbank, La Canada Flintridge, Covina, West Covina, Downey, Santa Monica, Glendale, Eagle Rock, Hollywood, Atwater Village, Echo Park, Glassell Park, Loz Feliz, Silverlake, Highland Park, Boyle Heights, Hancock Park, Cheviot Hills, Koreatown, Miracle Mile, Mid City, Venice, Van Nuys, Encino, Studio City, Sherman Oaks, Panorama City, North Hills, West Hills, Thousand Oaks, Calabasas, Granada Hills, Long Beach, Glendora, Anaheim, Inglewood, Santa Ana, Beverly Hills, Pomona, Marina Del Rey, Playa Del Rey, Mar Vista, Culver City, Cheviot Hills, Holmby Hills, Westchester, El Segundo, Hermosa Beach, Redondo Beach, Manhattan Beach, Huntington Beach, Orange, Irvine, Costa Mesa, Newport Beach, Moorpark, Fresno, Stockton, San Francisco, Berkeley, Oakland, Petaluma, Marin, Sausalito, Mill Valley, Tiburon, Daly City, Fremont, Stinson Beach, Redwood City, Berkeley, San Leandro, Napa, Santa Rosa, Costa Mesa, Huntington Beach, Santa Ana, Laguna Beach, Laguna Nigel, San Clemente, Ladera Ranch, Tustin, Lake Forest, Mission Viejo, Coto De Caza, Rancho Santa Margarita, Laguna Hills, Corona Del Mar, Carlsbad, La Jolla, Encinitas, Vista, Del Mar, Chula Vista, and communities throughout Los Angeles, Orange, Santa Barbara, Riverside, San Bernardino, San Luis Obispo, San Diego, Ventura, San Francisco, Alameda, and Mendocino Counties.

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