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Can a Partition Prevent a Foreclosure?

The threat of foreclosure poses a significant challenge for homeowners facing financial hardship and particular difficulty when a co-owner may be engaged in an active partition action. Amidst this uncertainty, injunctions emerge as a potential safeguard, offering homeowners a legal avenue to protect their property rights. A request for an injunction amidst a partition action to prevent a foreclosure could provide homeowners with a with a legal tool to protect their property interests. However, courts are unlikely to entertain requests for injunctions aimed solely at delaying foreclosure proceedings, as such tactics are generally not tolerated.

Mortgages in Partition Action

A “mortgage creates a lien.”[1]Miller & Starr, General rules of lien priority, 4 Cal. Real Est. (4th ed.) § 10:99. These “[l]iens are subject to the general rule of priorities.”[2]Miller & Starr, General rules of lien priority, 4 Cal. Real Est. (4th ed.) § 10:99. Since “[e]very partition action includes a final accounting according to the principles of equity for both charges and credits upon each co-tenant’s interest,” any lien gets accounted in the partition and sale of the property.[3]Wallace v. Daley (1990) 220 Cal.App. 3d 1028, 1035.

“The plaintiff shall join as defendants in the action all persons having or claiming interests of record or actually known to the plaintiff or reasonably apparent from an inspection of the property, in the estate as to which partition is sought.”[4]California Code of Civil Procedure § 872.510. Pursuant to this statute, a mortgage company, which is a lien holder, would normally be named in the partition action.

One California court found that “[i]n an action for partition where encumbrances are of record at the commencement of the action and the lien holder is not a party to the action, the court must order such person to be made a party or it must appoint a referee to ascertain what amount if any remains unpaid; also provision is made for such lienholder to make proof before the referee and for his report to be confirmed by the court.”[5]Balkins v. Los Angeles County (1947) 81 Cal.App.2d 42, 47.

Foreclosure Procedure

A foreclosure is a legal process through which a lender, typically a mortgage lender, seeks to take ownership of a property when the borrower fails to make mortgage payments as agreed upon in the loan contract. In essence, it is the forced sale of a property by the lender to recover the outstanding balance of the loan. The process typically begins with the lender issuing a notice of default to the borrower, indicating that they have fallen behind on their payments. If the borrower does not remedy the default by bringing the payments up to date or negotiating a different arrangement with the lender, the lender can proceed with the foreclosure process. This often involves a public auction of the property, with the proceeds going towards satisfying the outstanding debt.

Forcing the Sale in a Partition Action to Defeat the Foreclosure

If a party is involved in a partition action for a property subject to impending foreclosure, an expert partition attorney may be able to leverage the benefits of the partition by sale to prevent a foreclosure. Sometimes, the mortgage is not being paid due to a co-ownership dispute. Perhaps the co-owner in possession normally paid the mortgage, but has lost their job, but still won’t agree to sell.

By filing a partition action, any co-owner can force the sale of the property. When the property is sold, the lender will be paid, thereby terminating the foreclosure action.

Injunctions in a Partition Action

An injunction is a legal remedy issued by a court that orders a person or entity to refrain from doing a specific act or to perform a certain action. In essence, it is a court order that compels or restrains someone from engaging in certain conduct. Injunctions are often sought to prevent harm or to preserve rights while legal proceedings are ongoing. There are various types of injunctions, including temporary restraining orders (TROs), preliminary injunctions, and permanent injunctions, each serving different purposes depending on the circumstances of the case.

Pursuant to California Code of Civil Procedure 872.130, a California partition statute,

the court may issue temporary restraining orders and injunctions, with or without bond, for the purpose of:

(a) Preventing waste.

(b) Protecting the property or title thereto.

(c) Restraining unlawful interference with a partition of the property ordered by the court.

Furthermore, California Code of Civil Procedure 872.130 grants the court the authority to enforce its orders, compelling cooperation among the involved parties and potentially impacting non-parties associated with the property.

Talkov Law’s Partition Attorneys Can Help

When facing disagreements on property management with a co-owner, initiating a partition action stands as a definitive legal recourse for resolving such disputes. Recognized as California’s premier partition law firm, Talkov Law boasts a dedicated team of partition attorneys. Our firm’s expertise is unparalleled, having successfully managed over 260 partition actions across the state. When the goal is to dissolve a co-ownership relationship amicably or through legal means, Talkov Law stands ready to advocate on your behalf, ensuring your rights are protected and your interests are advanced. If you’re looking to end your co-ownership dispute, contact California’s leading partition action law firm by reaching out to Talkov Law. For a free consultation, call (844) 4-TALKOV (825568) or each out online today.

References

References
1, 2 Miller & Starr, General rules of lien priority, 4 Cal. Real Est. (4th ed.) § 10:99.
3 Wallace v. Daley (1990) 220 Cal.App. 3d 1028, 1035.
4 California Code of Civil Procedure § 872.510
5 Balkins v. Los Angeles County (1947) 81 Cal.App.2d 42, 47.
About Scott Talkov

Scott Talkov is a partition lawyer in California. He founded Talkov Law Corp. after more than one decade of experience with one of the region's oldest law firms, where he served as one of the firm's partners. He has been featured on ABC 7, CNN, KCBS, and KCAL-9, and in the Los Angeles Times, the Orange County Register, the San Diego Union-Tribune, the Press-Enterprise, and in Los Angeles Lawyer Magazine. Scott has been named a Super Lawyers Rising Star for 9 consecutive years. He can be reached about new matters at info@talkovlaw.com or (844) 4-TALKOV (825568). He can also be contacted directly at scott@talkovlaw.com.

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