California Code of Civil Procedure 873.250 is the California partition statute that addresses owelty payments in a partition action involving partition in-kind in California. The statute provides that:
(a) Where division cannot be made equally among the parties according to their interests without prejudice to the rights of some, compensation may be required to be made by one party to another to correct the inequality.
(b) No compensation shall be required to be made to others by unknown owners or by minors unless it appears that a minor has personal property sufficient for that purpose and the minor’s interest will be promoted thereby.
California Code of Civil Procedure § 873.250
“Owelty” is a sum of money paid by one former joint tenant to another after a partition results in the unequal division of property, in order to equalize the disproportionate division of the property. Owelty is ordered by a court as part of a judgment of partition in order to compensate a prejudiced party for the inequality of partition. The term is usually, if not universally, applied to the partition of lands (i.e., partition in kind). See 48 Cal. Jur. 3d Partition § 80.
A recent decision discussing this topic is Jamison v. Jamison (2008) 164 Cal.App.4th 714.
It is important to understand that the provision for owelty of partition, however, should be distinguished from compensatory adjustments under Code of Civil Procedure § 872.140 made under the ordinary principles of equity as for accountings and allowances in a partition by sale of real property. See 48 Cal. Jur. 3d Partition § 80.
Law Revision Commission Comments to California Code of Civil Procedure § 873.250
In 1976, the California Law Revision Commission explained California Code of Civil Procedure § 873.250 as follows:
Section 873.250 continues the substance of the first sentence of former Section 792. The bar on requiring owelty of a minor applies to imposition of a lien on the share of the minor as well as to direct payment. The provision in this section for owelty of partition should be distinguished from compensatory adjustments made under the ordinary principles of equity, as for accountings, allowances, and the like, pursuant to Section 872.140.
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