The compensation of the partition referee is paid at the end of the case, which is generally when the co-owners are being paid. In California, partition referees effectuate the court’s judgment that the property should be partitioned, which usually involves a sale of the property.
The Partition Referee Gets Paid at the End of the Case
The law is that a “referee’s compensation may be made a lien against the interests of the parties where physical property is in controversy.”[1]55 Cal. Jur. 3d Referees § 22. This is explained by California Code of Civil Procedure 874.120, which is a partition statute providing that:
(a) The costs shall be a lien on the share of the party specified.
(b) A lien imposed by this section has priority over any other lien on the share except those imposed under this section.
California Code of Civil Procedure 874.120
Empowered by California Code of Civil Procedure 873.010(a)(3), the court may “[f]ix the reasonable compensation for the services of the referee and provide for payment of the referee’s reasonable expenses.”
What is the Cost of a Partition referee?
As explained in our article on the cost of a partition referee, the general cost is around $14,000 to $25,000. When the referee is an attorney, they generally replace many of the tasks of the attorneys by requesting sale approval and generally keeping peace at the property, thereby decreasing the need for attorneys to file motions with the court or exchange communication with counsel for the co-owners.
Who Pays for the Referee?
Generally, the partition referee’s fees are split between the parties according to their ownership interests.[2]Code Civ. Proc. § 874.040 This means that a 50% owner would pay around $7,000 to $12,500. If a co-owner documents non-cooperation with the referee, those fees can be shifted entirely to the non-cooperative co-owner.
What is the Timeline for a Partition Whereby the Referee Gets Paid?
File a Partition
The first step is to file a partition complaint in the county courthouse where the property is located. While we provide a partition complaint online, it is strongly advised to seek the counsel of an experienced partition attorney before filing. Errors during the filing process can result in delays and may undermine your case, as initial pleadings can be treated as evidence, even if you intend to make amendments later on.
Referee is Appointed
When the court determines that the real property will be partitioned, the “court shall appoint a referee to divide or sell the property as ordered by the court.”[3]Code of Civil Procedure § 873.010. The court can decide if the the property will be partitioned by sale or partitioned in-kind.
Sale of Property
Under the new Partition of Real Property Act, is is likely that there is a “broker appointed to offer property for open-market sale [such that he or she will] file a report with the court no later than seven days after receiving an offer to purchase the property for at least the [court-determined] value determined….”[4]Code of Civil Procedure § 874.321. Furthermore “the referee, or any party may move the court to confirm or set aside the sale.”[5]Code of Civil Procedure § 873.720.
Court Order Directing Sales Proceeds
California Code of Civil Procedure 873.820 is the California partition statute that directs the order in which the proceeds of a sale of a property will be applied. Notably, the statute provides that “The proceeds of sale for any property sold shall be applied” to pay “(a) Payment of the expenses of sal” and “(b)Payment of the other costs of partition in whole or in part or to secure any cost of partition later allowed.” In turn, the partition statutes explain that: “The costs of partition include…The fee and expenses of the referee.“[6]Code Civ. Proc. § 874.010(b).
Talkov Law’s Attorneys Can Help
A thorough understanding of these regulations is imperative for individuals navigating the complexities of partition actions in California. Understanding the mechanisms behind the payment of the partition referee is essential for comprehending your share of the sale proceeds at the end of a partition action. An experienced partition attorney may recommend an experienced referee worth the costs. Contact California’s premier partition action law firm by reaching out to Talkov Law. For a free consultation, call (844) 4-TALKOV (825568) or reach out online today.
References
| ↑1 | 55 Cal. Jur. 3d Referees § 22. |
|---|---|
| ↑2 | Code Civ. Proc. § 874.040 |
| ↑3 | Code of Civil Procedure § 873.010. |
| ↑4 | Code of Civil Procedure § 874.321. |
| ↑5 | Code of Civil Procedure § 873.720. |
| ↑6 | Code Civ. Proc. § 874.010(b). |
