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Detailed Answer
In Arkansas, co-owners of real property share carrying costs equally unless a written agreement states otherwise. Carrying costs include mortgage payments (principal and interest), property taxes, insurance premiums, maintenance and repair expenses, homeowner association dues, and utilities. One co-owner who covers more than their share may seek reimbursement through an equitable contribution action or during a partition proceeding under Arkansas Code Title 18, Chapter 60 (“Partition”).
- Identify and Document Costs: Gather statements for mortgage, taxes, insurance, maintenance, HOA dues, and utilities. Keep copies of receipts, payment records, and logs detailing dates and amounts.
- Calculate Total Carrying Costs: Sum each category of expense over the period in question. For example, if mortgage payments total $24,000 over two years, property taxes $4,000, and insurance $2,000, the total is $30,000.
- Determine Each Co-Owner’s Share: Divide the total by the number of co-owners or as agreed. For two co-owners, divide by two. In this example, each share is $15,000.
- Compute Reimbursement Amount: Subtract the paying co-owner’s share from the amount they actually paid. If one co-owner paid the full $30,000, they may recover $15,000 from the other co-owner.
- Demand Reimbursement in Writing: Send a written demand letter outlining the calculations, supporting documentation, and a deadline (e.g., 30 days). Maintain proof of delivery.
- File a Partition or Contribution Action: If the co-owner refuses to pay, you can file an action for partition and accounting in Arkansas Circuit Court. The court may order sale of the property and division of proceeds, crediting the paying co-owner’s contributions first. See Ark. Code Ann. § 18-60-514 (Sale; expenses and division of proceeds).
Arkansas courts generally allow co-tenants to recover expenses exceeding their equitable share. While Arkansas statutes do not explicitly set out “equitable contribution,” judges apply general equitable principles in partition and accounting actions (Allen v. Allen, 266 Ark. 380 (1979)).
Helpful Hints
- Keep detailed records and receipts for all carrying costs.
- Communicate clearly and in writing when requesting reimbursement.
- Review any co-ownership agreement for cost-sharing provisions.
- Consult an attorney to ensure procedural compliance in court actions.
- Understand that a partition action can both divide the property and settle expense contributions.