Negotiating with Siblings to Avoid a Partition Action in Colorado
Disclaimer: This article is for informational purposes only and is not legal advice.
Detailed Answer
When you inherit property in Colorado with your siblings, you each own an undivided interest in the real estate. If any co-owner disagrees about how to use, manage, or sell the inherited property, that person may file a partition action in district court under Colorado law. A partition action forces either a physical division of the land or a court-ordered sale. See C.R.S. § 38-31-101 et seq.
Why Negotiate Instead of Filing for Partition?
- Costs: Court fees, legal expenses, and commissions for partition sales can be high.
- Time: Court proceedings often take months or years.
- Control: Private agreement lets you choose sale timing, price, and terms.
Steps to Negotiate and Avoid a Partition Action
- Open Communication: Hold a family meeting or video call to discuss everyone’s goals—whether to keep, sell, or rent the property.
- Get an Appraisal: Hire a licensed appraiser to establish fair market value. An objective valuation supports buyout offers or sale listings.
- Draft a Buyout Agreement: If one sibling wants sole ownership, agree on a buyout price. Use an attorney or title company to prepare a deed transfer and any payment terms.
- Agree on a Joint Sale: List the property with a real estate broker and split net proceeds according to each heir’s share.
- Consider a Co-Ownership Agreement: Create a written contract detailing expense sharing (taxes, insurance, maintenance), management duties, and exit options.
If negotiations stall, any co-owner can file for partition. Under C.R.S. § 38-31-101, the court may order partition in kind (dividing the land into separate tracts) or partition by sale (selling the entire property and distributing the proceeds). Courts often encourage mediation or settlement talks before issuing a final order.
Helpful Hints
- Document Agreements in Writing: Clear, written contracts help avoid future disputes.
- Use Mediation Early: A neutral mediator can help reach consensus and keep relationships intact.
- Know the Tax Impact: A sale or buyout can trigger capital gains taxes; consult a tax professional.
- Budget for Expenses: Plan for appraisal fees, closing costs, and attorney’s fees in any agreement.
- Record New Deeds Promptly: After a buyout or sale, record the deed with the county recorder’s office to clear title.