Disclaimer: This article is for educational purposes and does not constitute legal advice. Always consult a qualified attorney experienced in Indiana real property law for guidance tailored to your situation.
Detailed Answer
When two or more individuals co-own real property in Indiana and cannot agree on sale timing, price, expense allocation or other logistics, state law provides several legal pathways. Indiana Code Title 32 grants co-owners remedies to force a sale or resolve financial disputes.
1. Filing an Action for Partition
Under Indiana Code § 32-17-10 (IC 32-17-10), any co-owner may petition the county court for a partition action. In this lawsuit, the court examines whether the property can be physically divided (partition in kind). If division is impractical or inequitable, the court orders a public sale (partition by sale).
• The plaintiff files a complaint naming all co-owners.
• The court examines deeds, ownership interests and any agreements.
• If the court orders a sale, it appoints a commissioner to auction the property under Indiana Code § 32-17-11 (IC 32-17-11).
2. Allocation of Costs and Proceeds
Indiana law requires sale costs—advertising, commissioner’s fees, closing costs—and outstanding liens or taxes to be paid from sale proceeds before distribution. Co-owners share net proceeds according to their ownership percentage. If one party advanced maintenance costs, property taxes or mortgage payments, the court may allow reimbursement plus interest before final distribution.
3. Buyout by a Co-Owner
Instead of forcing a sale, one co-owner can offer to purchase the other’s interest. A buyout agreement may specify price and closing terms. When parties negotiate a fair market value, they avoid court costs and delay. Both sides should obtain independent appraisals and document terms in writing.
4. Mediation or Alternative Dispute Resolution (ADR)
Courts often encourage mediation. A neutral mediator helps parties explore creative solutions: staggered sales, rental arrangements, or reimbursement schedules. Indiana Trial Rule 75 supports court-annexed mediation, which can reduce litigation time and expense.
5. Court-Appointed Receiver or Commissioner
If co-owners cannot maintain the property—oversee repairs, collect rents or pay taxes—the court may appoint a receiver. The receiver manages day-to-day operations and ensures expenses are paid. This remedy preserves value until sale or settlement.
Helpful Hints
- Document every offer, expense and communication in writing.
- Obtain an independent, certified appraisal before negotiating or filing suit.
- Consider mediation to preserve relationships and reduce costs.
- Review co-ownership agreements for buyout or dispute-resolution clauses.
- Track court deadlines closely once you file a partition complaint.
- Consult a real estate attorney early to understand procedural requirements and fees.