Options for Co-Owners When They Can’t Agree on a Buyout Price in Utah
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance tailored to your situation.
Detailed Answer
When co-owners of real property in Utah cannot agree on a buyout price, they have several paths to resolve the dispute. Utah’s partition statutes, found in Title 78B, Chapter 6 of the Utah Code, govern these options.
1. Voluntary Negotiation and Mediation
Before filing a lawsuit, co-owners can hire a neutral mediator or certified facilitator to negotiate a buyout price. Mediation often saves time, reduces legal fees, and preserves working relationships.
2. Judicial Partition in Kind
If physical division of the property is practical, a court may order a partition in kind under Utah Code §78B-6-504. This divides the land or asset into separate portions reflecting each owner’s share.
3. Judicial Partition by Sale
When dividing the property isn’t feasible, the court can order a public sale. Under Utah Code §78B-6-505, the property is sold—often at auction—and proceeds are distributed to co-owners based on their ownership interests.
4. Appointment of a Partition Commissioner
The court may appoint a neutral commissioner to manage the sale process, advertise the property, receive bids, and report the sale results back to the court. This ensures transparency and fairness.
5. Distribution of Net Proceeds
After the sale, liens, taxes, and sale costs are paid. The remaining funds—net proceeds—are divided per each owner’s share under Utah Code §78B-6-506.
Helpful Hints
- Obtain a professional real estate appraisal early to establish a market-based value.
- Keep detailed records of property expenses, improvements, and fees.
- Explore alternative dispute resolution, such as mediation or arbitration, before litigation.
- Understand that partition actions can be time-consuming and may involve court costs.
- Consult an attorney experienced in Utah property and partition law to navigate procedures.
- Review Utah Code Title 78B, Chapter 6 for deadlines and procedural requirements.
- Consider potential tax implications of a sale or buyout transaction.