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Joint Ownership of Property and Failed Relationships

Joint ownership of immovable and/or movable property may be found in various forms, such as commercial partnerships, or situations where two people in a relationship jointly buy property.

It is a sad reality of life that these partnerships, whichever form they may take, do not always work out, and very often the relationship between the parties deteriorates to the extent where co-ownership of the property is untenable.

In certain circumstances, division of the property is impractical, and a solution would be that one party buys back the other party’s share, alternatively the property is sold and the proceeds divided between the parties.

If however, one or more of the parties are unwilling to sell the property, and are also unwilling and/or unable to purchase the other party’s share in the property, a stalemate is reached, as both parties’ consent is required in order to sell the property, especially in the case of immovable property.

Luckily this does not have to be the end of the matter, as our law provides a solution to the problem, namely the actio communi dividundo, which caters for the sale of jointly owned property where the relationship between parties has deteriorated, or when one party is unwilling to sell his share of the property.

The procedure takes the form of an Application to Court, wherein the Applicant asks for the property to be sold and the proceeds divided, alternatively offers to sell his/her share to the co-owner, alternatively offers to buy the Respondent’s share of the property at a reasonable market related price.

Much like with divorces, the reason for the deterioration of the partnership does not play a vital role, and our courts take cognisance of the fact that two or more people, who are unwilling to work together, can and should not be forced to do so if it would lead to further conflict.

Parties planning to buy property together with someone else may want to consider a formal written partnership agreement dealing with the division of the asset in circumstances where one or more of them are unwilling and/or unable to continue with the partnership.

This article was first published on Property24.

For legal assistance or more information, please contact:

Henno Bothma  |  Litigation and Corporate-Commercial Department  |   Abrahams & Gross Attorneys

t.   021 422 1323    |  e.  hennob@abgross.co.za info@abgross.co.za

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