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Apportioning Expenses and Benefits Upon Partition

By Stewart E. Sterk
October 28, 2009

When real property is held by two or more owners as tenants in common, joint tenants, or tenants by the entirety, termination of the cotenancy all too frequently generates litigation about the terms of the termination. Often, the issue is whether the jointly owned property should be partitioned in kind or by sale, but even when the parties agree to sell the property, the same animosity that led to the need for termination generates conflict about how the sale proceeds should be divided. In one recent case, Brady v. Varrone, NYLJ 8/24/09, p. 29., col. 2, the Second Department faced a recurring issue: In a partition action, how much credit should a co-tenant make for expenditures incurred in connection with the jointly owned property?

Brady applies the general rule that a co-tenant who pays more than her proportionate share of expenses attributable to the jointly owned property is entitled to a credit against the sale proceeds payable to other cotenants. In Brady itself, a tenant in common with a one-third share of the property had made one-half of the mortgage payments. The court concluded that the referee had correctly allowed a credit for excess mortgage payments.

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