Estate Planning

Partition and Sale

By Hull and Hull LLP

Partition and sale can become an issue in an estates context when the family cottage or other real property is gifted to the testator's children as joint tenants or tenants in common and some of the siblings wish to be bought out of their interest.

Pursuant to the Partition Act, an application may be made to the Ontario Superior Court of Justice by anyone who has an interest in land. Where the land is held by joint tenancy or tenancy in common by reason of a devise or an intestacy, an application cannot be made until one year after the death of the testator or person dying intestate who owned the land.  (See Partition Act, s. 3(2)).

Joint owners have a prima facie right to partition and sale but the Court has jurisdiction to refuse such an order.   In particular, the Court has discretion to refuse partition and sale where there has been malicious, vexatious or oppressive conduct by the party seeking an order to partition. The Court does not have jurisdiction to order one joint owner to sell to another i.e. force a right of first refusal. (See Osborne v. Myette, 2004 CanLII 7051 (ON S.C.))
 

Sharon Davis

Full post as published by Toronto Estate Law Blog on October 18, 2010 (boomark / email).