Termination of co-ownership of real estate in Hawaii

There are times when co-owners of real estate in Hawaii are involved in a dispute and no longer wish to continue co-ownership of said property, or one party is no longer making mortgage payments and the paying party wants to dispose of the property. paying party of the title. The question that usually follows is what are the options of the co-owners if they want to break this relationship.

In the event that there is no prior written agreement between the co-owners that establishes the obligations of each owner and the procedures for resolving disputes, the co-owners basically have two options:

(1) reach an agreement to resolve the dispute or

(2) terminate the co-owner relationship through a court-supervised partition action pursuant to Chapter 668, Hawaii Revised Statutes (Hawaii Real Estate Partition Statute).

The co-owners must first try to resolve their differences and come to some compromise. By reaching such a compromise, the co-owners would not need a partition action in Hawaii, which can be a very expensive process. However, if pursuing such an agreement proves to be a dead end, then a partition action from Hawaii is necessary.

In a Hawaii partition action, one or more of the owners files a lawsuit against the remaining owners. The party bringing the lawsuit must also join as a party all persons who have or claim to have any legal or equitable right, title or interest in the property described in the lawsuit.

Once a Hawaii partition action is filed, the court has jurisdiction to divide the real property by (1) partition in kind or (2) partition by sale. A “partition in kind” occurs when the court physically divides the property and each owner ends up controlling an individual portion of the property. A “sale partition” is achieved by selling the entire property at public auction and dividing the proceeds among the owners according to their respective interests in the property.

The courts tend to favor a partition in kind first, but if such a partition is not feasible, then the court will proceed with a partition by sale. As you can see, ending a real estate co-ownership relationship is not that simple and can be expensive. Therefore, you should seek a consultation with a Hawaii attorney experienced in resolving Hawaii real estate co-ownership disputes.

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