Legal Question in Real Estate Law in California
Co-owner not paying taxes
I am a co-owner of three properties with nine others. I have been the one in charge of getting everyone's payment and forwarding them since inheriting the property. One of the co-owners (4.76%) has failed to pay his share of property taxes for the last five years. I have paid his to avoid the taxes going into arrears. I have no current contact information. The last certified letter I sent came back to me undeliverable. He does not answer phone or email contacts I have used in the past. Is there anything I can do?
Thank you.
2 Answers from Attorneys
Re: Co-owner not paying taxes
Well, claiming adverse possession is not one of the possibilities; even if you were in possession, your possession would not be adverse.
You do not say whether you are a trustee or not, nor whether you are acting as an appointed agent of the other owners, or just as a volunteer. Also, how did this arrangement come about - by inheritance, partnership, or ? Is it income property? Profitable? Is there positive net equity or are the properties "under water?"
(I noted that you inherited your share - but did all the others inherit as well, from the same decedent?)
All of the above would affect the range of available remedies and their economics and desirability. Taking the taxes out of a co-owner's income share or deducting it from a capital account could be possible under a couple of scenarios.
An ordinary suit for damages might be a possibility. I believe this would be a suit on a quasi-contract (obligation implied in law). The suit would have to be written up thoughtfully; nothing is plain vanilla when there is a complex ownership arrangement and multiple possible parties. I think a process server could ultimately track down Mr. or Ms. 4.76%, but enforcing judgment might be difficult. Perhaps it could be enforced against the 4.76% interest in the properties.
The ultimate weapon of a discontented co-owner of real property is an action for partition. This asks a court to order the properties sold and the net proceeds divided in a fair and just manner among the former owners. Your share would include reimbursement for the taxes at the expense of the non-payer's share. Partition may be a poor choice if sale will leave no net proceeds or there is a desire to keep the property in the family. It also requires serving everyone involved, although if necessary a judge could allow service by publication (in a newspaper) if one or more owners couldn't be served otherwise.
A final thought is that the size of the dollar amounts involved will influece the practicality of various choices. If the tax bill subsidy is tens of thousands, and the properties are worth in the millions, remedies may be economical whereas it would be foolish to pay the legal costs if the amounts are one-tenth as much.
Please contact me directly with details if you'd like a further analysis (gratis).
Re: Co-owner not paying taxes
Actually, adverse possession is a possibility. Adverse does not have to be by official notice. I would have to review facts and documentation. You might do an "in rem" action for a judgment that says the remaining property owners are the owners excluding the absent 4.76% person. You can serve summons by publication if you cant find him. I have done similar actions before. You might also sue him and take your judgment out of his share of the property, but depending on the facts, adverse possession might make more sense. Let me know if you want me.
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