Legal Question in Real Estate Law in California

Real property interests are of several types. Some, like easements, can be abandoned. The California Supreme Court has held, however, that interests that amount to a fee or portion of the fee title cannot be abandoned. Sure, they may be lost by adverse possession or tax sale, but not by abandonment. (See, however, the recently (1982) enacted "Marketable Record Title Act" which causes certain interests in real property to "expire" under certain conditions, Civil Code sections 880.020 et seq.).

In your case, the interest of the co-owner is alive and well, and not subject to adverse possession. However, the facts you've given show that you have some substantial rights that, if cleverly enforced against the departed co-owner, could result in your being granted full ownership and/or forcing a sale whereby you could recoup your "excess" outlays for the mortgage, property taxes, insurance, repairs, etc.

First, the usual exit strategy for an unhappy co-owner of property is to bring a special kind of lawsuit called a "partition action" to ask the court to order a sale and a fair division of the net proceeds. Such a suit is brought in the county where the property is situated. Partition actions can be long and expensive, but often the defendant will settle out of court by allowing himself to be bought out or agreeing to a private sale of the property. In a full or partial out of court settlement, the parties may agree to let an arbitrator divide the proceeds of sale. Partition sales are usually done by ordinary commercial means, through listing the property with a broker, rather than a foreclosure-style auction. Dividing the net proceeds "fairly" will include reimbursement of the excess one co-owner may have paid for the costs mentioned.

Your facts also reveal that you are probably the full, 100% owner of the property, despite the way title is held, under the equitable principle of "purchase-money resulting trust," which says equitable title to property is held in proportion to the source of the purchase money, despite the way title is shown at the recorder's office (so-called "legal title," which is distinuished from "equitable title" or "beneficial ownership" or similar terms). The person who got a larger share of legal title than he would presumably be entitled to based on the portion of the purchase price he paid is considered to hold the excess ownership as trustee of an involuntary trust for the benefit of the person who put up the extra money. If you paid 100% of the down payment but the other person ended up with 50% of legal title, you MAY be able to assert that you are the beneficiary of a resulting trust and that the other person must convey his share to you upon demand.

Asserting such an interest is done by way of a quiet-title lawsuit. The other party may defend successfully, inter alia, by showing that the excess money you put up was intended to be a gift. A gift is presumed if there is a close relationship, such as father-son, but even then the presumption can be overturned by facts showing no gift was intended. Cases where the parties were husband and wife are divided about 50-50 on the gift defense. Boyfriend-girlfriend cases are less likely to have a "gift" presumption or defense that has to be debunked by the plaintiff. Facts showing the intent of the parties at the time of the purchase will be relevant to a "gift" defense. If there is no presumption of a gift, or you can rebut the presumption, you'll win and get full ownership.

Please feel free to contact me privately for a free discussion of your situation.

Your allegations may be the basis for a lawsuit among the 'owners' to determine what rights and remedies they are each entitled to. There is no 'magic wand' anyone can waive and make the problem go away. These kinds of unwritten deals frequently make for ugly and expensive litigation. If you're serious about getting counsel to deal with this, feel free to contact me.