Unloading in the evening

Unloading in the evening

Friday, April 27, 2018

Court orders sale of farm property, rejects co-owner's request to split up the land

In Ontario, the Partition Act allows a co-owner of property to apply to the Court to break up the co-ownership.  If two or more parties own a piece of land, and one wants out, that co-owner is generally entitled either to an order dividing the property itself or, more often, an order requiring the sale of the jointly held property and the division of the proceeds.

In a recent decision of the Ontario Superior Court of Justice, two former brothers-in-law were in court disputing how their co-ownership of a 100-acre farm parcel should be ended.  The property consisted of 64 acres of agricultural land, and 36 acres of woodlot.  Brother-in-law O made the application to the Court for an order to sell the property and divide up the sale proceeds.  Brother-in-law M lived part of the year in a small house on the woodlot portion; he asked the Court to divide up the land itself.  M proposed that he receive the 36-acre woodlot along with a continuing interest in the 64-acre balance.  The 64-acre section would then be sold with O receiving the largest portion of the proceeds of sale.

As is the case in most partition applications, the Court ordered that the entire property be sold and the proceeds of sale divided between the two co-owners because the land could not be reasonably partitioned.  Firstly, the municipality would impose restrictions on the land if it was severed that would affect the value of the land.  Secondly, M's proposal would result in a forced sale by O to M, something that the Court does not have jurisdiction to grant.  Thirdly, M's proposal would compel the two co-owners to continue, at least for a time, in an "ongoing, untenable relationship".  Avoiding that situation is the purpose of the Partition Act.

The Court also ordered that O's costs of the application be payable out of M's share of the proceeds from the sale of the property.

Read the decision at:  O v. M.