What You Need to Know About Partition Proceedings

Introduction

            In Ontario, land can be co-owned in one of two ways; as either join tenants or tenants in common. In the former, each join tenant owns 100% of the land in undivided proportions. In the latter, each co-owner owns a certain percentage of the land; they can own it in equal parts or unequal parts. When there are more than two co-owners, a tenancy in common is usually used. 

If disputes arise between the co-owners under a tenancy in common, the Partition Act (the Act) is usually relied upon to guide with the resolution of such disputes. One owner may want to buy the property as a long term investment for themselves, another owner may be in the real estate business and thus may want to simply flip the property for a profit, and yet another owner may want to buy the property and rent out their portion in order to receive residual income. The Act essentially permits anyone with an interest in land in Ontario to either file (1) an action or (2) make an application to the court to have the land partitioned / sold. It is important to note that prudent co-owners usually decide to contact out the Partition Act by having one or more co-owner(s) waive their right to recourse under the Act. This article will seek to clarify the process and will give a basic understanding of Rule 66 (which is used for disputes between join tenants).

The Partition Act 

            The enforcement of the Partition Act can be complicated by many things, including but not limited to, first and second mortgages, family situations, estate planning, etc. For example, if a mortgage is involved, notice to, or consent from, the lender may be required. Also, if there is a family dispute in addition to the conflict at hand, the courts may decide to defer the partition application until the matrimonial claims get resolved. 

            Overall, for simple claims, courts will usually grant a request for a partition. That being said, it is important to note that judges usually analyze the property in question before making a determination on the matter. This is because certain properties are easier to divide as compared to others. For example, partitioning vacant land is much easier than partitioning a condominium unit. This is common sense, as partitioning vacant land will only require a surveyor to make the appropriate measurements. On the other hand, partitioning a condominium will require cooperation with the condominium corporation and any other relevant parties. Therefore, for condo units, the courts are more likely to order the sale of the unit rather than a partition. It is also important to note that the courts retain the discretion to refuse a partition and / or a sale if they find the parties (or one party) have been malicious, oppressive, and / or vexatious.

The role of Rule 66

            This rule is meant to deal with situations where, one owner of jointly owned property seeks to sell or divide land under s.2 or s.3 of the Partition Act, but the other joint owner does not want to do so. The sections of the Act mentioned above essentially state that any joint owner of real property in Ontario can compel the other owners to sell the property. Rule 66 assists in the process by providing the court the necessary procedures to follow when an owner brings such a claim. It is important to note that there are some limited exceptions to this Rule. One notable case is if the parties are involves in a family proceeding. In such a case, the Family Law Rules may govern. 

Conclusion

            Overall, partition proceedings in Ontario can arise either under the Partition Act or Rule 66, depending on whether the owner(s) that want to divide the property are under a tenancy in common, or a joint tenancy, respectively. For claims under the Act, the party will make a request, and the court will analyze the property in question, and then make a decision granting the request. Rule 66 will be involved if a claim is made under s.2 or s.3 of the Partition Act (which involves dividing land between joint tenants). Finally, it is important to remember that a partition may not always be the best course of action, as depending on the circumstances of the claim, the sale of the property may be a better solution. In conclusion, if there is a dispute as to partitioning land among co-owners under a tenancy in common, or among owners in a joint tenancy, the proper procedures should be followed if the claim is to be successful.