Dear Len & Rosie,
My sister and I inherited fifteen acres in the Sierra foothills from our parents. It’s not worth that much. There’s a small cabin there where my family stays every year. I want to keep the property in the family. The problem is that my sister wants out. She lives in North Carolina and hardly ever visits. She wants to sell the property and use her half of the money to help her son buy a home. I can’t afford to buy her out and the county won’t let us subdivide the property either. Can my sister force me to sell our family’s history?
Unlucky for you, the law is on your sister’s side. There is a long-standing legal doctrine against “restraints against alienation.” The idea is that if you own property, then you ought to be able to get rid of it. When a piece of land, such as your inheritance, is owned by two or more people, then any one owner can usually force a sale of the property in an action for partition.
In a partition action, the court will order the sale of the property unless you can somehow convince the judge that it’s in the best interest of both you and your sister not to sell the property. Good luck on that one. From what you wrote in your letter, it’s fairly clear that your sister derives little benefit from the property. Your best bet is to find some way of buying her out, or hope she does not seek the advice of a real estate attorney.
Maybe your children would be willing to chip in with you to buy out your sister. If they aren’t willing to do so, then maybe you’re the only one in the family who really wants to hold on to the property. Our advice in that case is to give up. If your sister gets a lawyer to send you a letter threatening a partition action, give up. Fighting your sister in a partition will cost you money and your relationship with her, and you’ll lose.
Your property taxes must be very low, because when your parents died, you and your sister avoided a property tax increase because of the Proposition 58 parent to child transfer reassessment exclusion. If you are able to buy out your sister, that exclusion won’t apply. Your sister’s half of the property will be reassessed to its present value.
It’s all water under the bridge now, but it may have been possible for your parents to have prevented your problems. They could have given this property to you and other assets to your sister, even if that resulted in you getting more. Or they could have left the property to a dynasty trust for the benefit of the family that prohibits the sale of the property unless everyone agrees. Transferring a property into a dynasty trust can allow you to tie up the property for generations to come. While it is too late for your parents to have done this, this is something for you to think about when it comes time to creating your own estate plan.
Len & Rosie
Dear Len & Rosie,