Expert: Sue Bernstein - 11/14/2005

Question
Hi this might not be something you know about but I'm desperate for the opinion of someone in the business...  THANK YOU!
In July 2004, my wife and her brother's wife both qualified to purchase a duplex in the L.A. area. The property was sold to them at $365,000. My wife's father put a down payment of $36,000.  My wife and I moved into 1 home, and her parents lived in the other. My wife's brother conveniently added himself to the title of the house, so now there are 3 people on the title: Him and his wife, and my wife. The mortgage payment started out at $1,338 and is now $1,438.  My wife and I have paid $1,100 per month while her father paid the rest. Meanwhile, her brother and her sister-in-law have only paid 50% of the taxes due on the house.  Finally, my wife and I invested about $25,000 for remodeling the house we live in.  The property is now valued at about $465,000, while the remaining balance on the loan is at $324,000.  The reason I am requiring more information is to find out where we stand in all this because my wife's brother is threatening to take us to court to sell the houses so that he and his wife can make a huge profit on property he did not put much money on (he claims they would keep two-thirds of the profit).  What kind of legal recourses do we have? And do we have a case so that he does not get that much since he did not invest much?  

Answer
Dear Raul,

A lot depends on how you took title and if any of the agreements were in writing. If the property was puchased as joint tenants then you all own 100% interest in the property.  Did you sign a quit claim deed relinquishing any interest you might have? If not, you also have an interest in the property as a spouse. I don't think he can take you to court to force you to sell but you really should direct this to an attorney on this site. One party cannot sell without permission from other owners. Make sure it is a California atty. If he can't force a sale his only other option is to try and buy you out. If it should end up in court be sure you have written proof of who paid what because that should have a bearing on how the profit is decided. Everyone should be able to get credit for what they invested before the profits are split up.
In the future never go into a partnership on property without all these things decided in advance and in writing.

Good luck.

Sue Bernstein