Fires and earthquakes in California have partially or completely destroyed community association projects, leading to partition actions that physically divide and sell off part of the project or force the sale of the entire project. This happened to projects following the 1994 Northridge Earthquake and again after the 2025 Palisades Fire. In each case, the cost to rebuild was significantly more than the insurance payout.
Judicial Partition Required
Ownership of a condominium consists of a separate interest in an airspace unit, coupled with an interest in the common areas, and membership in an association. (Villa De Las Palmas Homeowners Ass'n v. Terifaj (2004) 33 Cal.4th 73, 81) Severing those interests requires judicial action. "In a condominium project the common area is not subject to partition, except as provided in Section 4610." (Civ. Code § 4630) "[T]he Legislature's manifest intent in using the term "partition" in Civil Code section 1358 and the qualified term "judicial partition" in section 1359 is to bar partition of the complex's common areas by voluntary action, and to permit judicial partition only under the conditions described in section 1359." (14859 Moorpark Homeowner’s Ass'n v. VRT Corp. (1998) 63 Cal.App.4th 1396, 1405) A partition action allows a court to sever or terminate members' interests in the common areas. (Cummings v. Dessel (2017) 13 Cal.App.5th 589) An association's CC&Rs will often describe the steps members must take to initiate a partition action. If not, owners still have the right to bring a partition action. (Thomas v. Witte (1963) 214 Cal.App.2d 322) A partition action allows a court to determine if the association is entitled to partition, each member’s interest in the project, and the best way to partition the property.
In a partition action, the trial court determines the plaintiff's right to partition (Code Civ. Proc. § 872.710), the interests of the parties in the property (CCP § 872.610), and the manner of partition (CCP §§ 872.810-872.840). The court then issues an interlocutory judgment*. (CCP § 872.720) The court appoints a referee to divide or sell the property. (CCP §§ 873.010(a), 873.210, 873.510, 873.790) The court may also appoint a referee to determine the manner of partition. (CCP § 872.820(b)) The court then orders the proceeds of sale disbursed (CCP § 873.810) and enters a judgment of partition (CCP § 874.210).
*An interlocutory judgment is a non-final court ruling made before the final resolution of a case. It settles specific, intermediate issues.
Partition in Kind (Physical Division)
Physical division of a common interest development can be used when the division would not cause the co-owners, as a group, significant prejudice. (Code Civ. Proc. § 874.318) The association must prove to the court that the physical division is both feasible and would not cause great prejudice to members of the association. "Owelty" can be employed to equilize the distribution of value. (Code Civ. Proc. § 874.319(a)(2); Williams v. Wells Fargo Bank & Union Trust Co. (1943) 56 Cal.App.2d 645) The court will appoint a "partition referee" to assist in determining the best way to divide the property. If physical division of the project is not feasible, the court may opt for partition by sale instead. (Code Civ. Proc. § 872.820)
Partition By Sale
When a physical partition of the project is impractical or would cause substantial prejudice, a court can order the sale of the entire project and distribute the funds in accordance with each member's share of ownership. When the court in a partition action determines that the property is to be sold rather than divided, the sale is made by the partition referee appointed by the court. (Code Civ. Proc. § 873.510)
Requirements for Partition
To partition common areas, a project must meet one or more of the following conditions, per Civil Code § 4610:
(1) More than three years before the filing of the action, the condominium project was damaged or destroyed, so that a material part was rendered unfit for its prior use, and the condominium project has not been rebuilt or repaired substantially to its state before the damage or destruction.
(2) Three-fourths or more of the project is destroyed or substantially damaged, and owners of separate interests holding in the aggregate more than a 50-percent interest in the common area oppose repair or restoration of the project.
(3) The project has been in existence for more than 50 years, is obsolete and uneconomic, and owners of separate interests holding in the aggregate more than a 50-percent interest in the common area oppose repair or restoration of the project.
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