Written for Property Poser

This week, the Property Poser experts bring clarity to the murky issue of joint ownership for a reader who owns an undivided half-share in a property.

The reader writes that the building has two separate entrances and that his co-owner rents out “her” side. He would like to know whether he has any claim to the income generated in this manner.

There appears to be some animosity between the parties, with the partner asserting her right to his portion and demanding first option to buy at a price she offers should the reader decide to sell his share.

The reader would therefore like to know whether he could simply set the price for his portion and, consequently, what would happen should his partner refuse to pay the suggested price.

Any type of co-ownership of property can be very problematic in the absence of an agreement stipulating the rights and obligations of each owner, says Rian du Toit from DTS Attorneys in Port Elizabeth.

“In this instance, it may be necessary to point out certain realities.”

If the registration documents at the Deeds Office show that the two parties are in fact co-owners, Du Toit says this will mean that each owns an undivided half-share in the property.

“Then the property is not simply split in half, with one owner on one side and the other partner on the other.”

Strictly speaking, it could also mean that the reader may actually have a claim on the rental earned by his co-owner, as she is technically renting out a portion of his undivided half-share, says Du Toit.

“Of course, the other side of this argument is that his partner is entitled to have a say regarding what the reader does with his share of the property.”

On the other hand, it could be argued that the parties have a tacit or unwritten agreement with regard to the use of the property, says Charlotte Vermaak from Chas Everitt in PE.

“This becomes problematic, however, if a dispute develops and the parties are pressed to prove the terms of this agreement.”

Vermaak says, when it comes to selling his half-share, it does to a certain extent mean that the reader can name his price, but he cannot force the co-owner to pay it.

“In fact, an unrealistic price may just lead to more animosity. If the arrangement is no longer working, would it not be more beneficial to set a market-related price simply to be able to exit the situation?”

Should the relationship continue in this fashion, it is up to either party to approach a court for an order liquidating the “partnership”, says Vermaak.

“But this could be a costly exercise and may not bring either owner much satisfaction.”

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