Whether it is chosen or imposed by circumstances, undivided ownership is a way of managing assets that must be mastered in order to fully benefit from it and avoid its drawbacks.
There is undivided ownership when the same property is owned by several people (undivided co-owners, co-individuals or undivided owners). In the context of a succession, indivision corresponds to a transitory situation preceding the partition of the property. But undivided ownership can also result from a choice: that of buying the same property together. In both cases, it must be handled with care because its mechanism is not as simple as it seems.
We share everything
The purpose of undivided ownership is to manage and enjoy the property together. Each undivided co-owner must participate in the payment of the debts concerning the property. His contribution is proportional to the share held. In case of damage or deterioration of the undivided property, all the undivided co-owners are in principle responsible. However, if the damage or deterioration is due to the negligence or fault of one of the undivided co-owners, he or she will be held responsible and liable. The undivided co-owners have a right to use and enjoy the undivided property. Except when it is decided that one of them will have the exclusive use and enjoyment of the property. In this case, he is in principle liable for an occupation indemnity towards the other undivided co-owners.
The undivided ownership agreement
A poorly organized undivided ownership can be a source of conflict and blockage. To prevent this type of situation, it is advisable to draw up a joint ownership agreement. This contract can, for example, organize the use and enjoyment of the property, provide for specific rules of distribution and reimbursement of expenses... The duration of the agreement can be determined (without exceeding 5 years) or indefinite (it lasts as long as the partition does not take place). The undivided property agreement must be drawn up by a notary if it concerns real estate.
Decisions that require unanimity
Different majority rules apply depending on the type of act. For everything concerning the conservation of the property (replacement of the boiler, repair of the roof...), the decision can be taken by a single undivided co-owner, without the agreement of the others.
For the acts of administration (sale of furniture, payment of the debts of the undivided ownership, renewal of a lease of dwelling...), the majority of two thirds is enough. Finally, for acts of disposal (sale of the property...), the unanimous vote of the undivided co-owners is essential.
Appointing a manager
The law allows the undivided co-owners to appoint a manager through the undivided co-ownership agreement. Whether it is a joint owner or a third party, the manager's mission is to represent the joint ownership, to pay the bills, to decide on repairs... At least once a year, the manager must report to the joint ownership. He engages his responsibility in case of mismanagement.
Put an end to it by remaining on good terms
The Civil Code provides that "no one can be forced to remain in joint ownership". This means that each co-owner has the right to leave the indivision whenever he wants. Thus, only one of the heirs is free to decide to sell his share of the property, even to a person "outside" the indivision. He must inform the others in writing, specifying the terms of the transfer (in particular the price, the identity of the third party...). The other undivided co-owners have priority to acquire the property over the third parties. If, on the other hand, no agreement on the principle, on the terms of the sale or the sharing is possible, the undivided co-owners must then refer the matter to the court and ask the judge for a judicial sharing.
In the simplest case, the judge will order the partition and the heirs will be referred to the notary. However, if no agreement is possible, it will end up in a judicial partition with a drawing of lots (when it is possible to do so), or even the sale of the property by auction in inextricable situations. Before it comes to that, mediation can unblock the situationamicably and defuse conflicts. Notaries are well placed to help achieve this!
Marie Christine MENOIRE