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Roger
Roger, Lawyer
Category: Real Estate Law
Satisfied Customers: 26917
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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Hello- I am in a business in which I and my partner are

Resolved Question:

Hello-

I am in a business in which I and my partner are co-owners of a duplex located out of the state we live in. Each of us owns 1/2 the building in our separate LLCs.
We have been trying to lease the entire building to one tenant for their employees, however, changes to the local market have created competition which has made our unit the less desirable option. I have tried to reason with my partner that we should reduce the rent to get tenants into the building, which has been sitting empty for the last 3 months. She claims that I cannot rent my half to whoever I need to--that she owns "half the roof and foundation" under my part. Since the unit is a duplex with separate entrances, can she prevent me from renting to cover my holding costs? This situation is having huge impact on my finaces and I am in danger of losing not only my investment in the project, but my personal home and assets, as well.
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Roger replied 1 year ago.
Hi - my name is XXXXX XXXXX I'm a Real Estate litigation attorney. Thanks for using JA! I'll be glad to assist.

One question - - do each of your LLC's own 1 duplex, or is the ownership 50/50 between your LLC's for the entire building?
Customer: replied 1 year ago.

We had a verbal agreement to purchase the building and bought it together. It was not spelled out that we each own 1 duplex, that we each own half of the building. I paid for my half separately with funds from my LLC, wired to the seller and she did the same. I also pay half the utilities and rent separate from my partner.

Expert:  Roger replied 1 year ago.
Ok. Thanks for the information.

If there is no written ownership interest spelled out that says 1 duplex is yours and one is your partner's, then you cannot rent one of the duplex's without consent of the other owner. This is so because each of you own a 1/2 interest in the entire building, but since there's no agreement on what 50% belongs to each, there's no legal way to say who owns what space/square footage.

In order to move on without the partner, you Joe have to file a partition lawsuit against your partner and ask the judge to divide the building equitably. The result would likely be that each of you end up with one duplex, but until a court orders it, it's just speculation.

Thus, if you can't get along with the partner or agree on how to operate, the only way to forcibly recover your interest and proceed alone is to file the partition suit.

Thanks for allowing me to assist you, and if you have any additional questions, please don't hesitate to ask.
Customer: replied 1 year ago.

There is also a problem with title to the building, which is a modular. I paid 100% of what was owed to the seller for my half of the building, plus delivery and setup fees. My partner did not have the funds to pay the remaining $4700 balance and made an agreement with the seller to pay it to when the building was rented. Then she inspected the building and found things she was not satisfied with and is using that as an excuse to not pay the remaining balance due. Because of this the seller is withholding title, which I have requested through an attorney, however the seller is not responding. So I don't even have title. Without title, can I file a petition suit? Taxes have been paid and building permits filed on the building.

Expert:  Roger replied 1 year ago.
Thanks for the information.

No, if you don't have title to the property, then you can't file a partition lawsuit. Also, as a practical matter, you can't rent it either - - because you don't own it.

One possibility is for the seller to cancel the contract based on the other buyer's failure to pay. In that case, the seller could just sell the entire place to you, or maybe work out a deal to find another buyer to go in with you. OR, the seller could file suit for specific performance, which is a request for the buyer to fulfill his/her end of the contract and pay up.

Another possibility is to see if the seller will sell you one duplex and offer the other for sale. That would get you were you want to be as well.

The main thing is that the seller has the right to cancel the contract if the buyer hasn't performed, so your best option is to try and cooperate with the seller and see if a deal can be reached between the two of you to get what you want given the breach by the other buyer.
Customer: replied 1 year ago.

It sounds like my partner needs to pay the contractor so that we can move on. A final question: the Purchase Agreement and Delivery and Setup agreements were separate agreements. My partner is claiming she does not need to pay the final payment in the Delivery and Setup agreement because she was not satisfied with the quality of the work performed. My stance is that the entire amount must be paid, and if my partner has issues with the workmanship, that must be addressed with the contractor afterwards, perhaps through a court claim. What are your thoughts? Thank you, XXXXX XXXXX your advice.

Expert:  Roger replied 1 year ago.
Yes, the simplest solution would be if your partner would pay up and allow you to move on. Maybe that will happen.

As for the workmanship claims, it is legally possible for your partner to withhold payment for the delivery and setup and demand the issues to be remedied before paying the balance. However, this agreement should not hold up the title being issued if that's a different contract.

As for the claim, in order to have a legitimate complaint, your partner would need to have specifications promised and proof of how the product delivered fails to comply with those specifications. Your partner can't likely make a successful claim that she didn't get what she expected - - instead, the claim would have to be based on actual proof that the property didn't meet the specifications.

If your partner can make this claim, it can be something addressed before closing the deal on the delivery and setup, but that should be a separate issue from the purchase.
Customer: replied 1 year ago.

Thanks, XXXXX XXXXX have proof in the form of photos and documentation of their web advertising that the product promised was not what was


delivered.


Have a great rest of your day!

Expert:  Roger replied 1 year ago.
Ok. If you didn't get what you paid for, then you certainly have legal grounds to complain and sue.

Thanks for allowing me to assist and please let me know if I can be of any further assistance.
Roger, Lawyer
Category: Real Estate Law
Satisfied Customers: 26917
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
Roger and 4 other Real Estate Law Specialists are ready to help you
Customer: replied 1 year ago.

You're most welcome.

Expert:  Roger replied 1 year ago.
Please let me know if you need anything further.

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