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Partition of Real Estate; or, Breaking Up Is (Not) Hard to Do

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  • Miceli, Thomas J
  • Sirmans, C F

Abstract

Under the common law, joint owners of real estate have the right to seek partition, or physical division, of the land. However, modern statutes also allow courts to order a sale of the land, with proportionate division of the proceeds, if the loss from division is substantial. Although forced sale can be beneficial by preventing inefficient fragmentation of the land, it entails a cost by depriving nonconsenting owners of any value of their share of the land in excess of its market value. This paper develops an economic standard for choosing between partition and forced sale based on the objective of maximizing the aggregate value of the land. The basic trade-off is between the benefits of forced sale when scale economies are present and protection of subjective value under partition. A review of the case law suggests that courts have developed a standard that reflects this trade-off. Copyright 2000 by the University of Chicago.

Suggested Citation

  • Miceli, Thomas J & Sirmans, C F, 2000. "Partition of Real Estate; or, Breaking Up Is (Not) Hard to Do," The Journal of Legal Studies, University of Chicago Press, vol. 29(2), pages 783-796, June.
  • Handle: RePEc:ucp:jlstud:v:29:y:2000:i:2:p:783-96
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    File URL: http://dx.doi.org/10.1086/468093
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    Cited by:

    1. Marco LiCalzi & Antonio Nicolò, 2009. "Efficient egalitarian equivalent allocations over a single good," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 40(1), pages 27-45, July.
    2. Daniel P. Kessler & Daniel L. Rubinfeld, 2004. "Empirical Study of the Civil Justice System," NBER Working Papers 10825, National Bureau of Economic Research, Inc.
    3. Lueck, Dean & Miceli, Thomas J., 2007. "Property Law," Handbook of Law and Economics, Elsevier.
      • Dean Lueck & Thomas J. Miceli, 2004. "Property Law," Working papers 2004-04, University of Connecticut, Department of Economics.
    4. Holderness, Clifford G., 2003. "Joint ownership and alienability," International Review of Law and Economics, Elsevier, vol. 23(1), pages 75-100, March.
    5. Antonio Nicolò & Andrés Perea y Monsuwe & Paolo Roberti, 2012. "Equal opportunity equivalence in land division," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 3(1), pages 133-142, March.

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