This week our Property Poser experts are again faced with an emotive issue involving siblings who jointly inherited a fixed property and cannot seem to agree on the day-to-day running of it.
A reader writes that she not only inherited half the property but also lived there for a number of years – first with her mother, who owned the other half, and later, after her mother’s passing, with her daughter.
Unbeknown to her, her mother left her own half-share to the reader’s two siblings and this is where the trouble started.
Joint ownership of a property can be the cause of much strife if the obligations and rights of each owner are not set out properly, says Grant Berndt from Abdo & Abdo Attorneys in East London.
Berndt says some of the issues that have cropped up in our reader’s situation relate to the fact that she has been living in the property for several years and continues to live there.
“She has, over the past seven years, taken on all running expenses as well as maintenance expenses relating to the property.”
According to the reader, her siblings are requiring a lease contract to be signed and threats have been made of taking legal action against her to acquire her share in the property.
It is important at this stage to point out the differences between being an owner and being a tenant and that both situations could exist alongside one another, says Berndt.
“While our reader owns half of the property, this does not mean that she necessarily has the right to live there, as the other half belongs to different parties.”
As in any rental situation, Berndt says a lease agreement may well be a very good idea. “The parties should also consider concluding an agreement regarding the day-to-day running expenses of the property.
“The owners of the other 50% still remain liable for their proportionate share of utility bills, rates, taxes and maintenance costs.”
If the reader, for practical purposes, pays all of these expenses, the others’ portion could be set off against the agreed rental for the half-share of the property, says Brian Kinnear, principal of Fresh Lifestyle Properties in East London.
Should her rental portion therefore exceed her half of these expenses, Kinnear says she would be liable to pay over the balance. Similarly, should the rental be less, the reader would be entitled to claim the shortfall from the others.
“As far as taking legal action against the reader to acquire her share in the property, her siblings may face difficulty, especially if she is the one maintaining it and fulfilling all her rights in terms of the ‘partnership’ that has been formed.”
Kinnear says they could purchase her share of the property from her, but she would have to agree to such a transaction, while the option is also open to her to purchase the portion owned by her siblings.
“Although this situation came about without design, parties often enter into such a relationship without giving thought to the problems that could arise. An agreement regulating potential issues is always advisable.”
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