What to do when you want to sell, but your co-owner doesn’t

If you own property with one or more parties and are looking to sell, but your co-owner(s) is uncooperative and doesn’t want to sell, what can you do?

In the absence of a co-ownership agreement prepared at the time the parties acquired the property (which sets out the rights and obligations of each co-owner), and if the parties can’t come to some commercial arrangement or compromise, then a party can make an application to the Court under section 66G of the Conveyancing Act 1919 (NSW).

The Court may appoint (usually) two trustees of the property (but not exceeding four trustees) and vest the property in those trustees to be held by them on statutory trust for sale.

The power of the Court to make such an order is discretionary. Such an order is almost “as of right” unless it would be inequitable to allow the application: Callahan v O’Neill [2002][1]. In Myers v Clark [2018][2] the Court considered the observations of Beazley JA in Hogan v Baseden [1977][3] that while the section is a discretionary provision and does not give rise to an absolute entitlement to an order, the circumstances where relief has been refused have been constrained. In that same case, Mason P added that itwould not be a proper exercise of the power to decline relief under s 66G of the Conveyancing Act to refuse the application on grounds of hardship or general unfairness. In the unhappy event that the parties are unable to settle their differences then the making of an order appointing trustees for sale seems inevitable unless there can be established a legally binding agreement not to put a party out of occupation of their home, or other equitable circumstances.

An example of the limited discretion to refuse to make an order can be exercised is where such an order would be inconsistent with a proprietary right or a contractual or other obligation. In Ngatoa v Ford (1990)[4], relief was refused under section 66G because the parties had a contract between them which limited their ability to dispose of their interests in the property. In another example, in Capolongua v Da Silva [2016][5], the parties were bound by a deed that included a provision that none of the parties “shall under any circumstances seek to exercise any right of sale conferred by section 66G of the Conveyancing Act unless the property had been marketed conscientiously for a period of one year”. The judge accepted that it was not appropriate to make such orders where the requirement had not yet been fulfilled.

Contact the team at Conditsis Lawyers on (02) 4324 5688 to demystify your property law questions.  

[1] NSWSC 877

[2] NSWSC 1029

[3] NSWCA 150

[4] 19 NSWLR 72

[5] NSWSC 1212

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