Partitions come in two forms, partition in-kind or a partition sale. A partition in-kind physically divides the property among owners. The law in most states provides that this method of partition is preferred. North Carolina’s statutes, for example, states that the court shall order the sale of property only where it finds by preponderance of the evidence that an actual physical partition cannot be made without substantial injury to any interested party. N.C.G.S. 46-22(a) (emphasis added). Substantial injury is further defined as, “the fair market value of each share in an in-kind partition would be materially less than the share of each cotenant in the money equivalent …obtained from the sale of the whole, and if an in-kind division would result in material impairment of the cotenant’s rights.” N.C.G.S. 46-22(b). In practice, however, partition in-kind appears less favored by judges.
The quicker partition sale, which sends the property to the auction block, allows ownership to vest in the highest bidder. Partition sales are thought to be one of the primary causes of involuntary black land loss in recent times. The reason is that those who can afford to purchase property on the open market are more often developers with deep pockets instead of cash poor families. Individuals purchasing heirs’ property off the auction block can pay more cash for the property; but, it is those whose heritage is tied to the lands who attach the deepest value. Partition sales separate families from their heritage and their homes. If heirs’ property is purchased by an outside party for development, those tenants living on the land are displaced. At this point, heirs’ property intersects with issues of fair and affordable housing. Families, generally having limited income, may find themselves without a home and in need of affordable housing.
Partition sales can have devastating effects on heirs’ property and fair housing. It is important, therefore, that heirs’ property be identified. If those persons with an ownership interest can be identified, educated, and guided through the problems associated with heirs’ property, their heritage may be secured and ramifications effecting fair housing avoided. For these reasons the Southern Coalition for Social Justice, beginning in June 2008, conducted research to determine the extent to which heirs’ property, partition sales, and black land loss is occurring in Orange County, North Carolina.
Narrative of SCSJ’s Orange County Heirs’ Property Study
(Part of Appendix 1, with maps)