When co-owners of a property can’t agree on how to part ways, a partition action—usually resulting in a court-ordered sale—is often the only way forward. A common misunderstanding in partition cases relates to property improvements and the belief that making them automatically entitles someone to reimbursement equal to their expenditure. Unfortunately, that’s not always the case.
Courts make a clear distinction between necessary repairs and maintenance—which are typically reimbursable—and improvements, which may or may not be. Necessary repairs and maintenance, defined as expenses necessary to preserve common property, include, for example, those incurred to clean property after a fire, mortgage payments on jointly held property in excess of one’s proportionate share of payments, and costs to relocate a jointly held waterline. Henry v. Brooks, 651 S.W.3d 657 (Tex. App. Tyler 2022); Reynolds v. Haynes, 425 S.W.2d 29 (Tex. Civ. App. Eastland 1967), writ refused n.r.e., (May 8, 1968); Manning v. Benham, 359 S.W.2d 927 (Tex. Civ. App. Houston 1962), writ refused n.r.e., (Mar. 6, 1963); City of Grand Prairie v. City of Irving, 441 S.W.2d 270 (Tex. Civ. App. Dallas 1969). The co-owner that made the expenditure necessary repairs and maintenance is entitled to reimbursement for them in a partition proceeding.
Improvements, on the other hand—like installing granite countertops, building a pool, or upgrading flooring—are usually made to increase the aesthetic appeal or market value of the property, rather than preserving the property. While these enhancements might help fetch a higher sale price, they do not automatically entitle the person who paid for them to reimbursement.
In a partition suit, reimbursement for improvements made by one co-owner is not awarded on a dollar-for-dollar basis. Instead, courts consider whether the improvements increased the overall value of the property and, if so, to what extent. The reimbursing party is only entitled to recover the amount by which the improvements enhanced the property’s value—not the actual cost incurred. The enhancement value is the difference between the fair market value before and after any improvements. Anderson v. Gilliland, 684 S.W.2d 673, 675 (Tex. 1985). Thus, it is not simply the improvements’ cost. Sharp v. Stacy, 535 S.W.2d 345, 351 (Tex. 1976). This approach ensures that the reimbursement reflects the benefit conferred on the co-owners collectively, rather than compensating for potentially excessive or unilateral expenditures.
Facing a Partition Dispute Over Property Improvements?
If you’re in the middle of a partition action, understanding your rights to reimbursement is critical. Don’t risk losing out on what you’re owed—or paying more than you should.
Contact our Dallas real estate litigation team today to discuss your case and protect your financial interests in a partition suit.