HOT TOPIC ALERT Tenancies in Common and Heirs' Property

May 2022

HOT TOPIC ALERT

Tenancies in Common and Heirs’ Property

Tenancy in common is the most frequent form of joint ownership of a single property. In

many circumstances, this form of ownership works quite well. However, it can have

severe adverse consequences on populations who enter this form of ownership through

inheriting land intestate—that is, when the owner dies and leaves the land to their heirs

without a will. Owning land as tenants in common means individual descendants lack

clear title—owning a fractional interest in the entire property rather than a specific piece.

After generations of intestate inheritance, ownership may be fragmented among tens or

hundreds of heirs. Under the default common law, tenants-in-common may face a court-

ordered partition sale by public auction if a single co-tenant demands it. This makes

owners of “heirs property” vulnerable to forced sale and eviction, sometimes from land

that has been in their family for generations. It is estimated that some 90% of Black-owned

farmland acquired since the Civil War has been lost, in many instances due to forced

partition.

Through the efforts of many, including many state REALTOR® organizations, these

negative consequences are being minimized through the enactment of legislation that

provides simple due process protections for owners of heirs’ property, such as the

Uniform Partition of Heirs’ Property Act (UPHPA).

Tenancy in Common

A. Definition of tenancy in common

Generally referred to as concurrent estates, property law includes three types of estates.

For the purposes of this paper, we will examine a tenancy in common which is defined by

two or more people having separate ownership shares and rights in a property or parcel

of land. Each person holds an individual, undivided ownership interest, which gives them

an equal right to use the property or to transfer their ownership interest.

B. How tenancies in common are created

The tenancy in common is formed when two or more owners have an ownership interest

in a property. Tenants in common may convey, or transfer, their property interests to

another individual at any time during the life of the tenant. In the case where the owner

passes without a valid will, the property will pass to their estate under the rules of

intestacy. Tenancy in common is the default form of joint ownership. If there is more than

one heir under the intestacy rules, they will take the property as tenants in common.

Example: Larry is the sole owner of a small farm. He has he has three daughters, but has

never bothered to make a will. He assumes that the daughter who works the farm with

him will be the one to take over and inherit the farm after his death. When Larry dies, his

property goes to his three daughters as tenants in common. The daughter who worked

the farm does not have a greater interest than either of her sisters.

C. Partition of tenancies in common

Partition is a court action that divides property between co-owners. While joint owners

usually can agree to split the property themselves, a partition action is when the court

orders the division at the request of one of the co-owners. There are two kinds of partition:

partition in kind; and partition by sale. Partition in kind is a physical division of the property

determined by the court. Partition in kind is often difficult to achieve, especially where a

structure such as a home is present on the property. Where it is not possible to equitably

divide the property, a partition by sale will occur. In a partition by sale, the court forces

the sale of the property and each co-tenant receives their share of the profits.

Sometimes, an heir gains ownership to a share of the tenancy in common – either as

directed by a will or through intestacy - but has no desire to own part of the property. In

fact, the heir may not even have the resources for their share of taxes assessed against

the property. In these types of circumstances, the heir/owner may seek any type of cash

settlement.

This leaves the other tenant in common owners in a vulnerable position because the

purchaser may then force a partition by sale of entire property. Depending on the state

where the property is located, this may result in the property being sold by a court ordered

receiver, or the property may be sold at auction at less than market value. As a result, the

co-tenants lose their property rights and must take proceeds of forced sale, usually less

than could have been obtained at an ordinary sale.

In one tragic case that demonstrates the inequities that can occur, an uncle and a niece

inherited a property in North Carolina with a property tax assessed value of $123,600.

Taxes of approximately $1,600 were due, but neither the uncle nor the niece had the

resources to pay the tax. As a result, the county foreclosed on the property and the land

went to auction. During the foreclosure process, an unscrupulous individual gave the

uncle $4,400 with an option to purchase his share of the property. Although the uncle was

led to believe that the intent of the third party was to help the family keep the property, it

was not. In the end, the niece received nothing upon the sale by partition and the uncle

became homeless.

Heirs’ property

Heirs’ property is family-owned land that is jointly owned by descendants of a deceased

person whose estate did not clear probate. The descendants, or heirs, have the right to

use the property, but they do not have a clear or marketable title to the property since the

estate issues remain unresolved.

Since some segments of the population lack access to legal services, property transfers

may occur generation after generation without the benefit of wills or estate plans. When

this happens, ownership of the land becomes increasingly fractionated with the passing

of each generation, so that over time the lands may be owned collectively by dozens or

more descendants. Frequently, some family members may continue to live on and work

the land, while other co-tenants may move away and lose any connection to the land.

Clearing title after numerous transfers can be expensive and time consuming, even when

all co-tenants are in agreement, and is often just not done.

A. Impact of heirs’ property on Black Americans

The impact of the issues with heirs’ property are felt disproportionately by rural and Black

American populations for whom owning property was a mission after the Civil War.

Consider, for example, that while Black Americans owned 16 million acres of land in the

US by 1910, that figure had decreased to about 3 million acres by 2012. In addition, by

some estimates, heirs property makes up more than a third of black-owned land in the

Southern United States — 3.5 million acres, with a value of more than $28 billion.

Essentially, the property rights of the heirs are taken away through no fault of the owners,

depriving heirs of generational wealth.

B. Stories demonstrating impact

The plight of Black American property owners is detailed by the story of Evelina Jenkins.

Ms. Jenkins, at 65 years old, had lived most of her life on property that her grandfather

had farmed and raised his family on. For years, she paid a man $15 a year that she was

led to believe was for the payment of taxes on the land. Then, one year Mrs. Jenkins went

to the man with the annual $15 payment but was told that her payment for all those years

was not for taxes but instead was an annual rent payment. He informed her that he owned

the property during this time, not her. He also told her that he had now sold the property

and she would need to vacate the premises. It appears that the man had let the property

taxes lapse on the land, and then bought it himself when the county sold it at auction. She

now lives on land owned by her cousin, while her property has been transformed into

what has been called a “a middle‐class white playground and residential community worth

many thousands of dollars.”

Another illustrative story is the case of two brothers - Melvin Davis and Licurtis Reels.

The Reels family has ties to property in North Carolina dating back to Reconstruction,

when apparently the land was gifted to family ancestors after being freed from slavery.

Elijah Reels appears to have taken formal ownership of the land in 1911. Elijah’s

grandson, Mitchell, eventually took ownership of the land but died intestate, which led to

a distant relative being able to claim ownership of a portion of the land.

Although descendants of Mitchell Reels, brothers Licurtis Reels and Melvin Davis,

continued to occupy and claim ownership of the property, the land was sold by another

co-tenant in 1985 and then again in 1986, without their consent. From that time until 2011,

the purchaser took the brothers to court numerous times and won judgment after

judgment for the brothers to remove their homes and promise not to trespass on the land

their family had owned for generations. But they refused to vacate the property or to

concede ownership. Finally, in 2011 a Contempt of Court order was issued and the

brothers were ordered to jail until they agreed to abide by the judgment to remove their

homes and not trespass on the land. The brothers spent eight years in jail protesting the

sale of property owned by their family as far back as 1911.The brothers remain in

contempt of the court order even though they were released from jail in 2019. See also

Adams Creek Assoc. v. Davis, 257 N.C. App. 391, 810 S.E.2d 6 (2018), vacated and

remanded 371 N.C. 464, 818 S.E.2d 100 (2018).

C. Uniform Partition of Heirs’ Property Act (UPHPA)

The Uniform Partition of Heirs Property Act (UPHPA) helps preserve family wealth passed

to the next generation in the form of real property. The UPHPA does this by providing a

series of simple due process protections:

- notice,

- appraisal,

- right of first refusal, and

- if the other co-tenants choose not to exercise their right and a sale is required, a

commercially reasonable sale supervised by the court to ensure all parties

receive their fair share of the proceeds.

The has been adopted by 20 states and US Virgin Islands. Legislation to adopt the Act

is pending in eight states and the District of Columbia.

The UPHPA is a model law promulgated by the Uniform Law Commission (ULC).

The ULC, also known as the National Conference of Commissioners on Uniform State

Laws, established in 1892, provides states with non-partisan, well-conceived and well-

drafted legislation that brings clarity and stability to critical areas of state statutory law.

 
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The UPHPA was principally drafted by Prof. Thomas Mitchell at Texas A&M University.  
 
Professor Mitchell is a nationally recognized expert on Black land loss. Professor Mitchell 
began taking action after witnessing the erosion of property rights by Black and other 
disadvantaged  populations  through  heirs  property.  His  work  has  identified  the  most 
vulnerable property owners as those who have a low income or low wealth and lack of 
access to  legal  services, and  thus  have  a  low  rate of will making or estate  planning 
(approximately 24% of Black Americans have a will, as opposed to approximately 61% of 
non-Latino  white  Americans).  Their  properties  are  located  in  areas  undergoing 
intensification of development and a rapid appreciation of property values. 
 
Since its introduction in 2010, the UPHPA has had a positive impact in the twenty states 
where it has been adopted. There has been a significant reduction in number of abusive 
partition  actions  being  filed  in  many  states  that  have  adopted  the  UPHPA,  including 
Georgia  and  South  Carolina.  The  UPHPA  has  also  helped  bring  about  a  dramatic 
increase in sales prices being realized for partition sales under UPHPA’S open-market 
sale procedure. For example, in one Texas case,  property sold for $3,000,000 using 
UPHPA open-market sales procedure, instead of the $1,000,000 that would have been 
realized using the normal judicial sale, auction procedure conducted at the courthouse. 
 
D. Heirs Property Relending Program  
Federal legislation has also been enacted to help with the problem of heirs property. The 
Heirs’ Property Relending Program (HPRP), established as part of the 2018 Farm Bill (PL 
115-334)  lends funds  to  eligible  entities  to  make  loans  to  assist  heirs  with  resolving 
ownership and succession issues on farmland with multiple owners. Eligible lenders may 
borrow up to $5 million for relending, at an annual interest rate of 1%. The Department of 
Agriculture (USDA) provides funds to intermediary lenders who, in turn, make loans to 
qualified individuals. Funds may also be used for buying out the interests of other heirs in 
jointly-owned property, and for expenses incurred in clearing the title to the heirs property, 
including  closing  costs,  appraisals,  title  searches,  surveys,  preparing  documents, 
mediation, and legal services.   To date, $67 million has been appropriated for the HPRP. 
 
E.  HPRP alternative documentation 
In addition to loans, the HPRP established a program to assist the operators of heirs 
property in becoming eligible for federal agricultural assistance. The USDA requires a 
farm number for participation in these programs, but with unclear title, such a number can 
be difficult, if not impossible, to obtain. The HPRP allows heirs’ property operators (not 
just  owners)  to  establish  a  farm  number,  to  be  eligible  for  USDA  programs.  These 
programs  include  lending,  disaster  relief  programs,  and  participation  in  county 
committees.  
If a state has adopted the UPHPA, a farm number will be issued on presentation of: 
 
-  A court order verifying the land meets the definition of heirs’ property as defined in 
the UPHPA; or  

- A certification from the local recorder of deeds that the recorded owner of the land

is deceased and at least 1 heir has initiated a procedure to retitle the land.

In states that have not adopted the UPHPA, a farm number can be obtained by

presenting:

- A tenancy-in-common agreement, approved by a majority of the owners, that gives

the individual the right to manage and control a portion or all of the land,

- Tax returns for the previous 5 years showing the individual has an undivided

farming interest,

- Self-certification that the individual has control of the land for purposes of operating

a farm or ranch,

- Any other documentation acceptable by the FSA county office, that establishes

that the individual has general control of the farming operation, including, but not

limited to, any of the following:

o affidavit from an owner stating that the individual has control of the land

limited power of attorney giving the individual control of the land, or

o canceled checks and or receipts for rent payments and/or operating

expenses.

F. REALTOR® Association activity

The National Association of REALTORS® (NAR) represents 1.5 million residential and

commercial practitioners involved in all facets of the industry as brokers, sales agents,

property managers, appraisers, and counselors. As the largest professional trade

association in the United States, NAR advocates for policies that promote and protect a

dynamic U.S. real estate market and fosters homeownership and investment

opportunities for qualified purchasers of real property. A fundamental principle of NAR is

the protection of property rights.

The National Association of REALTORS® State and Local Issues Policy Committee and

the Fair Housing Policy Committee examined these issues through an informational

webinar on April 13, 2022. As of this publication, the State and Local Issues Policy

Committee is determining whether to add a policy statement to encourage its state

associations to promote legislation to reform state laws that provide due process

protections for owners of heirs’ property, such as the UHPHA.

State REALTOR® associations have helped the UPHPA over the finish line in several

state legislature

South Carolina – With the support and efforts of the South Carolina Association of

Realtors, the Clementa C. Pinckney Uniform Partition of Heirs’ Property Act was passed

in 2016. The Act was named in honor of the late pastor and Senator Clementa Pinckney,

who was killed in the 2015 Emanuel African Methodist Episcopal Church shooting in

Charleston, and whose legislative career included advocacy on behalf of disadvantaged

property owners. Local affiliates, like the Charleston Trident Area Association of

REALTORS®’ Diversity and Inclusion Task Force, also continue to work to educate the

 
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public on property rights and assist those that are dealing with heirs’ property issues. 
 
California – On March 8, 2021, the California Association of Realtors (CAR) announced 
a Fair Housing and Equity legislative package designed to help  address ongoing fair 
housing and equity issues that persist, especially for communities of color. Recognizing 
the need to address California’s worsening housing affordability and availability crisis with 
increased  housing  supply  and  fair  housing  reforms,  C.A.R.  has  established  the 
Californians Need Housing Now initiative. This initiative has urged the Legislature to enact 
the bills specifically designed to address the historic and ongoing inequities facing black, 
indigenous, and people of color (BIPOC) communities that have made it harder for these 
communities to access and afford housing in California. Included in this package was 
Uniform Partition of Heirs Property Act. This bill adds California to the list of states that 
utilize  the  Uniform  Partition of  Heirs  Property  Act  (UPHPA),  an  act  promoted  by  the 
Uniform Law Commission. 
 
Other state associations are working for adoption of the UPHPA. In Massachusetts, a 
state in which legislation to enact the UPHPA is pending, the Association of Realtors® 
has  an  online  seminar  series  given  by  Professor  Mitchell,  in  which  the  UPHPA  is 
explained and which sets out suggestions for advocacy for the UPHPA. The Maryland 
Association of Realtors® has put its support behind  HB 777/SB 92, bills to enact the 
UPHPA. Both bills passed the Legislature by unanimous votes, and are being sent to the 
Governor for approval. 
 
G. Other Organizations 
 
The UPHPA has support from a wide range of organizations. The American College of 
Real Estate Lawyers was an early supporter of the Act. The American Bar Association, 
particularly its sections of State and Local Government Law and Real Property, Trust and 
Estate Law, has also  advocated  for  the  UPHPA,  and continues  to provide education 
materials on the Act and also engages in discussion regarding ways to strengthen the 
protections for owners of heirs property. 
 
Other organizations who support the UPHPA include the NAACP, the American Planning 
Association, and the American Land Title Association. 
 
The  farm  machinery  manufacturer  John  Deere has  joined  with  the  National  Black 
Growers Council and the Thurgood Marshall College Fund to establish a coalition focused 
on the work needed to improve the livelihoods of Black farmers. The coalition will place  
a particular emphasis on the preservation of heirs' property in rural communities. The 
Federation of Southern Cooperatives, with funding provided by John Deere, is sponsoring 
summer interns to work on the legal issues surrounding heirs property. 
 
 
 
 
 

CONCLUSION

The Uniform Partition of Heirs Property Act and similar legislation holds remarkable

promise for protecting property rights, curbing partition abuse, and preserving family

wealth. More work needs to be done to get this important legislation enacted into all

remaining US jurisdictions, with state REALTOR® associations playing an important role

in this effort. REALTORS® can help reform property law to address the loss of property

and wealth by vulnerable populations.

ADDITIONAL STATE & LOCAL RESOURCES

White Papers: Comprehensive reports prepared for NAR on issues

directly impacting the real estate industry. Examples include: Rental

Restrictions, Land Banks, Sales Tax on Services, State & Local Taxation,

Building Codes, Hydraulic Fracturing, Foreclosure Property Maintenance,

Climate Change, Private Transfer Fees.

Growth Management Fact Book: Analysis of issues related to land use and

modern growth management topics include density — rate of growth, public

facilities and infrastructure, protection of natural resources, preservation of

community character, and affordable housing.

All available on REALTOR® Party webpage

under the State & Local Issues

tab.

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Questions or concerns contact Melissa Horn

Email: MH[email protected] Phone: 202-383-1026