Sharing of land division costs

Co-owners must share the costs of dividing their land according to their share

Co-owners should find solutions for the development, division or sale of their property and avoid disputes that may end up in court, which will further worsen relations between them, especially when it comes to close relatives.

In trying to reach a written agreement on the division of the property and determine their share of the expenses according to the share of each, co-owners must cooperate and fulfill their obligations and logic and common good should prevail, rather than one trying to obtain an advantage over another.

Matters such as part of the land being affected by its division, street planning, compulsory acquisition or terms imposed by the authorities, should be resolved in a fair way, instead of causing a dispute and negative feelings.

If they agree that the expenses of the division will be shared according to the share of each, they owe cooperation and adherence to this agreement.

The case

Two brothers co-owned half a share each of a plot which their father had gifted them, by a written agreement that it should be divided and each receive his own share. They would sign any application for the division and declaration of assignment, granting, reduction due to street planning or anything else legally requested of them by the competent municipality, land registry or other authorities. It was agreed that all costs of division be paid in proportion to their share.

They also agreed that if there was street planning, compulsory acquisition or any other factor that negatively or positively affected the plot that each would receive, then the burden or benefit would full entirely on the one whose plot was affected by any changes.

The relevant subdivision permit was issued by the Town Planning Authority and, among other requirements, the following conditions were imposed: (a) part of the plot would be affected by widening of a public road and (b) along the widened road a paved sidewalk would be built.

The brother whose plot was affected accepted this even though its area was decreased. In order to implement the division, he paid the relevant expenses related to the costs of the construction of the sidewalk and asked the other brother to contribute half of the expenses, but he refused since in his view the part received by his brother benefited.

The matter resulted in the dispute being brought before court for it to decide whether the costs of the construction of the pavement under the agreement were part of the costs borne by the parties. The court of first instance concluded that the terms of the agreement left no doubt as to what the two brothers really agreed to, namely that each of them should bear equally all the expenses of the division and therefore issued a decision against the brother who refused to pay half the costs.

Judgment of the Supreme Court

The matter did not end there since this decision was appealed. The Supreme Court, in its judgment issued in C.A.165/2016 dated July 24, held that the interpretation of the terms of a document, as the court of first instance determined, is a legal matter and a task for the court.

It analysed the principles governing the interpretation of a contract and did not agree with the appellant brother that because it was stipulated in the agreement that if there was a division the impact would be borne by the party whose plot would be affected, he should also bear the entire costs of the division.

Construction of the sidewalk was a condition of the subdivision permit. The costs for the construction of the sidewalk were an expense necessary to effectuate the division, and it was rightly held that it should be equally borne by the co-owners as per their agreement.

It concluded that without the fulfillment of the terms of the division permit, the division would not take place and this would, as both sides admitted, be to their detriment, which is why the appeal was dismissed.

George Coucounis is a lawyer specialising in Immovable Property Law, based in Larnaca. E-mail: coucounis.law@cytanet.com.cy, tel: 24818288