All questions
Question 1
A married couple owned their home as tenants by the entirety. The husband, a sole proprietor, incurred a large business debt to a supplier. The supplier obtained a judgment against the husband individually and then brought an action to compel a partition and sale of the couple's home to satisfy the judgment. The wife was not a party to the business debt and objects to the partition.
What is the most probable outcome of the supplier's partition action? Select one.
- The court will order the sale, and the supplier can recover from the husband's one-half share of the proceeds.
- The court will sever the tenancy by the entirety into a tenancy in common, allowing the creditor to attach the husband's interest.
- The court will dismiss the action because property held by tenancy by the entirety is not subject to partition for the separate debts of one spouse. (correct answer)
- The court will place a lien on the husband's interest, which can be foreclosed upon if the couple divorces or the wife predeceases the husband.
Explanation: The correct answer is C. A key feature of a tenancy by the entirety is that it protects the property from the individual creditors of either spouse. One spouse cannot unilaterally encumber or convey their interest, and a creditor of only one spouse cannot force a partition or sale of the property to satisfy the separate debt. Therefore, the supplier's action will be dismissed. (A) and (B) are incorrect because they describe remedies that are unavailable against property held in a tenancy by the entirety. (D) describes a possible outcome in some jurisdictions regarding a creditor's lien, but the immediate partition action will be dismissed.
Question 2
Two business partners purchased a 50-acre parcel of land as tenants in common. They could not agree on how to develop it and one filed for partition. The court determined that a partition in kind was appropriate. It divided the property into Parcel X, a 20-acre plot with valuable river frontage appraised at $300,000, and Parcel Y, a 30-acre plot with limited access appraised at $200,000. The court awarded Parcel X to one partner and Parcel Y to the other.
To ensure a fair and equitable partition, what additional order must the court make? Select one.
- Order the partner receiving Parcel X to grant an access easement across it to the owner of Parcel Y.
- Order a partition by sale, as the parcels created are not of equal value.
- Order the partner receiving Parcel X to pay owelty of $100,000 to the partner receiving Parcel Y.
- Order the partner receiving Parcel X to pay owelty of $50,000 to the partner receiving Parcel Y. (correct answer)
Explanation: The correct answer is D. When a partition in kind results in parcels of unequal value, the court can order a monetary payment, called owelty, from the cotenant who receives the more valuable parcel to the other cotenant to equalize the distribution. The total value of the property is $300,000 + $200,000 = $500,000. Each partner's equal share is $250,000. The partner who received Parcel X (value $300,000) received $50,000 more than their share. The partner who received Parcel Y (value $200,000) received $50,000 less. Therefore, the partner with Parcel X must pay $50,000 in owelty to the partner with Parcel Y. (B) is incorrect because owelty is the specific remedy to avoid a sale in this situation. (C) is an incorrect calculation based on the total difference in value. (A) might be an equitable consideration but does not address the monetary imbalance.
Question 3
Two friends purchased a vacant parcel of land for $100,000 as tenants in common, each contributing $50,000. Without the consent of the other, one friend spent $40,000 to build a small workshop on the property. The workshop increased the fair market value of the entire property by $60,000. The other friend subsequently filed for partition. The court ordered a partition by sale, and the property sold for $220,000.
Assuming no other adjustments are necessary, how much of the sale proceeds is the friend who built the workshop entitled to receive? Select one.
- $110,000.
- $130,000.
- $140,000. (correct answer)
- $160,000.
Explanation: The correct answer is C. In a partition action, a cotenant who makes improvements to the property without the consent of other cotenants is not entitled to contribution for the cost of the improvement. However, upon partition, the improving cotenant is entitled to the value added by the improvement. Here, the workshop added 60,000invalue.Thisvalueiscreditedtotheimprovingfriendfirst.Theremainingpropertyvalue(220,000 - $60,000 = $160,000) is divided according to their ownership interests (50/50). Thus, the improving friend receives $60,000 (for the added value) + $80,000 (half of the remainder) = 140,000.(A)isincorrectbecauseitreflectsasimple50/50splitofthetotalproceeds,ignoringtheimprovement.(B)isincorrectbecauseitwronglycreditstheimprovingfriendforthecostoftheimprovement(40,000) rather than the value added. (D) is a miscalculation. Question 4
Two friends purchased a vacant parcel of land for $100,000 as tenants in common, each contributing $50,000. Without the consent of the other, one friend spent $40,000 to build a small workshop on the property. The workshop increased the fair market value of the entire property by $60,000. The other friend subsequently filed for partition. The court ordered a partition by sale, and the property sold for $220,000.
Assuming no other adjustments are necessary, how much of the sale proceeds is the friend who built the workshop entitled to receive? Select one.
- $110,000.
- $130,000.
- $140,000. (correct answer)
- $160,000.
Explanation: The correct answer is C. In a partition action, a cotenant who makes improvements to the property without the consent of other cotenants is not entitled to contribution for the cost of the improvement. However, upon partition, the improving cotenant is entitled to the value added by the improvement. Here, the workshop added 60,000invalue.Thisvalueiscreditedtotheimprovingfriendfirst.Theremainingpropertyvalue(220,000 - $60,000 = $160,000) is divided according to their ownership interests (50/50). Thus, the improving friend receives $60,000 (for the added value) + $80,000 (half of the remainder) = 140,000.(A)isincorrectbecauseitreflectsasimple50/50splitofthetotalproceeds,ignoringtheimprovement.(B)isincorrectbecauseitwronglycreditstheimprovingfriendforthecostoftheimprovement(40,000) rather than the value added. (D) is a miscalculation. Question 5
Three siblings, A, B, and C, own a tract of land as tenants in common. A court orders a partition by sale. At the public judicial auction, B makes the highest bid and purchases the property. A and C object to the confirmation of the sale, arguing that B, as a cotenant, breached a fiduciary duty by purchasing the property for herself.
Is the objection by A and C likely to succeed in preventing the confirmation of the sale to B? Select one.
- Yes, because a cotenant is a fiduciary and cannot engage in self-dealing by purchasing the common property at a partition sale.
- Yes, unless B can prove that the purchase price was substantially above the fair market value of the property.
- No, because a cotenant is generally permitted to bid on and purchase the property at a public partition sale. (correct answer)
- No, because by participating in the partition action, A and C implicitly consented to B's participation in the auction.
Explanation: The correct answer is C. While cotenants owe certain duties to each other, this duty does not typically extend to prohibiting one cotenant from bidding at a public, court-ordered partition sale. The sale is conducted by an officer of the court, and all parties have an equal opportunity to bid. Allowing cotenants to bid can help drive up the sale price, benefiting all owners. Absent fraud or collusion, a sale to a cotenant at a public auction is valid. (A) overstates the fiduciary duty in this context; it is not considered prohibited self-dealing. (B) misstates the standard; the sale must be commercially reasonable, but there's no requirement for the price to be above market value. (D) is incorrect because consent is not the basis for the rule; the rule is that the conduct is permissible.
Question 6
Two friends purchased a parcel of land as tenants in common. They orally agreed that they would not seek partition for at least ten years, intending to build a shared retirement cabin on the land in the future. Two years later, one friend had a change of heart and filed a lawsuit to compel partition.
Will the court enforce the oral agreement not to partition? Select one.
- Yes, because the agreement is for a reasonable duration and purpose, and part performance makes it enforceable.
- Yes, because agreements between cotenants regarding the use of land are not subject to the Statute of Frauds.
- No, because the right to partition is absolute and cannot be restricted by any agreement, oral or written.
- No, because an agreement restricting the right to partition real property is an interest in land that must be in writing under the Statute of Frauds. (correct answer)
Explanation: The correct answer is D. An agreement that restricts the right to partition is considered to be a contract concerning an interest in real property. As such, it is subject to the Statute of Frauds and must be in writing to be enforceable. Because the agreement in the fact pattern was oral, it is unenforceable. (A) is incorrect because there is no evidence of part performance sufficient to take the agreement out of the Statute of Frauds, and the primary issue is the lack of a writing. (B) is incorrect; such agreements are subject to the Statute of Frauds. (C) is incorrect because the right to partition can be restricted by a written agreement that is reasonable.
Question 7
Three siblings, A, B, and C, own a tract of land as tenants in common. A court orders a partition by sale. At the public judicial auction, B makes the highest bid and purchases the property. A and C object to the confirmation of the sale, arguing that B, as a cotenant, breached a fiduciary duty by purchasing the property for herself.
Is the objection by A and C likely to succeed in preventing the confirmation of the sale to B? Select one.
- Yes, because a cotenant is a fiduciary and cannot engage in self-dealing by purchasing the common property at a partition sale.
- Yes, unless B can prove that the purchase price was substantially above the fair market value of the property.
- No, because a cotenant is generally permitted to bid on and purchase the property at a public partition sale. (correct answer)
- No, because by participating in the partition action, A and C implicitly consented to B's participation in the auction.
Explanation: The correct answer is C. While cotenants owe certain duties to each other, this duty does not typically extend to prohibiting one cotenant from bidding at a public, court-ordered partition sale. The sale is conducted by an officer of the court, and all parties have an equal opportunity to bid. Allowing cotenants to bid can help drive up the sale price, benefiting all owners. Absent fraud or collusion, a sale to a cotenant at a public auction is valid. (A) overstates the fiduciary duty in this context; it is not considered prohibited self-dealing. (B) misstates the standard; the sale must be commercially reasonable, but there's no requirement for the price to be above market value. (D) is incorrect because consent is not the basis for the rule; the rule is that the conduct is permissible.
Question 8
Two parties co-own a commercial building as tenants in common. The entire building is subject to a single, 10-year lease with a well-established retail company, which has eight years remaining on the term. One of the cotenants files for partition by sale due to a disagreement over management.
What is the most likely effect of the partition action on the lease? Select one.
- The partition action is barred until the lease expires, as the leasehold creates an implied waiver of the right to partition.
- The partition action will terminate the lease, and the property will be sold free and clear of the tenant's interest.
- The court will order the property sold, and the purchaser will take title subject to the existing lease. (correct answer)
- The court will require the cotenants to buy out the tenant's leasehold interest before a partition sale can be ordered.
Explanation: The correct answer is C. A partition action divides the interests of the cotenants, but it does not, by itself, extinguish the valid rights of third parties, such as tenants with a valid lease. The court can order a sale of the property, but the sale will be of the fee simple interest as encumbered by the lease. The purchaser at the partition sale becomes the new landlord and takes the property subject to the tenant's rights under the existing lease. (A) is incorrect because leasing the property does not generally bar the right to partition. (B) is incorrect as partition does not terminate the lease. (D) is incorrect; there is no requirement for the cotenants to buy out the lease.
Question 9
One of two tenants in common of an apartment building changed the locks and refused to provide a key to the other cotenant, telling her, "This place is mine now, stay away." The ousted cotenant waited one year and then brought a successful action for partition and an accounting. The fair rental value of the entire property for that year was $60,000. The cotenant in possession paid $10,000 in necessary operating expenses during that year.
In the accounting, what amount is the ousted cotenant entitled to receive from the cotenant in possession for the year of ouster? Select one.
- $25,000. (correct answer)
- $30,000.
- $50,000.
- $60,000.
Explanation: The correct answer is A. When one cotenant ousts another, the ousted cotenant is entitled to her pro-rata share of the fair rental value of the property for the period of the ouster. Here, the ousted cotenant's share is 50% of $60,000, which is $30,000. However, the cotenant in possession is entitled to a credit for the ousted cotenant's share of necessary expenses paid. The ousted cotenant's share of the $10,000 in expenses is $5,000. Therefore, the net amount owed to the ousted cotenant is $30,000 (her share of rent) minus $5,000 (her share of expenses), which equals $25,000. (B) is incorrect because it fails to credit the possessor for the expenses. (C) and (D) are incorrect calculations.
Question 10
Two individuals own a 20-acre parcel of land as tenants in common. The land is zoned for residential use, but a local ordinance requires a minimum lot size of 15 acres for any new construction. The land's highest and best use is as a single 20-acre residential estate. One owner files an action for partition, requesting a partition in kind.
What is the court's most likely ruling on the request for partition in kind? Select one.
- Grant the partition in kind, creating one 15-acre lot and one 5-acre lot, and use owelty to equalize the value.
- Grant the partition in kind, dividing the property into two 10-acre lots, despite the zoning ordinance.
- Deny the partition in kind and order a partition by sale, because division would create non-conforming lots and cause great prejudice. (correct answer)
- Deny the partition action entirely until the owners obtain a variance from the zoning board.
Explanation: The correct answer is C. A court will not order a partition in kind if it would cause great prejudice to the owners. Dividing the 20-acre parcel into two 10-acre lots would create two parcels that do not comply with the 15-acre minimum zoning ordinance, likely rendering them undevelopable and drastically reducing their value. This constitutes great prejudice. Therefore, the only equitable solution is to order a partition by sale and divide the proceeds. (A) would leave one owner with an undevelopable lot, which is inequitable. (B) is incorrect because the court will not create an illegal subdivision. (D) is incorrect because the right to partition is not contingent on seeking a variance.
Question 11
A woman and her brother owned a small office building as tenants in common, with the woman holding a 75% interest and the brother holding a 25% interest. The property was unencumbered. After a dispute, the brother filed for partition by sale. The court ordered the sale, and the property sold for $400,000 net proceeds. Before the sale, the woman had paid $20,000 for a new roof, a necessary repair.
How should the $400,000 in proceeds be distributed? Select one.
- The woman receives $300,000 and the brother receives $100,000.
- The woman receives $315,000 and the brother receives $85,000.
- The woman receives $320,000 and the brother receives $80,000.
- The woman receives $305,000 and the brother receives $95,000. (correct answer)
Explanation: The correct answer is D. First, an accounting for necessary expenses must be done. The woman paid $20,000 for a necessary repair. She is entitled to contribution from her brother for his pro-rata share, which is 25% of $20,000, or $5,000. This is handled by first paying the woman back her $20,000 expense from the proceeds, or by adjusting their shares. Using the adjustment method, the proceeds are first divided based on ownership: Woman gets 75% of 400,000(300,000) and Brother gets 25% ($100,000). Then, the Brother must reimburse the Woman for his share of the roof cost. So, $5,000 is transferred from the Brother's share to the Woman's share. The woman ends up with $300,000 + $5,000 = $305,000, and the brother ends up with $100,000 - $5,000 = $95,000. Question 12
Two cousins, Amy and Ben, own a commercial property as tenants in common with equal shares. For the past three years, Ben has exclusively managed the property. He leased the property to a third-party business for $5,000 per month and collected all the rent, depositing it into his personal account. Ben also paid $30,000 in property taxes over the three-year period from his own funds. Amy, who lives abroad, has now sued for partition and an accounting.
In the accounting, what is the net amount Ben will owe Amy from the rental income and tax payments? Select one.
- $75,000. (correct answer)
- $90,000.
- $150,000.
- $180,000.
Explanation: The correct answer is A. A cotenant who collects rent from a third party must account to the other cotenants for their pro-rata share. Total rent collected is $5,000/month * 36 months = $180,000. Amy's share is 50%, or $90,000. A cotenant who pays common expenses, like property taxes, is entitled to contribution from other cotenants. Total taxes paid were $30,000. Ben is entitled to a contribution from Amy for her 50% share, which is 15,000.Therefore,thenetamountBenowesAmyishershareoftherent(90,000) minus her share of the taxes ($15,000), which equals $75,000. Question 13
Two parties co-own a commercial building as tenants in common. The entire building is subject to a single, 10-year lease with a well-established retail company, which has eight years remaining on the term. One of the cotenants files for partition by sale due to a disagreement over management.
What is the most likely effect of the partition action on the lease? Select one.
- The partition action is barred until the lease expires, as the leasehold creates an implied waiver of the right to partition.
- The partition action will terminate the lease, and the property will be sold free and clear of the tenant's interest.
- The court will order the property sold, and the purchaser will take title subject to the existing lease. (correct answer)
- The court will require the cotenants to buy out the tenant's leasehold interest before a partition sale can be ordered.
Explanation: The correct answer is C. A partition action divides the interests of the cotenants, but it does not, by itself, extinguish the valid rights of third parties, such as tenants with a valid lease. The court can order a sale of the property, but the sale will be of the fee simple interest as encumbered by the lease. The purchaser at the partition sale becomes the new landlord and takes the property subject to the tenant's rights under the existing lease. (A) is incorrect because leasing the property does not generally bar the right to partition. (B) is incorrect as partition does not terminate the lease. (D) is incorrect; there is no requirement for the cotenants to buy out the lease.
Question 14
Three investors purchased a commercial building as tenants in common. Their written and signed ownership agreement included a clause stating, 'For the purpose of achieving long-term capital appreciation, no party shall seek to partition the property for a period of twenty years from the date of this agreement.' Five years later, one investor suffered a personal financial crisis and sued for partition by sale.
Is the court likely to grant the petition for partition? Select one.
- Yes, because the right to partition is an inherent property right that cannot be waived or restricted by agreement.
- Yes, because the investor's unforeseen financial hardship provides a compelling equitable reason to set aside the agreement.
- No, because the agreement not to partition is for a reasonable duration and is supported by a legitimate purpose. (correct answer)
- No, because any agreement to waive the right of partition is permanently binding on the parties and their successors.
Explanation: The correct answer is C. While the right to partition is a fundamental attribute of co-ownership, it can be waived or restricted by an agreement among the cotenants, provided the restriction is reasonable in duration and purpose. A 20-year restriction tied to the legitimate business purpose of long-term appreciation is generally considered reasonable. (A) is incorrect because the right to partition is not absolute and can be contractually restricted. (B) is incorrect because personal financial hardship is not typically a basis for invalidating an otherwise enforceable agreement not to partition. (D) is incorrect because the restriction must be reasonable; a perpetual or unreasonably long restriction would be an invalid restraint on alienation.
Question 15
Two business partners purchased a 50-acre parcel of land as tenants in common. They could not agree on how to develop it and one filed for partition. The court determined that a partition in kind was appropriate. It divided the property into Parcel X, a 20-acre plot with valuable river frontage appraised at $300,000, and Parcel Y, a 30-acre plot with limited access appraised at $200,000. The court awarded Parcel X to one partner and Parcel Y to the other.
To ensure a fair and equitable partition, what additional order must the court make? Select one.
- Order the partner receiving Parcel X to grant an access easement across it to the owner of Parcel Y.
- Order a partition by sale, as the parcels created are not of equal value.
- Order the partner receiving Parcel X to pay owelty of $100,000 to the partner receiving Parcel Y.
- Order the partner receiving Parcel X to pay owelty of $50,000 to the partner receiving Parcel Y. (correct answer)
Explanation: The correct answer is D. When a partition in kind results in parcels of unequal value, the court can order a monetary payment, called owelty, from the cotenant who receives the more valuable parcel to the other cotenant to equalize the distribution. The total value of the property is $300,000 + $200,000 = $500,000. Each partner's equal share is $250,000. The partner who received Parcel X (value $300,000) received $50,000 more than their share. The partner who received Parcel Y (value $200,000) received $50,000 less. Therefore, the partner with Parcel X must pay $50,000 in owelty to the partner with Parcel Y. (B) is incorrect because owelty is the specific remedy to avoid a sale in this situation. (C) is an incorrect calculation based on the total difference in value. (A) might be an equitable consideration but does not address the monetary imbalance.
Question 16
A man and a woman owned a house as tenants in common. The woman's creditor obtained a valid money judgment against her. To satisfy the judgment, the creditor properly placed a lien on the woman's undivided one-half interest in the property. The creditor then filed an action seeking a judicial partition by sale of the entire property.
Is the creditor likely to succeed in the action for partition by sale? Select one.
- No, because a creditor of one cotenant cannot force a partition against the will of the non-debtor cotenant.
- No, because the creditor's only remedy is to foreclose on the woman's one-half interest, not to force a sale of the whole property.
- Yes, because a judgment creditor who has a lien on a cotenant's interest can step into the debtor's shoes and compel partition. (correct answer)
- Yes, but only if the creditor can prove that the man was unjustly enriched by the woman's failure to pay her debt.
Explanation: The correct answer is C. A judgment creditor who obtains a lien on the interest of a tenant in common acquires the right to step into the shoes of the debtor-cotenant. This includes the right to force a partition to satisfy the debt. Because the debtor-cotenant had the right to compel partition, her creditor with a valid lien has the same right. (A) is incorrect because while the non-debtor cotenant may object, their objection cannot defeat the creditor's right to partition. (B) is incorrect because forcing a partition sale is a common and permissible method for a creditor to execute on a judgment against a co-owned property interest. (D) is irrelevant to the creditor's right to partition.
Question 17
Two sisters purchased a vacation cabin as tenants in common. One sister, without consulting the other, spent $5,000 on garish renovations that, according to a real estate appraiser, actually decreased the property's market value by $10,000. The other sister sued for partition. The property sold at a court-ordered sale for $150,000.
In the accounting and division of proceeds, how should the court treat the renovations? Select one.
- Credit the renovating sister with the $5,000 cost of the renovations.
- Charge the renovating sister for the $10,000 decrease in value caused by the renovations. (correct answer)
- Disregard the renovations entirely and divide the $150,000 proceeds equally.
- Award the entire $150,000 to the non-renovating sister as damages for the unauthorized changes.
Explanation: The correct answer is B. While a cotenant who makes improvements is entitled to any value added, a cotenant who commits waste is liable for the resulting decrease in value. The unauthorized, value-decreasing renovations constitute waste. The property would have sold for $160,000 absent the waste. Therefore, in the accounting, the renovating sister should be charged for the $10,000 loss she caused. The proceeds would be divided as if the property sold for $160,000 (each getting $80,000), and then the $10,000 debit would be applied to the renovating sister's share, meaning she gets $70,000 and the other sister gets $80,000. This is achieved by charging her for the decrease. (A) is incorrect as she added no value. (C) is incorrect as it ignores the waste. (D) is punitive and incorrect.
Question 18
Three individuals, X, Y, and Z, owned a parcel of land as joint tenants with right of survivorship. X conveyed her interest to A. Subsequently, Y died, leaving a will that devised all of his property to his spouse. A then filed an action for partition.
What are the respective ownership interests of A, Z, and Y's spouse in the property at the time the partition action is filed? Select one.
- A owns one-third, Z owns one-third, and Y's spouse owns one-third, all as tenants in common.
- A owns one-third as a tenant in common, and Z owns two-thirds as the sole surviving joint tenant. (correct answer)
- A owns one-third as a tenant in common, Z owns one-third as a tenant in common, and Y's spouse owns one-third as a tenant in common.
- A and Z each own one-half as tenants in common, and Y's spouse takes nothing.
Explanation: The correct answer is B. X's conveyance to A severed the joint tenancy as to X's one-third interest. A became a tenant in common with Y and Z. However, the joint tenancy between Y and Z remained intact for their two-thirds interest. When Y died, his interest automatically passed to Z by right of survivorship. Y's will is ineffective to transfer his interest in the joint tenancy property. Therefore, at the time of the partition action, A holds a one-third interest as a tenant in common, and Z holds a two-thirds interest (her original one-third plus Y's one-third). Y's spouse takes no interest in the property. A, as a tenant in common, has the right to partition.
Question 19
Two siblings inherited a single-family house from their parent as tenants in common. One sibling lives in the house and wishes to continue doing so. The other sibling lives in another city and wants to sell the property to access their share of the inheritance. After failing to reach an agreement, the out-of-town sibling filed an action for partition.
What is the most likely outcome of the partition action? Select one.
- The court will deny the partition because the resident sibling's right to occupy the premises supersedes the other's right to partition.
- The court will order a partition in kind, physically dividing the house into two separate living units for each sibling.
- The court will order a partition by sale, with the proceeds to be divided between the siblings according to their interests. (correct answer)
- The court will order the resident sibling to purchase the other sibling's interest at fair market value within a reasonable time.
Explanation: The correct answer is C. A tenant in common has a nearly absolute right to seek partition. Courts prefer partition in kind (physical division) but will order a partition by sale if physical division is impractical, not feasible, or would result in great prejudice to the owners. A single-family house cannot be practicably divided into two separate, equivalent parcels. Therefore, the court will order a sale and divide the proceeds. (A) is incorrect because the right to partition is a fundamental right of co-ownership and is not defeated by another cotenant's desire to occupy the property. (B) is incorrect because physically dividing a typical single-family house is not feasible. (D) is incorrect because while a court might facilitate a buyout, it cannot compel one cotenant to purchase another's interest; the primary remedy when division is not possible is a public sale.
Question 20
A brother and sister own a house as tenants in common. The brother has exclusively occupied the house for the past two years by mutual agreement, while the sister lives elsewhere. During his occupancy, the brother paid $12,000 in property taxes and spent $8,000 on a necessary new furnace after the old one failed. The sister contributed nothing. The sister now files for partition. The fair rental value of the property is $1,500 per month. There was no ouster.
In the partition action, what adjustment for the past two years of expenses and occupancy is most appropriate before the sale proceeds are divided? Select one.
- The brother is credited $20,000 for the expenses, and this amount is deducted from the sister's share of the proceeds.
- The brother is credited $10,000, representing the sister's 50% share of the necessary expenses he paid. (correct answer)
- The brother's credit for expenses is fully offset by the $36,000 fair rental value of his occupancy, so the sister receives an additional credit.
- No adjustments are made because the brother's benefit of free occupancy is presumed to be equivalent to his payment of expenses.
Explanation: The correct answer is B. A cotenant who pays for necessary expenses, such as property taxes and essential repairs (like a new furnace), is entitled to contribution from the other cotenants for their pro-rata share. The total necessary expenses were $12,000 (taxes) + $8,000 (furnace) = $20,000. The sister's 50% share is $10,000. The brother is entitled to a credit for this amount. (C) and (D) are incorrect because a cotenant in exclusive possession is generally not liable for rent to the non-occupying cotenant unless there has been an ouster or an agreement to the contrary. Since there was no ouster, the brother does not owe the sister for the rental value of his occupancy. (A) is incorrect because the brother is only entitled to contribution for the sister's half of the expenses, not the full amount.