## Facts

- Two couples acquired a Lake Tahoe vacation home as tenants in common, each holding a 50% undivided interest.
- Successors to one couple’s interest entered a tenancy-in-common (TIC) agreement with the other cotenants to define rights and duties.
- The TIC agreement included a right of first refusal requiring a selling cotenant, upon receipt of a bona fide third-party offer, to give the other cotenant the first opportunity to buy on specified terms.
- LEG Investments acquired the 50% interest subject to the TIC agreement and disputes developed between the cotenants regarding use and maintenance.
- LEG received a bona fide third-party offer to buy LEG’s 50% interest, tendered the offer to the Boxlers under the right of first refusal, and the Boxlers declined.
- The third-party buyer later withdrew after refusing to accept the Boxlers as cotenants, leaving LEG unable to sell its interest.
- After the Boxlers refused either to sell the entire property or to buy LEG’s share, LEG sued for partition by sale.

## Issues

1. Whether a right of first refusal in a TIC agreement constitutes an express or implied waiver of the statutory right to partition, or instead only regulates the manner or timing of partition.
2. Whether LEG satisfied the right-of-first-refusal condition such that it retained the right to seek partition by sale.
3. Whether the attorney’s fee award to the Boxlers was proper given the correct interpretation of the TIC agreement and the partition claim.

## Decision

- The Court of Appeal reversed the judgment.
- The right of first refusal did not permanently waive the statutory right to partition; it conditioned sale procedures and thus modified, rather than eliminated, the right.
- LEG complied with the right of first refusal by offering the Boxlers the opportunity to purchase on the terms of a bona fide third-party offer, which the Boxlers rejected.
- The trial court erred by granting summary adjudication for the Boxlers on waiver defenses and by denying LEG summary adjudication on its partition claim.
- The attorney’s fee award to the Boxlers was reversed because it rested on an erroneous judgment.

## Legal Principles

- California law strongly protects a cotenant’s statutory right to partition; contractual restraints on partition are narrowly construed.
- A right of first refusal ordinarily operates as a procedural condition on transfer, not as an indefinite bar to partition absent clear waiver language and reasonable limits.
- Once a cotenant honors the right of first refusal by presenting the other cotenant the chance to purchase on the terms of a bona fide third-party offer, the cotenant may pursue partition.
- Withdrawal of a third-party offer after the non-selling cotenant declines to purchase does not negate prior compliance with the right-of-first-refusal condition.

## Conclusion

The court held that the TIC agreement’s right of first refusal did not extinguish partition rights; because LEG satisfied the contractual condition by tendering a bona fide offer to the Boxlers, LEG retained the statutory right to seek partition by sale, requiring reversal of the waiver ruling and the related attorney’s fee award.


LEG Invs. v. Boxler, 183 Cal. App. 4th 484, 107 Cal. Rptr. 3d 519 (Cal. Ct. App. 2010)