This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Limitations of some sort, are imposed upon the power of a co-tenant to acquire an interest, adverse to that of the remaining co-tenants so as to exclude them from the property in which their interests in common exist, in spite of their willingness to contribute to the expense of acquiring such adverse interest. The exact nature of these limitations is a matter of some doubt; and this arises in part out of a failure to agree upon the fundamental theory. The reason for this rule is variously suggested as the relation of trust and confidence between tenants in common; the especial community of estate arising where the estates are created at the same time and by the same instruments; and the fact that the tenant who acquires such interest is usually in possession of the property, and usually has funds belonging to the other co-tenants which he should have applied to the discharge, for the benefit of all, of the encumbrance which he is attempting to acquire as his own. It is quite possible that this last reason is the true reason, which should explain all cases except those in which there actually is trust and confidence between the tenants in common; but that, by a mistaken analogy, it has been extended, in some jurisdictions, to cover cases in which the tenant who has acquired the interest, adverse to his co-tenants, is not in possession, has no funds in his hands belonging to his co-tenants, and is not in relations of trust and confidence with them.
14Yeoman v. Lasley, 40 O. S. 190; Gates v. Paul, 117 Wis. 170, 94 N. W. 55.
15Newell v. Cochran, 41 Minn. 374, 43 N. W. 84; Grant v. Hardy, 33 Wis. 668.
16Bartlett v. Smith, 1 Neb. Rep. (unofficial) 328, 95 N. W. 661.
17Bartlett v. Smith, 1 Neb. Rep. (unofficial) 328, 05 N. W. 661..
18 Sargent v. Blake, 160 Fed. 57, 17 L. R. A. (N.S.) 1040, 87 C. C. A. 213.
19Sargent v. Blake, 160 Fed. 57, 17 L. R. A. (N.S.) 1040, 87 C. C. A. 213.
20 Elliott v. Bidwell, 35 S. D. 370, 152 N. W. 286.
"It is well settled that co-tenants stand in a certain relation to each other of mutual trust and confidence; that neither will be permitted to act in hostility to the other in reference to the joint estate; and that a distinct title acquired by one will enure to the benefit of all."1 A co-tenant who buys an encumbrance upon a property which is owned in common, purchases for the benefit of the other tenants in common if they choose to contribute within a reasonable time.2 This right of election is given in order to prevent the tenant, who has purchased the adverse interest or encumbrance, from taking advantage of his co-tenants. It is not given in order to allow the co-tenants to take advantage of the purchaser. In order to take advantage of the purchase by one co-tenant for the benefit of all, the remaining co-tenants must elect to contribute within a reasonable time after they have notice of the facts.3
1United States. Turner v. Sawyer, 150 U. S. 578, 586, 38 L. ed. 1189; to the same effect see Bissell v. Foss, 114 U. S. 252, 29 L. ed. 126.
Alabama. Bracely v. Noble, 77 So. 368.
Colorado. Franklin Mining Co. v. O'Brien, 22 Colo. 129, 55 Am. St. Rep. 118, 43 Pac. 1016; Mills v. Hart, 24 Colo. 505, 65 Am. St. Rep. 241, 52 Pac. 680.
Illinois. Boyd v. Boyd, 176 111. 40, 68 Am. St. Rep. 169, 51 N. E. 782; Biggins v. Dufficy, 262 111. 26, 104 N. E. 180; Kent v. Barger, 264 111. 59, 105 N. E. 741.
Mississippi. Freeman v. Freeman, 107 Miss. 750, 66 So. 202.
Montana. O'Hanlon v. Ruby Gulch Mining Co., 48 Mont. 65, 135 Pac. 913.
Pennsylvania. Lloyd v. Lynch, 28 Pa. St. 419, 70 Am. Dec. 137.
Tennessee. Davis v. Solari, 132 Tenn. 225, 177 S. W. 939.
Vermont. Downer v. Smith, 38 Vt. 464.
Washington. Cedar Canyon, etc., Co. v. Yarwood, 27 Wash. 271, 67 Pac. 749; Dwight v. Waldron, 96 Wash. 156, 164 Pac. 761.
West Virginia. Cecil v. Clark, 44 W. Va. 659, 30 S. E. 216.
See, Some Neglected Principles in the
Purchase of Real Estate by One of Several Co-Owners, by Fred L. Gross, 24 Yale Law Jour. 317.
2United States. Rothwell v. Dewees, 67 U. S. (2 Black.) 613, 17 L. ed. 309.
Arkansas. Inman v. Quirey, 128 Ark. 605, 194 S. W. 858.
California. Stevenson v. Boyd, 153 Cal. 630, 19 L. R. A (N.S.) 525, 96 Pac. 284.
Illinois. Kent v. Barger, 264 111. 59, 105 N. E. 741.
Iowa. Clark v. Watson, 180 la, 721, 159 N. W. 761.
Kansas. Watson v. Williams, 175 Pac. 96.
Kentucky. Stamps v. Frost, 179 Ky. 418, 200 S. W. 609.
Washington. Dwight v. Waldron, 96 Wash. 156, 164 Pac. 761.
West Virginia. James v. James, 77 W. Va. 229, 87 S. E. 364.
3Kentucky. Stamps v. Frost, 179 Ky. 418, 200 S. W. 609.
Missouri. Brown v. Howard, 264 Mo. 466, 175 S.W. 52.
South Dakota. Stianson v. Stianson, son (S. D.), 167 N. W. 237.
Washington. Dwight v. Waldron, 96 Wash. 156, 164 Pac. 761.
West Virginia. Abbott v. Williams, 74 W. Va. 652, 82 S. E. 1097; James v. James, 77 W. Va. 229, 87 S. E. 364.
They can not wait more than a reasonable time in order to speculate on the outcome of the purchase;4 and a delay in contributing beyond a reasonable time will operate as an election to permit the purchaser to acquire for his own use, and to hold, free from the interests of his co-tenants.5
A tenant in common may purchase, free from the interests of his co-tenants, at a public judicial sale where no undue or unfair advantage of his co-tenants is taken.6 If he takes an unfair advantage of his co-tenants, he may be held as trustee.7 If a judgment is a lien upon the interest of a tenant in common A, and B, one of the other tenants in common, enters into a conspiracy with such judgment creditor, as a result of which such realty is sold at execution sale, and is bought in by a stranger for the benefit of B to the exclusion of A, such sale will enure to the benefit of B.8 Where two co-tenants, A and B, bought of C and as part of the purchase price assumed a debt due from C to X, and A made default in paying such debt by reason of which the property was sold to Y, who conveyed to A's son, it was held that as it appeared that A's son was advancing the money for the property as a loan to his father, and took the title in his own name for security, A held B's original interest in the property in trust for B.9