Home Table of Contents

RULE 12-409. PARTITION BY SALE

West's Annotated Code of MarylandMaryland RulesEffective: July 1, 2023

West's Annotated Code of Maryland
Maryland Rules
Title 12. Property Actions
Chapter 400. Partition
Effective: July 1, 2023
MD Rules, Rule 12-409
RULE 12-409. PARTITION BY SALE
Currentness
(a) Generally. If the court orders a partition by sale of property, the sale shall be an open-market sale unless the court finds that a sale by sealed bids or an auction would be more economically advantageous and in the best interest of the cotenants as a group.
(b) Open-Market Sale
(1) Selection of Broker. If the court orders an open-market sale, the court, by order, shall appoint a real estate broker licensed in the State to offer the property for sale. No later than ten days after the order for open-market sale is entered, the parties may submit to the court a written stipulation of the name of a qualified broker, and the court shall appoint that broker. If no broker is timely selected by the parties, the court shall appoint a disinterested, qualified broker.
(2) Order of Appointment of Broker. The order of appointment shall require the broker to offer the property for sale in a commercially reasonable manner for at least the fair market value as determined in accordance with Rule 12-406. The order shall establish a reasonable commission for the broker and set such other terms and conditions as the court may require.
(3) Reporting Requirements for Court-Appointed Brokers
(A) Generally. A real estate broker appointed under section (b) of this Rule to offer property for open-market sale shall file a report with the court no later than seven days after receiving an offer to purchase the property.
(B) Contents of Report. A report to the court required by subsection (b)(3)(A) of this Rule shall contain at least the following:
(i) a description of the property to be sold to each buyer;
(ii) the name of each buyer;
(iii) the proposed purchase price, and if the proposed purchase price is less than the fair market value established by the court pursuant to Rule 12-406, a justification, if any, for why the court should consider accepting the lower price;
(iv) the terms and conditions of the proposed sale, including the terms of any owner financing;
(v) the amounts to be paid to lienholders;
(vi) a statement of contractual or other arrangements or conditions of the broker's commission; and
(vii) other material facts relevant to the sale.
A report filed under this subsection shall be sealed until the next status hearing is held by the court pursuant to subsection (b)(5) of this Rule.
(4) Offers to Purchase
(A) Fair Market Value Offers Received in Reasonable Time. If the real estate broker appointed under this section obtains an offer to purchase the property, the broker shall comply with the reporting requirements in subsection (b)(3) of this Rule and the sale may be completed in accordance with the applicable State laws after a hearing is held pursuant to subsection (b)(5) of this Rule.
(B) No Fair Market Value Offers Received in Reasonable Time. If the real estate broker appointed under this section does not obtain an offer to purchase the property for at least the fair market value in a reasonable time, the court, after a hearing held pursuant to subsection (b)(5) of this Rule, may: (i) approve the highest outstanding offer, if any; (ii) re-determine the fair market value of the property and order that the property continue to be offered for an additional period of time; or (iii) order that the property be sold by sealed bids or at an auction.
(5) Status Hearing
(A) Conduct of Hearing. After the property has been offered for sale for a period of time determined by the court, the court shall hold an evidentiary hearing during which the court shall: (i) review each pending offer to purchase the property, if any; and (ii) take testimony from each cotenant that wishes to testify and any other witness called by a party that the court determines necessary to its consideration of the status of the property's listing for sale.
(B) Post Hearing. After the hearing, the court shall issue an order: (i) directing the broker to accept a pending offer, (ii) extending the time for the broker to offer the property for sale at the existing listing price or at a lower price specified by the court, or (iii) directing the property to be sold by sealed bids or auction.
(C) Post Open Market Sale Procedures. If open market sale is approved, the real estate broker appointed by the court to conduct the open market sale of the property shall proceed in accordance with State law other than Code, Real Property Article, Title 14, Subtitle 7.
Cross reference: See Code, Real Property Article, § 14-711.
(c) Sale by Sealed Bids. If the court orders a sale by sealed bids, the court shall issue an order establishing the terms and conditions of the sale. The procedures set forth in Title 14, Chapter 300 of these Rules shall apply to the sale.
(d) Sale by Auction. If the court orders a sale by auction, the court shall issue an order establishing the terms and conditions of the sale. The procedures set forth in Title 14, Chapter 300 of these Rules shall apply to the sale.
(e) Purchaser's Share of Proceeds. If a purchaser is entitled to a share of the proceeds of the sale, the purchaser also is entitled to a credit against the price in an amount equal to the purchaser's share of the proceeds.
Cross reference: See Code, Real Property Article, §§ 14-711 and 14-712.
Source: This Rule is new.

Credits

[Adopted April 1, 2023, eff. July 1, 2023.]
MD Rules, Rule 12-409, MD R PROP ACT Rule 12-409
Current with amendments received through February 1, 2024. Some sections may be more current, see credits for details.
End of Document