Category Archives: Property law

A person who jointly owns real estate can generally demand dissolution of the co-ownership. Partition disputes frequently follow separation, inheritance between siblings, or a decision to stop jointly using property acquired together.

A partition action can have substantial consequences for the other owner. If physical partition is impossible, it may end in a judicial auction.

However, such an action does not always succeed. Statute, earlier agreements and case law provide ways to resist partition at least temporarily and, in some cases, prevent an auction.

A distinction is essential: some objections prevent dissolution itself; others merely require physical partition or condominium ownership instead of a sale.

1. Can any co-owner bring a partition action?

Generally, yes. Section 830 ABGB gives each co-owner a right to demand dissolution. Normally, no special reason for wishing to leave the ownership community is necessary. Unlike many proceedings, the wish to end co-ownership is generally sufficient.

The right is not unlimited. The statute expressly identifies an inopportune time (Unzeit) and detriment to the others (Nachteil der Übrigen). Owners may also have agreed to continue the community or waived partition.

Case law confirms that the defendant generally must allege and prove the specific facts establishing an obstacle. A general assertion that partition would be unfair or financially disadvantageous is insufficient.

2. When can partition be resisted because the time is inopportune?

The Supreme Court understands this as an objective circumstance outside the owners themselves, generally affecting all equally, which makes partition inappropriate and harmful at that particular time. A temporary situation in which no reasonable price could be obtained is a classic example.

The condition must be temporary: removal or cessation of the obstacle in the near future must be foreseeable. Many objections fail here.

A condition whose end cannot be foreseen normally cannot block partition indefinitely. Nor is it sufficient that a sale is personally inconvenient or an owner wishes to keep the property. An urgent housing need therefore does not automatically require dismissal on this ground.

3. What does detriment to the others mean?

This is distinct from inopportune timing and can include an individual owner's personal or financial circumstances. However, an individual disadvantage postpones partition only where a comprehensive balancing of interests shows that the affected owner's interest temporarily outweighs the other's interest in immediate partition.

The disadvantage must generally be temporary. Lasting or unavoidable harm that would accompany any later partition cannot normally block the statutory right indefinitely.

The owner relying on this must explain the threatened harm, why it is particularly serious now and, crucially, when it is expected to end. The Supreme Court has expressly reaffirmed these principles.

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If you have been served with a partition claim or another owner threatens proceedings, have possible obstacles assessed early. Contact me at +43 1 295 4251 or office@maydell-law.at.

4. Can a continuation agreement prevent partition?

Section 831 ABGB is particularly important. Co-owners can agree to continue the community. A person validly bound by such an agreement cannot simply demand dissolution at any time.

The agreement need not expressly use the words “waiver of partition” or “waiver of a partition action”. The obligation may, in the circumstances, be implied by the agreement and its purpose.

Examine not only the land register but also earlier purchase, gift, estate-division, marriage and divorce agreements and other arrangements. A usage agreement alone does not automatically waive dissolution: the precise terms and recognisable purpose matter.

The defendant generally must prove that a continuation agreement was made. Even where established, early dissolution may exceptionally be possible for an important reason making continued co-ownership unreasonable. Case law treats the arrangement in this respect as a continuing contractual relationship.

5. Can a waiver even prevent condominium ownership?

Yes. In 5 Ob 25/25z of 23 September 2025, the Supreme Court clarified that a sufficiently comprehensive continuation obligation can also prevent dissolution by establishing condominium ownership.

The parties had implemented their mother's wish to preserve the property in its existing form and agreed mutual prohibitions on sale and encumbrance. The Court treated the resulting continuation obligation as a comprehensive obstacle covering a co-owner's request for condominium ownership.

Condominium ownership is therefore not always a way around an existing continuation agreement. The scope and purpose of the original commitment are decisive.

Even such an obligation need not last forever in all circumstances. A sufficiently weighty important reason making continuation unreasonable may permit early dissolution.

6. Does a prohibition on sale and encumbrance prevent an action?

Care is needed. A registered prohibition under section 364c ABGB does not automatically prevent a partition claim.

In 5 Ob 69/25w of 3 June 2025, the Supreme Court reaffirmed that a prohibition registered only against one owner's share generally does not prevent another co-owner from demanding dissolution.

A prohibition covering the entire property for the same beneficiary is different and can matter particularly when enforcement of dissolution is later authorised.

Often the more important question is why the prohibition was agreed. Its terms may also show that the owners did not intend unilateral dissolution. A contractual partition waiver or continuation agreement may lie behind it.

Reading the land register alone is therefore insufficient: inspect the underlying contract. In 5 Ob 69/25w, for example, mutual prohibitions between spouses were generally treated as a waiver of the otherwise unconditional right to partition. Partition was nevertheless possible because an important reason justified ending that commitment early.

7. Can physical partition or condominium ownership prevent an auction?

It may be impossible to preserve the existing co-ownership yet possible to avoid auctioning the entire property.

Physical partition generally takes priority over partition by sale. Under section 843 ABGB, auction is available only if the asset cannot be divided, or cannot be divided without substantial loss of value.

For suitable buildings, establishing condominium ownership can be a particular form of physical partition. Section 3(1)(3) WEG 2002 expressly allows this by judicial decision in co-ownership dissolution proceedings.

This form must be feasible and appropriate in the individual case. Merely having several rooms or theoretical units is insufficient. Building and legal requirements, the nature of the resulting units, allocation to ownership shares, and conversion or equalisation costs must be considered. The Supreme Court also addressed these requirements in 5 Ob 129/25v of 12 March 2026.

A defendant opposing a sale with the possibility of condominium ownership must generally raise it in first-instance proceedings. If it proves feasible and appropriate, a claim solely for partition by sale may fail unless the claimant adapts it.

Condominium ownership does not necessarily prevent every form of dissolution, but may avoid the more intrusive auction of the entire property.

8. What should be examined after service of a partition claim?

Do not have only the claim reviewed. Important documents include:

• the claim and all exhibits;
• current and, where relevant, historical land register extracts;
• the original purchase, gift or transfer contract;
• agreements between the co-owners;
• marriage, divorce or estate-division agreements;
• contracts concerning prohibitions on sale or encumbrance and pre-emption rights;
• usage agreements;
• correspondence and emails about shared use and the purpose of co-ownership;
• investment, conversion and financing records;
• building plans, unit-value reports and other evidence of possible physical partition or condominium ownership.

Older contracts often contain provisions that appear unrelated to partition but may be decisive for a waiver or continuation obligation.

9. Can a partition action really be prevented?

Yes, but not simply because you wish to keep the property. Statutory obstacles involving inopportune timing or detriment may provide temporary protection. A valid continuation agreement or waiver may provide a more extensive defence.

For registered prohibitions, examine both their effect as property rights and whether the underlying agreement also contains a waiver.

Even if dissolution cannot be prevented, feasible physical partition or condominium ownership may avoid a judicial auction. The available options depend on land register entries, contracts, the history of co-ownership and the property's actual condition.

Free initial assessment — call now

Have you been served with a partition claim, or is another owner demanding dissolution?

I represent co-owners both pursuing and defending partition, examining waivers, continuation agreements, sale and encumbrance prohibitions, and the feasibility of physical partition or condominium ownership.

Contact me for a free initial assessment. If a claim has already been issued, have it, a current land register extract and key property contracts ready if possible.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 295 4251
Email: office@maydell-law.at

This article provides a general overview and does not replace individual assessment. Whether and how partition or an auction can be prevented depends particularly on land register entries, co-owner agreements and the specific circumstances.

This article explains the essentials of auctions of property or apartments jointly owned by several people. Experienced property lawyer Mag. Patrick Maydell, LL.M. offers practical tips and information.

Houses often belong to several people, and apartments to spouses or siblings. Siblings may have inherited a house together; spouses may have bought or built a property and wish to sell following divorce. If the co-owners cannot agree on a sale, a judicial auction may result.

1) How does a property auction work in detail?

A final judgment or binding court settlement, no longer open to appeal, is required. This typically follows a partition action in which the co-owners settled or the judge issued a judgment that was not challenged. For the conditions for a successful partition action, see Partition actions: 9 tips from a lawyer.

With a judgment or settlement, the auction is initiated by an enforcement application to the competent district court. Even if the partition proceedings took place in a regional court, the auction always takes place in the district court for the property's location.

Once enforcement is authorised, an expert values the property so the court can set a minimum bid. The court chooses and appoints the expert. Parties may comment, including raising reasons against the appointment, such as previous work for the other co-owner. The court may appoint someone else if appropriate.

The expert conducts an on-site inspection with the parties and their lawyers, takes photographs, examines the rooms and obtains necessary documents from the building authority.

The court sets the deadline for the report, usually four to eight weeks. Once submitted, the court sends it to the lawyers, who may comment and identify errors. The report also reveals the proposed minimum auction price.

2) What is the minimum price?

The minimum price is the market value. Contrary to popular belief, an auction following partition therefore does not normally involve a sale below market value, unlike an ordinary enforcement auction initiated by a bank for unpaid debt. Section 352a(3) EO sets the minimum bid at the appraised value, meaning market value.

In practice, properties auctioned after partition frequently sell above market value. Co-owners therefore need not suffer a financial disadvantage compared with a private sale.

If they disagree with the expert's figure, the co-owners can unanimously agree a higher minimum, or a lower one if they believe the valuation is too high to attract buyers. However, the minimum must not fall below three quarters of the expert's appraised value. Usually the expert's figure is retained because the owners cannot agree.

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3) What happens at the auction hearing?

The auction takes place at the district court, usually in a larger courtroom. Each prospective buyer shows identification, completes a form and presents a savings passbook containing at least the required security deposit, the Vadium. This prevents frivolous bidding without payment.

An existing co-owner may also bid. If a half-owner wishes to acquire the other half and succeeds, they need not pay the full purchase price for an interest they already own, but only the price attributable to the other half.

The judge awards the property to the highest bidder. The buyer then pays the purchase price into the court's escrow account. Once it has arrived in full, the court informs the co-owners' lawyers. The property is subsequently handed over, including the keys.

4) How are the proceeds distributed?

Before payment, the judge attempts to secure agreement between the parties. If they cannot agree, the court decides according to the relevant criteria.

Proceeds are generally distributed according to ownership shares; two equal co-owners each receive half. This can differ where one owner made investments or shares are unequally burdened by loans or mortgages, for example one unencumbered half and one mortgaged half.

5) What about investments by a co-owner?

An exception to distribution by registered shares applies to investments capable of increasing the property's value and benefiting the other owner.

For example, one owner builds a garage at their own expense with the other's consent. If it can increase the property's value and auction proceeds, the other owner would benefit without having contributed. The investing owner may ask the court to account for that investment and receive a larger amount.

It is not necessary to show that the particular buyer actually paid more because of the garage. What matters is whether the investment was objectively capable of increasing the auction proceeds.

Payments or claims arising from co-ownership but unrelated to the amount realised cannot be taken into account. For example, unpaid operating or repair costs owed by one owner to the other must be claimed in separate proceedings.

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6) How long does it take?

The time until auction depends on several factors, including how quickly the court authorises it, when it schedules the hearing and whether an opposing co-owner delays proceedings through applications. Normally, allow approximately six to nine months, and potentially longer.

7) What happens to loans and mortgages?

Mortgages generally remain after the auction. A new buyer could therefore face enforcement by the bank if the former owners fail to repay their loan.

To avoid this, the outstanding loan is often repaid to the bank from the auction proceeds and the bank issues a release for deletion of the mortgage. The buyer then acquires the property free of that mortgage, while the former owners benefit from repayment of their debt.

8) What does the auction cost?

The enforcement proceedings attract a one-off court fee calculated on the amount in dispute, often a few hundred euros depending on the case. Expert valuation fees vary with complexity, such as an apartment versus a multi-unit building, but are typically EUR 2,000–4,000 in total for all owners.

Lawyers' fees depend on work required, including submissions and hearings. They are often of a similar order to the expert fees but may vary.

Court and expert fees are shared according to ownership shares. With three equal co-owners, each pays a third. Unlike first-instance partition litigation, lawyers' fees in the enforcement proceedings are not reimbursed: each owner pays their own lawyer.

9) Do rights of residence or usufruct survive?

Yes. A right of residence or usufruct remains and must be accepted by the buyer. In practice, such a right may mean that no buyer is found.

10) Can a prohibition on sale and encumbrance prevent an auction?

A registered prohibition prevents an auction where it covers the entire property and its beneficiary does not consent. If it covers only one ownership share, for example one half but not the other, the property may nevertheless be auctioned.

11) What if the property does not sell?

If it is not sold at the first hearing, written bids may be submitted within a period of up to eight weeks afterwards. The court sets the precise deadline and publishes the details in the judicial notices database (Ediktsdatei).

Written bids may be up to 25% below the expert's appraised value. In my experience, failure to sell is uncommon, except where, for example, a right of residence burdens the property.

Free initial assessment — call now

For questions or assistance with partitioning houses, land or apartments, call for a free initial telephone assessment or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 2954251
office@maydell-law.at

Learn the essentials of partition actions first-hand: when an action succeeds, whether a judicial auction is inevitable and what it costs. Experienced property lawyer Mag. Patrick Maydell, LL.M. offers these practical tips and explanations.

1) Why do partition actions arise?

Partition actions arise when co-owners can no longer agree on the future of jointly owned property. A sole owner can generally do what they wish with their property, including selling it without anyone else's consent. A co-owner's freedom, however, is limited by the other owners' rights.

This form of ownership is often called “ordinary co-ownership” to distinguish it from condominium ownership. Each co-owner holds an undivided share in the whole property, for example one half or one third.

A common misconception is that a co-owner may sell their share only with the others' consent. Consent is not required to sell one's own share, but in practice such shares are often difficult to sell.

Selling the entire property is therefore often more promising. If the co-owners cannot agree, a partition action remains available, for example where one owner wants to sell and another does not.

2) How does a partition action work?

One or more co-owners bring the action in court. If the claimant seeks a judicial auction of the property, this is an action for partition by sale (Zivilteilung). If the aim is to divide it into independent units, this is physical partition (Realteilung).

By law, physical partition takes priority. The property must be divided into independent units if this is possible. A judicial auction is available only where physical partition is not an option.

The judge determines the appropriate form of partition on the basis of expert evidence. Where physical partition is possible, the court decides who receives each part, potentially subject to an equalisation payment.

If physical partition is impossible, the property must be auctioned. The defendant, the co-owner opposing partition, may argue that partition would be at an “inopportune time” or “to the detriment of the others”. Such obstacles to partition must be temporary, for example where impending changes to zoning would make immediate partition disadvantageous. Following a successful auction, the proceeds are distributed according to the ownership shares.

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3) Does a partition action always lead to an auction?

No. The parties are always free to settle. With houses, it may also be possible to establish condominium ownership if the building can be divided into independent residential units. Apartments, by contrast, cannot normally be divided into separate residential units, so an auction is generally to be expected.

4) Can an auction be prevented? What is the minimum price?

Partition may be postponed because of an inopportune time or detriment to the others, for example if partition would be disproportionate in view of an urgent housing need. There is no auction where physical partition or the establishment of condominium ownership is possible. Otherwise, the house must be auctioned.

Naturally, the aim is a good sale price. Contrary to popular belief, a judicial auction following a partition action does not normally involve a sale below market value, unlike an ordinary enforcement auction initiated by a bank for unpaid loans. Section 352a(3) of the Austrian Enforcement Code (EO) provides that the minimum bid is the appraised value, meaning the property's market value.

In practice, a judicial auction therefore normally has no disadvantage compared with a private sale, apart from taking longer. It may even achieve a substantially higher price, as the following example shows.

For a detailed account of the process, see Auctions of jointly owned property: the essentials.

In one of my cases, I arranged the auction, following a partition action, of a detached house on a 608 m² plot in Vienna's 14th district. It was appraised at EUR 440,000. There was considerable interest at the viewing, so we agreed with the other side to raise the minimum price to EUR 500,000.

The auction greatly exceeded that amount: the house sold for exactly one million euros. Afterwards, everyone agreed that such a price would not have been achieved in a private sale. The psychological pressure of competitive bidding at a public court auction, for example with 100 participants, should not be underestimated. It can lead the highest bidder to pay a price they would not have paid privately.

“Contrary to popular belief, a judicial auction can achieve a substantially higher price than a sale outside court.” — Mag. Patrick Maydell, LL.M., Attorney at Law

5) When can a house actually be divided?

There are three decisive requirements for physical partition: division into comparable parts, division in proportion to the ownership shares, and division without loss of value. A garden plot and a building plot with a villa, for example, are not comparable parts. Proportionate division requires as many physical parts as there are co-owners. Their relative values must approximately reflect the ownership shares; minor differences can be equalised in money.

The house must also be divisible without a substantial loss of value. Such loss exists where the whole house is objectively worth significantly more than the resulting parts, or the division would itself cause high costs and consequential expenses. Courts have regarded a 5.28% reduction as insignificant, but, for example, a 15% reduction as disproportionate.

If sufficient units suitable for condominium ownership exist or can be created without disproportionate expense, condominium ownership may also be established. In all other cases, partition by sale through a judicial auction remains available.

6) Can an apartment that we jointly own be divided?

Partition means dissolving the ownership community. Physical division into two comparable units is only feasible if the apartment can actually be split into two such residential units. Apartments are therefore generally auctioned and the proceeds distributed.

7) What are the advantages of establishing condominium ownership?

It creates independent residential units that can readily be sold. Ordinary co-ownership shares may be legally transferable, but in practice are often almost unsaleable.

For the unit-value assessment (Parifizierung), a chartered technical expert prepares a report on the relative utility value of each unit. This reflects its usable floor area and all factors that increase or reduce its value, expressed as additions to or deductions from the floor area, such as orientation within the building or floor level.

The costs include the expert report, the condominium agreement and the application for land register entry.

8) What does a partition action cost?

The successful party is entitled to reimbursement of litigation costs by the opponent. The property is generally valued using its statutory property value (Grundstückswert). A lower valuation of the claim is possible, but if the opponent challenges it, the court may increase the amount in dispute to that property value.

An example from my practice: Former partners each owned half of a detached house in Vienna. Following separation, the man sought an auction and brought a partition action against the woman.

The claim was valued at EUR 17,000, which generally formed the basis for all procedural costs. Several written submissions were necessary and there were three hearings over five months. The woman initially sought to prevent a sale, arguing that the house could be physically divided into two comparable residential units. Alternatively, she requested condominium ownership.

Extensive settlement discussions at each hearing initially failed. An expert was then appointed to assess whether the house could be divided into two comparable residential units.

The former partners eventually settled: instead of a court auction, they agreed to sell through an estate agent, each bearing their own litigation costs. The house was subsequently sold at a profit.

The defendant's total costs were EUR 5,793.46 including VAT. The claimant additionally had to pay court fees of EUR 707. Costs in other cases may be lower or higher depending on the assessment basis and work involved. I will gladly estimate the expected costs in your situation. If you win, you are entitled to recover costs from the opponent.

9) Must an expert be appointed?

For partition of a house, the judge will normally appoint an expert, as it is often impossible without expert evidence to decide whether the case-law criteria are met: comparable parts, proportionate division and no substantial loss of value. The expert also determines the appraised value used as the minimum auction bid.

The unsuccessful party ultimately bears the expert's costs.

Free initial assessment — call now

If you have questions or need legal assistance with the partition of a house, land or an apartment, call for a free initial assessment or email office@maydell-law.at.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 295 4251
office@maydell-law.at

A decision of the Austrian Supreme Court (5 Ob 120/21i) clarifies that a customer commissioning construction work may withdraw from the contract after losing trust in the contractor because delivery obligations were not fulfilled on time. Such withdrawal may even be permissible without setting a grace period.

The case concerned a consortium of construction companies commissioned to supply edge-walkway covers and supports for a new railway line. Many covers proved defective and did not meet the agreed dimensions. Far too few were delivered. The customer then set a four-week grace period for delivery of the remaining covers. During that period, an inspection of one of the consortium's factories revealed that it would be unable to supply the missing covers by the deadline. The customer therefore withdrew immediately, without waiting for the grace period to expire, and commissioned other companies to carry out substitute performance.

The consortium nevertheless considered that it had acted correctly and sued for the outstanding contract price. On final appeal, the Supreme Court held that withdrawal normally requires a reasonable grace period for the defaulting contractual partner. However, none is necessary where that party is clearly unable to remedy the failure or seriously and definitively refuses performance. A right to withdraw without a grace period also exists where one party has lost trust in the other because of conduct contrary to good faith, making continuation of the contract unreasonable.

Here, withdrawal without a further grace period was permissible because the factory inspection showed that the consortium could not deliver the agreed quantity on time: the factory did not even have the formwork needed to manufacture the covers.

This decision shows that a grace period need not always be set or allowed to expire before another business can be instructed. The conditions for withdrawal without a grace period nevertheless depend on the circumstances of the individual case.

If you face legal difficulties with building clients or construction companies, I will be pleased to provide detailed advice at my office. Contact me for an initial consultation.

Mag. Patrick Maydell, LL.M.
Attorney at Law
Neustiftgasse 17/1/9
1070 Vienna
Telephone: +43 1 2954251
office@maydell-law.at

This decision of the Austrian Supreme Court of 20 October 2020 (4 Ob 162/20g) addresses whether other co-owners may bring an eviction action against a co-owner who uses the property alone because they wish to rent it out.

The claimants initially had no objection to the defendant's exclusive use, but later withdrew their consent. There was neither a usage agreement between the parties nor a court order regulating use.

In earlier decisions, the Supreme Court held that each co-owner is generally entitled to use the property to an extent approximately corresponding to their share, provided they have a personal need for such use. Where the jointly owned asset offers only limited possibilities of use, a co-owner may, even without agreement with the others, make any use that does not interfere with their actual use (RIS-Justiz RS0013197 and RS0013211; 9 Ob 85/00s). Under these conditions, exclusive use is also permitted.

The Court therefore had to determine whether the claimants actually used the property or had a concrete wish to do so. Only interference with their use would mean that the defendant's exclusive use infringed their rights as co-owners.

On whether a wish to rent out the property amounts to a concrete wish to use it, the Supreme Court held that without a claim to use the property themselves, the defendant's exclusive use did not unlawfully interfere with the claimants' ownership rights. Wanting to rent it out is not a concrete wish to use it. Without such a wish, the claimants were therefore entitled only to usage compensation from the defendant.

If you have questions or need help with partitioning houses, land or apartments, please call to arrange an appointment or email office@maydell-law.at.