How to Sell Your Share of Real Estate if the Co-Owner’s Share is Under Arrest
The process of alienating a share in the right of common fractional ownership is often blocked at the stage of notarization of the transaction. The main reason is the presence of unfulfilled debt obligations of the second co-owner, which leads to the imposition of an arrest on their property.
In practice, owners of “clean” shares face technical and legal collisions when interacting with state registers, which makes the direct sale of the asset impossible without preliminary procedural actions.
Entry Point of the Problem: Conflict of Registers and Notary Refusal
A critical failure of the process occurs at the moment of applying to a notary. Before certifying a sale and purchase agreement, the notary is obliged to generate an extract from the State Register of Property Rights to Immovable Property (DRRP).
The notary is obliged to verify the absence of a prohibition on alienation or arrest of property using the DRRP in accordance with sub-clause 2.1, clause 2, chapter 2, section II of the Procedure for Performing Notarial Acts by Notaries of Ukraine (Order of the Ministry of Justice No. 296/5).
The main misconception of owners is that the arrest of a co-owner’s share allegedly deprives them of all rights to the object, including the pre-emptive right of purchase. This is not true.
The arrest restricts exclusively the right to dispose of the property, but not the right to acquire it. The debtor retains the pre-emptive right to purchase the share being sold.
Legal Nature of the Blocking Mechanism
The problem of alienation arises due to an architectural conflict between two state databases: the Automated System of Executive Proceedings (ASVP) and the DRRP.
The ASVP operates with subjects (debtors). The executor issues a resolution on the arrest of all property of a specific person. The DRRP operates with objects (real estate). When registering an encumbrance, the system often blocks the object entirely by its Real Estate Object Registration Number (RNONM), ignoring the fact that the debtor owns only an ideal share.
The notary has no authority to independently interpret the executor’s resolution contrary to the DRRP data. Even if there are title documents confirming the purity of the seller’s share, the presence of a global arrest on the object makes the notarization of the transaction impossible.
Situation Development Algorithm (Decision Tree)
The procedural scenario depends on how the encumbrance is entered into the register and what the status of joint ownership is.
| Blocking Scenario | Status in the DRRP System | Owner’s Action Algorithm |
|---|---|---|
| Arrest imposed by the debtor’s INN (Tax ID) | The encumbrance is registered exclusively against the debtor’s ideal share. The seller’s share is legally “clean”. | Send a notarized statement of intent to sell the share to the debtor. Wait 1 month. In the absence of a response, sell to a third party. |
| Arrest imposed by RNONM (on the entire object) | The system issues a global prohibition on the alienation of the entire real estate object. The notary refuses the transaction. | Obtain a written refusal from the notary. File a lawsuit in court to recognize the right of ownership and release the property from arrest. |
| Joint ownership of spouses | The property is registered to the debtor spouse. The share of the second spouse is not legally allocated in the register. | File a lawsuit to recognize the right of ownership to 1/2 of the ideal share with a simultaneous demand to release it from arrest. |
Each of the scenarios requires strict compliance with procedural norms to minimize the risk of the transaction being invalidated in the future.
The right of a person who is not a debtor to apply to the court with a lawsuit to recognize the right of ownership to property and release it from arrest is enshrined in Part 1 of Article 59 of the Law of Ukraine “On Executive Proceedings”.
Practical Reality and Procedural Deadlines
Formal deadlines established by law are in practice subject to significant adjustments due to procedural delays and the actions of the parties.
| Procedure Stage | Real Deadlines | Delay Factors |
|---|---|---|
| Diagnostics of the status in the DRRP | 1–2 hours | Technical maintenance work in the register. |
| Implementation of the pre-emptive right | 1 month + time for postal delivery | Evasion of the debtor from receiving the notarized letter. The period is calculated from the moment of delivery. |
| Judicial release of the share from arrest | 3–6 months (first instance) | Court workload, failure of defendants (debtor and exactor) to appear, postponement of hearings. |
If the debtor evades receiving the letter with the buyout offer, the notary records the fact of proper dispatch and return of correspondence after the expiration of the storage period. After that, a transaction with a third party becomes possible.
Matrix of Procedural Risks
Attempts to accelerate the alienation process by bypassing established procedures generate critical risks for the seller and the new buyer.
| Risk Type | Occurrence Trigger | Consequences | Protection Method |
|---|---|---|---|
| Sale without notifying the debtor | Ignoring the requirements of Art. 362 of the Civil Code of Ukraine. | The debtor has the right within 1 year to file a lawsuit to transfer the rights and obligations of the buyer to themselves. | Mandatory notarized notification of the debtor with an inventory of the enclosure. |
| Incorrect jurisdiction of appeal | Filing a complaint against the actions of the executor instead of a lawsuit to release the arrest. | Court refusal, as the co-owner is not a party to the executive proceedings. Loss of time. | Filing a lawsuit in the order of claim proceedings (defendants: debtor and exactor). |
| Price reduction upon sale | Sale to a third party cheaper than offered to the debtor. | Invalidation of the sale and purchase agreement. | Sale strictly at the price stated in the notification or higher. |
If the debtor accepts the offer and buys out the share, the newly acquired part automatically falls under the effect of the arrest previously imposed on them. In addition, there is a risk of the transaction being challenged by the exactor, since the debtor directed funds to purchase an asset, and not to repay the debt.
Procedural Traps and Owner Errors
The most common mistake of lawyers and owners is an attempt to release their share from arrest by filing a complaint against the actions of the state executor to the head of the State Executive Service (DVS) or to the court in the order of control over the execution of court decisions.
According to the Resolution of the Civil Cassation Court of the Supreme Court dated June 29, 2023, in case No. 208/9810/21, a person who is not a debtor cannot protect their rights by appealing the actions of the executor. The only proper way of protection is filing a lawsuit to release the property from arrest.
The second common mistake concerns the property of spouses. If an apartment was acquired in marriage, but the title owner is the debtor spouse, it is impossible to sell “one’s half” without preliminary judicial procedures.
The Resolution of the Supreme Court dated December 19, 2023, in case No. 711/744/23 confirms the illegality of the realization of a share of the joint property of spouses without the consent of the other and without preliminary allocation of shares in kind or recognition of the right to an ideal share.
Conclusion
The presence of an arrest on a co-owner’s share is not an absolute obstacle to the alienation of your part of the real estate, but it requires an accurate legal qualification of the type of blocking in the DRRP. With a local arrest (by INN), it is sufficient to comply with the procedure of the pre-emptive right of purchase. With a global arrest (by RNONM), the only legitimate way is claim proceedings to release the property of a person who is not a debtor from arrest.
FAQ
Is it possible to sell my share if my brother’s share is under arrest?
Yes, it is possible if the arrest in the DRRP is imposed exclusively on his share (by INN), and you have complied with the procedure of his pre-emptive right of purchase in accordance with Art. 362 of the Civil Code of Ukraine.
Do I need to offer the debtor to buy out my share if their accounts are blocked?
Yes, the fact of the presence of arrests and debts does not deprive the co-owner of the pre-emptive right of purchase. Notification is a mandatory procedural step.
What should I do if the executor arrested the entire apartment due to the co-owner’s debts?
It is necessary to file a lawsuit in court to recognize the right of ownership and release your share from arrest. The defendants in such a lawsuit will be the debtor and the exactor.
Is it possible to simply write a complaint against the executor to the head of the DVS to correct an error in the register?
No. A person whose rights are violated by an arrest, but who is not a debtor in executive proceedings, must protect their rights exclusively by filing a full-fledged lawsuit.
What will happen if the debtor agrees to buy my share?
The transaction may take place, however, the share purchased by them will immediately fall under their current arrest. There is also a high risk that the exactor will challenge this transaction.
How to sell half of an apartment if it was bought in marriage but registered to the debtor husband?
First, it is necessary to allocate your 1/2 ideal share through the court and, within the framework of the same judicial process, release it from arrest. Until this moment, the notary will not certify the transaction.
How long to wait for a response from the debtor after sending a notification of sale?
The law allocates exactly 1 month from the day the letter is delivered to the debtor. If the letter is returned after the expiration of the storage period, the notary can also certify the transaction.
Can the notary themselves release my share from arrest if I show a deed of gift for my part?
No, the notary has no authority to interpret the resolutions of the executive service contrary to the data contained in the DRRP. The removal of a global arrest is possible only by a court decision.
What to do if the debtor evades receiving the letter with the buyout offer?
The notary records the fact of proper dispatch of correspondence. After the letter is returned by the postal service upon expiration of the storage period, the procedure is considered complied with.
Who is the defendant in a lawsuit to release a share from arrest?
The defendants are the debtor and the person in whose interests the arrest was imposed (exactor). The executive service is involved as a third party.
The information is of an analytical nature and does not constitute individual legal advice.
Reprinting is permitted only with the written permission of the editorial board.
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