Lanefan
Victoria Rules
In part because the other characters would feel (IMO justifiably) ripped off. Sure the Pally can use it provided it belongs to all of us and we all have equal say in what becomes of it, but give it to the Pally as hers to own? Not bloody likely. And, if we carry forward the avenger that means everyone's share takes a big hit, and people might need that money to train or to buy other items more useful to them/the party.That seems odd to me. Why wouldn't they just give it to the Paladin? That would strengthen the party to an incredible degree, increasing survivability. Why make a potentially suicidal move just because the Paladin can't afford to buy it from the treasury?
Never mind that in most of our games there's a very high chance any half-sane Pally would be either voluntarily leaving the party ASAP or getting punted from the party ASAP...and the rest of the party would want to sell that holy avenger to either the Pally or anyone else who could put all that sweet coin in our hands.