A “Lis Pendens” (Latin for, and sometimes called, “pendency in action”), is a powerful legal tool that can be filed when there is a pending legal proceeding related to real estate property or potential claims on that property. For example, in a divorce, if there is already a dispute over who owns property, usually the husband’s or wife’s attorney; You can register a Lis Pendens with the county recorder, which notifies any prospective buyer that ownership of the property is in dispute.
This article is my opinion, and not legal advice. I am a trial broker, and I am not a lawyer. If you ever need legal advice or a strategy to use, contact an attorney.
A Lis Pendens is a means of transport within the meaning of the registration statutes. A means of transportation gives constructive public notice. Except possibly in Florida, very few title companies, lenders, or buyers will proceed until the lis pendens is removed.
Slightly related to a lis pendens, it is a partition action, which can occur when there are several owners and all or even one wants to sell the property. When a partition action is approved by the court, the property will be sold. There is no defense to a partition action, because if the parties do not agree, the court appoints a trustee to sell the property. The trustee takes a large portion of the proceeds and then makes distributions to the former owners of the property. There are no restrictions on the disposition, because it does not interfere with anyone’s right to sell the property. After the sale, everyone loses their increased basis and may have to pay capital gains taxes.
A Lis Pendence is not attached to individuals, but instead records a “Notice of Pending Action” against a particular property that is the subject of some impending legal proceeding. The recording gives constructive notice to the world that the real property is the subject of a legal matter that may affect the rights of a buyer, lender or other dealer in that real property, after the date of the recording of the notice. Anything that happens to that property after the date of registration of the notice will be subject to the outcome of the related legal action.
Lawyers can usually file a notice of pending action without a hearing or court order. Persons who are not licensed attorneys may not file a “Notice of Pending Action” unless they first have permission from the court to do so. A hearing must be held and the judge must agree that the proper litigant has probable cause to prevail on the merits. If the judge agrees, the judge will sign an order giving the court permission to file the notice of pending action.
In my opinion, a judgment executor who owns a judgment and files a lien, generally has no standing to file a Lis Pendens, because they do not have a “real property claim” as defined by statute because their lien interest generally would not result in the acquisition of a title interest in the real property. Therefore, in link situations, a Lis Pendens is probably not the appropriate course of action.
If you are the Judgment Creditor, and your Judgment Debtor may be selling your property or planning to do so, instead of a Lis Pendens; perhaps ask the court for a temporary restraining order, followed by a hearing on a preliminary injunction. Note that the owner of the real property may petition the court for an order that the creditor or the executor of the judgment provide an undertaking (post a bond) to protect the owner’s interest in the real property.