What is Lis Pendens?
Lis pendens is a legal notice filed with the court and recorded in public records to notify interested parties that a lawsuit has been filed involving a specific property. The Latin term literally means “suit pending” or “pending litigation.”
When a lis pendens is filed, it serves as a warning to potential buyers, lenders, and other parties that the property’s ownership or title is being disputed in court. This notice effectively clouds the title and can prevent the property from being sold or refinanced until the legal matter is resolved.
How Does Lis Pendens Work?
The lis pendens process begins when a plaintiff files a lawsuit related to real property and simultaneously records a notice of lis pendens with the county recorder’s office where the property is located. This filing creates a public record that attaches to the property’s chain of title.
Once recorded, the lis pendens remains in effect throughout the duration of the lawsuit. It puts the world on constructive notice that any interest acquired in the property after the filing date will be subject to the outcome of the litigation.
The notice typically includes information such as the names of the parties involved, the case number, a legal description of the property, and the nature of the claim. Anyone conducting a title search will discover the lis pendens and understand that the property is involved in litigation.
Real-World Application of Lis Pendens in Real Estate
In foreclosure proceedings, lenders commonly file a lis pendens when initiating a foreclosure action against a homeowner. This prevents the homeowner from selling the property to a third party during the foreclosure process and protects the lender’s interest in the collateral.
Real estate disputes between co-owners also frequently involve lis pendens filings. For example, when business partners or divorcing spouses disagree about property division, one party may file a lis pendens to prevent the other from selling or encumbering the property while the court determines rightful ownership.
Construction disputes provide another common scenario. Contractors or suppliers may file a lis pendens when seeking to enforce a mechanic’s lien, alerting potential buyers that the property is subject to a payment dispute that could affect its value or transferability.
How Lis Pendens is Used
Real estate attorneys use lis pendens as a strategic tool to preserve the status quo during litigation. By filing this notice, they prevent adverse parties from transferring or encumbering the property in ways that could make any judgment difficult to enforce.
Title companies rely on lis pendens records during their title examination process. When a lis pendens appears on a property, the title company will typically refuse to issue a title insurance policy or clear the property for closing until the litigation is resolved or the notice is removed.
Property owners and defendants can challenge an improperly filed lis pendens by filing a motion to expunge it. Courts may remove a lis pendens if it was filed in bad faith, doesn’t involve a real property claim, or if the plaintiff cannot show a probability of prevailing in the lawsuit.
In Other Words
Think of lis pendens as a legal “caution tape” wrapped around a property’s title. Just as caution tape warns people to stay away from a hazardous area, a lis pendens warns potential buyers and lenders to stay away from a property involved in legal disputes.
Essentially, it’s a public announcement that says, “Be aware—this property is the subject of a lawsuit, and whoever buys it or lends against it may inherit the legal problems attached to it.” The filing freezes the property’s marketability without physically preventing its use or occupancy.
