“Legalese” often renders the law more confusing than it needs to be. Case in point: “lis pendens” (pronounced liz pendenz). This latin phrase meaning “lawsuit pending” refers to a legal document designed to inform the public of a lawsuit that could affect the right to own or possess a specific parcel of real estate. The precise laws and procedures surrounding a lis pendens vary from state to state, but in Utah the following principles apply.
How Does It Work?
A lis pendens is recorded against the property in the county recorder’s office, which means it will show up in a title search, similar to a lien against the property. The lis pendens identifies the lawsuit and the court in which it is filed so that interested parties can investigate the lawsuit and learn more about it before deciding whether they want to acquire an interest in the property. Moreover, all potential buyers and lenders are put on notice of the pending lawsuit and will be bound by the lawsuit’s outcome, even if they didn’t actually see the lis pendens or know of the lawsuit.
Should I Care?
Most buyers balk at the possibility of purchasing property the court may later decide did not belong to the seller. For this reason, a lis pendens can make it difficult-to-impossible for an owner to transfer his or her property. Say the buyer goes through with it, however, and the court later decides it was never the seller’s to sell. When this happens, it’s the buyer who takes the fall, with he or she ending up empty handed. Similarly, if a buyer purchases property believing it to be lien-free, but does so in spite of a lis pendens recorded by someone claiming a lien against the property, the buyer will most likely have to either pay the lien holder the money owed it or forfeit the property to foreclosure should the court declare the lien valid.
Can a lis pendens be filed even if there is not a pending lawsuit?
No. A lis pendens can only be filed if a lawsuit is pending. After all, that is what the phrase means – lawsuit pending.
Who can record a lis pendens?
Any party to a lawsuit can record a lis pendens. Usually it is filed by the plaintiff, but it can also be filed by a defendant.
Can a lis pendens be recorded in any lawsuit?
No. A lis pendens can only be recorded in a lawsuit that will decide either 1) who owns the property; or 2) who can possess the property. If the lawsuit will decide one or both of these questions, a lis pendens can be recorded. This is the case even if there are other issues that will be decided in the lawsuit that do not involve the property. A lis pendens must be recorded with respect to lawsuits that seek to foreclose construction or preconstruction services liens.
What is the procedure for filing a lis pendens?
First, a lawsuit must be filed that will determine the right to own and/or possess real estate. Second, one of the parties to the lawsuit (usually a party’s attorney) will prepare a written lis pendens and file the lis pendens with the court. Third, once the lis pendens has been filed with the court, the party must then record the lis pendens with the county recorder’s office of the county in which the property is located. The recorder will charge a small recording fee. Failing to complete any step, or performing any step out of order, could invalidate the lis pendens.
Can a property owner remove a lis pendens from his property?
An owner of real estate encumbered by a lis pendens can attempt to have the lis pendens removed from his property three different ways. First, the owner can try to get the lis pendens holder to release its lis pendens voluntarily, such as by giving the lis pendens holder what it is demanding, reaching a settlement with the lis pendens holder, or convincing the lis pendens holder that the lis pendens is improper. Second, the property owner may be able to file a motion with the court asking that an order be issued releasing the lis pendens. To succeed on such a motion, the property owner will have to show that the lis pendens is invalid. Third, the property owner can win the lawsuit on the issue(s) giving rise to the lis pendens.
If you have questions about a lis pendens, or need help filing or dealing with a lis pendens, we invite you to contact us directly at the number listed below.