Who is Lis Pendens?

Lis Pendens is actually not a person, but a document filed in Court and Public Records that creates what is called a “cloud” on title to real property under Florida law.  It is specifically and statutorily authorized in Florida by Section 48.23 of the Florida Statutes.

There are two types of lis pendens under Florida law; (i) those of right that are founded on duly recorded instruments, and (ii) those that are not founded on duly recorded instruments, but may still be maintained in the discretion of a Court.

The first kind basically means a lis pendens based on recorded liens and other recorded instruments, like mortgages.  For example, a materialman’s lien is recorded in the Public Records and Chapter 713 of the Florida Statutes imposes special requirements for the language to be used in the lien and the time within which to record and act on it.  These requirements must be strictly followed and there are consequences for improper/fraudulent liens.  Before attempting to record any such lien, you should consult with an attorney that understands and has experience in real estate and real property litigation, including those Board Certified in Real Estate and Business Litigation, who are experts in those fields.

The second type of lis pendens is allowed only under certain circumstances within the discretion of a Judge after the proponent satisfies his or her burden of proving a nexus between the lawsuit and the property.  This generally must be done through an evidentiary hearing where the Plaintiff has to prove that he or she has a claim that affects title to the real property.  An example is where a party loans money for the purchase of land under a written agreement that the title would include that party, but ultimately doesn’t.  While there may not be a lien right, that kind of claim, usually a constructive trust, may sufficiently rise to the level of qualifying for a lis pendens to protect the Plaintiff’s claim in the property.

So what does a lis pendens actually do?  Technically, it notifies prospective buyers of a claim against property in a pending lawsuit and protects the claimant from losing his or her right to the property to a subsequent purchaser.  Contrary to common belief, a lis pendens does not prevent the owner from selling the property.  However, in common practice it generally bars the transfer of title because most title companies will not provide insurance, closing agents will not close without the lien being bonded, and buyers won’t buy because they can’t obtain clear title or become bona fide purchasers.  Importantly, if a buyer purchases property subject to a lis pendens, that party may actually inherit the lawsuit.  Lastly, improperly filing a lis pendens can subject a party to liability including punitive damages, therefore, is it prudent to seek qualified expert legal counsel before purchasing property or filing a lien or lis pendens.

David Steinfeld, Esq.

Florida Bar Board Certified Business Litigation Lawyer

Martindale-Hubbell AV-Preeminent (Highest) Peer Review Rated

 

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