11.24 Lis Pendens

11.24.1

In General

A lis pendens is a recorded legal instrument which serves as constructive notice, by statute, that an action or suit affecting a specified piece of real estate has been commenced in a federal or state court. The term is a Latin term meaning "action pending."

Notice of lis pendens is the common-law doctrine that a pending suit is notice to all the world, so that one who purchases property involved in the litigation takes it subject to and is bound by the judgment rendered therein.

A lis pendens is not a lien, but rather a notice of a possible interest in the property. Recording the lis pendens gives notice to all interested parties, such as prospective purchasers and lenders, and establishes a priority for the later interest in the property which dates back to the date in which the lis pendens was recorded. If a lis pendens appears subsequent to a mortgage that has been foreclosed, closely scrutinize state law.

In order to provide constructive notice that while the action is pending, the notice provided by a lis pendens should set forth: (1) the parties' names; (2) the purpose of the suit; and, (3) a legal description of the property.

The law of the state where the land is located determines:

  • Whether a purchaser for value is charged with notice of a pending suit.

  • Whether actions in rem and actions in personam are treated equally.

  • Whether notice of lis pendens is required to be filed in the real estate records.

  • Whether actual knowledge of the pending action replaces the lack of required notice of lis pendens.

Two ways to eliminate a lis pendens are as follows:

  • Dismissal of action with prejudice;

  • Filing of a statutory bond if permitted by state statute.

Some states provide that a lis pendens may be expurged by court order. State law must be fully researched in connection with the above particulars.