A lis pendens attorney will help you record your lien against the real property of another or cancel a lien that has been recorded on your real property.
What is a lis pendens?
lis pendens, or notice of pendency in New York, is a notice filed by the plaintiff with the county clerk where the real estate is located, stating that the real estate is subject to a legal dispute. This lis pendens notice can only be filed when the plaintiff has instituted a complaint whose main purpose is to affect possession, use or enjoyment of the real property. When requesting the recording of a lis pendens, you must also submit to the county clerk a copy of your complaint.
Effect of a lis pendens
Once lis pendens or a notice of pendency is recorded with the county clerk, any transactions regarding the real estate property covered by the lis pendens will be subject to the outcome of the legal dispute. Under CPLR § 6501, the registration of a notice of pendency is constructive notice to the public that the property is subject of a dispute.
Aside from the effect of a constructive notice to the public, lis pendens discourages title insurance companies from insuring the title, making it more difficult for the real property to be sold. Sometimes, buyers will purchase the real property with a lis pendens at a price substantially lower than its market value because the buyer is taking a risk, purchasing it subject to whatever the outcome of the legal case will be.
When can you register a notice of lis pendens?
As previously mentioned, a notice of lis pendens can be recorded when the complaint you filed has for its purpose a relief to affect possession, use, or enjoyment of the real property.
For example, if you are a buyer who, after making a downpayment, files a case against the seller for the enforcement of the contract of sale of real property, you can file a notice of pendency in this case. Why? Because the main object of your case is to acquire title over the real property.
What if you filed your notice of pendency over the real property and this lis pendens notice was recorded, then subsequently the seller was able to sell the property to a third person? If you win in the case and the seller is forced to sell the property to you, the third person who purchased it from the seller is bound by the court’s order that the seller must sell the property to you.
Another example would be the recording of an easement. For example, you filed a case against a landowner claiming that you have acquired an easement of right of way over his property. You record a lis pendens notice with the county clerk. Subsequently, someone purchases the property from the landowner. If the court declares that you have an easement of right of way over the landowner’s property, the purchaser is bound by this court declaration and must respect the easement since the purchaser bought the property subject to the lis pendens notice.
What if you loaned someone money, and in return, this person executed a promissory note in your favor? The debtor failed to pay you the loaned amount. You filed a lawsuit to collect the debt. You subsequently learned that the debtor owned real property, and you attempt to register a lis pendens over the real property in order to secure the debt. Will the lis pendens be registered? No, your request for a lis pendens will not be registered because the main purpose of your action is to collect on a debt and entirely unrelated to the real property.
What if in exchange for the loan, the debtor mortgaged his property to you? When the debtor defaulted on the loan, you attempted to register a lis pendens on the property due to your action to foreclose on the mortgage. In this case, will your lis pendens be registered? Yes, because the main object of your foreclosure action is to affect title over the real property due to nonpayment of debt.
Other instances allowing lis pendens are: 1) mechanic’s lien where a laborer who worked on your property remains unpaid for his services; 2) a partition action; or, 3) failure to file real property taxes.
When you cannot file a lis pendens
If you don’t qualify for a mortgage or you are no longer interested in buying the property and you just want your deposit back, then you can sue the seller for the deposit but you probably cannot place a lis pendens on the property because the lawsuit is not about the property, it’s only about the deposit.
Contents and procedural requirements of lis pendens
The law requires the notice of lis pendens to state the names of the parties to the action, the object of the action, and a description of the property affected. Summons must be served and completed upon the defendant within 30 days from recording the lis pendens. Otherwise, the lis pendens notice is ineffective.
Duration and cancellation of notice of lis pendens
A lis pendens notice is effective for a period of 3 years from filing, unless canceled or extended. A lis pendens attorney can help you cancel the lis pendens notice in a number of ways.
First, your lis pendens attorney can file a motion for cancellation because 1) service on the defendant was not completed within the 30-day period from filing the notice of lis pendens; 2) action has been settled, discontinued, or abated; or, 3) a judgment was rendered in favor of defendant and against the plaintiff.
Second, your lis pendens attorney can also file a motion to direct the county clerk to cancel the lis pendens notice because the plaintiff did not commence or prosecute the action in good faith.
Third, your lis pendens attorney can also cancel a lis pendens notice upon the filing of an affidavit that the plaintiff/s and defendant/s have consented to the cancellation by stipulation, attaching the stipulation signed by the parties and/or their attorneys.
Fourth, your lis pendens attorney may file a motion to cancel the lis pendens notice upon presentation of an undertaking in an amount to be fixed by the court, which would provide adequate relief to the plaintiff or defendant, whatever the case may be.
A notice of lis pendens is a serious matter and can impair one’s ability to sell his property. It is a powerful tool that can be used during negotiations. When recording or canceling a notice of lis pendens, it is important to get the services of a lis pendens attorney to ensure that you get it right the first time. If your notice of lis pendens is not correctly done, it can be declared invalid, and any transaction made during that time will not be bound by the outcome of the litigation.
Should you need a lis pendens attorney, we at the Law Offices of Albert Goodwin are here for you. We have offices in New York, NY, Brooklyn, NY and Queens, NY. You can call us at 718-509-9774 or send us an email at firstname.lastname@example.org.