Expunging A Lis Pendens in California Real Estate Litigation

What Is A Lis Pendens?

A real estate litigation attorney will draft a lis pendens or Notice of Pending Action in a real estate lawsuit and both file it in the Superior Court and record it with the County Recorder. The notice is intended to give notice to anyone with a potential interest in a property that there is a lawsuit pending which affects the title to or possession of a piece of real property.

How Does An Attorney Get Rid Of A Lis Pendens?

Technically, it is called expunging a lis pendens. California Code of Civil Procedure §405.31 and §405.32 provide that the court must expunge a lis pendens if (1) the Claimant fails to plead a real property claim or (2) cannot establish by a preponderance of the evidence that they will prevail on any claim affecting title to or possession of real property.

Code of Civil Procedure section 405.31 provides: “In proceedings under this chapter, the court shall order the notice expunged if the court finds that the pleading on which the notice is based does not contain a real property claim.” “In making this determination, the court must engage in a demurrer-like analysis. Rather than analyzing whether the pleading states any claim at all, as on a general demurrer, the court must undertake the more limited analysis of whether the pleading states a real property claim.”

Review involves only a review of the adequacy of the pleading and normally should not involve evidence from either side, other than possibly that which may be judicially noticed as on a demurrer. Therefore, review of an expungement order under section 405.31 is limited to whether a real property claim has been properly pled by the claimant.

Whether a complaint alleges a “real property claim” so as to justify placing a lis pendens on the property is a question of law. Because a lis pendens renders real property unmarketable, and has been misused to coerce settlements, the right to maintain it has been narrowly circumscribed in recent years.

In analyzing whether an action actually affects title or possession to the real property at issue, courts consider the nature of the dispute. A buyer’s action for specific performance of a real property purchase and sale agreement is the prototypical example of an action for which a lis pendens is appropriate and necessary. An action that is essentially one for damages, an equitable lien, or a constructive trust will not support a lis pendens, even if it relates to a specific parcel of real property.

The second approach that a litigation attorney can use to expunge a lis pendens is a showing that the claimant cannot establish by a preponderance of the evidence that he or she will prevail on any claim affecting title to or possession of real property. Code of Civil Procedure §405.32 states in part that “the court shall order that the notice be expunged if the court finds that the claimant has not established by a preponderance of the evidence the probable validity of the real property claim.”

The attorney challenging the lis pendens in this situation should be prepared to present evidence, including documents and declarations, which establish why the claimant will fail on its real property claim.

Once a lis pendens is ordered expunged, the party who challenged it must still wait until the time in which to bring a writ of mandate in the Courts of Appeal has passed. Once the lis pendens has been expunged, a party may not file another lis pendens on the property without leave of court. Lastly, the party who prevails on the motion to expunge the lis pendens is entitled to attorneys fees unless the court finds that the other party acted with substantial justification or other circumstances make the imposition of sanctions unjust.

If you are engaged in real estate litigation involving a lis pendens, make sure that you retain an attorney who has experience expunging lis pendens.