Lis Pendens: A Powerful Tool to Enforce Rights in Property
When non-lawyers hear the term "lis pendens", many immediately shudder. Those same people may have been on the "receiving" end of a lis pendens, and they know how powerful a tool it can be to leverage rights in real estate.
The term "lis pendens" is Latin for "litigation pending". When we talk in legal terms about a lis pendens, we are referring in the technical sense to a "memorandum of lis pendens" that a judge may approve and sign, and which is recorded in the registry of deeds where the relevant property is located. Once recorded, the lis pendens functions as a "cloud" on the title of the property, much like a mortgage or a tax lien. Its recording cripples a party from being able to sell property.
The standard for obtaining a lis pendens in Massachusetts is simple: A person seeking a lis pendens must establish that the subject matter of their lawsuit "constitutes a claim of a right or title real property or the use and occupation thereof." Once that has been established–and it need only be established by what is known as a "verified complaint" signed by the plaintiff (and not just the plaintiff's attorney)–then the judge must issue the lis pendens.
A lis pendens is usually obtained by a buyer who claims a right under contract to buy property. Cases where a lis pendens is sought often arise where a seller has accepted an offer by the plaintiff to buy property but where the parties are unable to negotiate a purchase and sale agreement. It can be used, however, in other instances, such as asserting rights to an easement or even a tenancy.
Plaintiffs can sometimes secure a lis pendens without notice to the seller/defendant; in other instances a judge will insist that the seller be provided with notice and an opportunity to be heard in opposition to the request. In either event, sellers have an equally powerful weapon at their disposal: a device known as the special motion to dismiss. Such a motion must be granted if the court finds there is no "arguable basis in fact or in law" to support the plaintiff's claims. If the motion is allowed, the court is required to award the defendant its reasonable attorney's fees.
Here's where things get interesting. The lis pendens statute states that a plaintiff must certify in his complaint that he has not omitted any material facts in the complaint. Even if a plaintiff includes facts that may otherwise give him a right to a lis pendens, if he leaves anything critical out of the complaint (and litigants often do so for their own benefit), the court has grounds upon which to allow the special motion to dismiss. Thus, anyone seeking a lis pendens must disclose all material facts–even if those facts may be adverse to his case–if he wants to reduce the possibility of a dismissal and the painful award of attorney's fees.
For sellers who suffer the nightmare of a lis pendens and cannot prevail on a special motion to dismiss, there are other avenues of remedy, though none of them are quite as expeditious. These include accelerating discovery and moving for "summary judgment" (judgment without a trial based on undisputed facts); or prevailing upon the plaintiff to submit the case to binding arbitration.