Real estate transactions in California hinge on the concept of “clean title.” This is the idea that a property can be transferred without uncertainty or risk about who owns it or whether others may claim a right to it. When a lawsuit involves real estate, however, the property can become entangled in litigation, making it legally risky or even impossible to sell or refinance. This is where a lis pendens (Latin for “pending lawsuit”) comes into play.
A lis pendens is a formal notice that litigation is underway involving a specific piece of real property. Though not a lien, it can cloud the title just as effectively. Below, we explore how a lis pendens works in California, how it can stall real estate deals, and how to fight or remove one if it’s improperly recorded.
What Is a Lis Pendens?
Under California Code of Civil Procedure § 405.2, a lis pendens (also called a Notice of Pendency of Action) is a document filed with the county recorder’s office to alert the public that a property is subject to ongoing litigation that may affect title or possession. It provides constructive notice to any potential buyer, lender, or other interested party that the property’s legal status is in dispute.
The primary purpose of a lis pendens is to preserve the status quo. It prevents owners from transferring or encumbering the property in a way that could thwart the plaintiff’s ability to obtain relief if they prevail in court.
Common Cases Involving Lis Pendens
Lis pendens commonly arises in cases such as:
- Partition actions, where co-owners disagree on whether to sell or divide a property
- Quiet title lawsuits, where there are competing claims to ownership
- Specific performance claims, where a buyer sues to force the seller to complete a real estate transaction
- Fraud or undue influence, such as forged deeds or elder abuse in property transfers
- Divorce or probate disputes, where family members assert rights to the same property
How a Lis Pendens Is Filed
To be valid in California, a lis pendens must meet strict procedural requirements:
- It must be recorded in the county where the property is located.
- The underlying lawsuit must affect the title or right to possession.
- The filer must serve all parties in the action, including the property owner.
- A declaration of service must be filed with the court promptly.
Failing to comply with any of these steps can make the lis pendens vulnerable to removal.
How a Lis Pendens Affects Property Sales and Title
A lis pendens creates what’s called a “cloud on title.” This means the property’s ownership is now uncertain or subject to dispute, making it nearly impossible to convey the property with a clear title. Most title companies will refuse to insure a transaction involving a property with a recorded lis pendens. Without title insurance, lenders won’t finance the purchase, and buyers will be reluctant to proceed.
For property owners, the effects can be devastating:
- Delayed or canceled sales due to title issues
- Inability to refinance or use the property as collateral
- Reduced property value, since it is now tied up in litigation
- Legal expenses to defend a claim, even if the lawsuit lacks merit
Some owners face strategic abuse of lis pendens by former business partners or aggrieved buyers trying to gain leverage in unrelated disputes.
Risks for Buyers and Lenders
Buyers must conduct due diligence to discover any recorded lis pendens before closing. If they purchase a property with a lis pendens on record, they’re deemed to have notice of the lawsuit. They could lose the property if the plaintiff prevails. Lenders, for their part, won’t fund a deal with a compromised title, shutting down most financing options.
Contesting or Removing a Lis Pendens in California
A property owner or defendant in the litigation can seek to expunge the lis pendens if:
- The underlying lawsuit does not affect the title or the right to possess the property
- The plaintiff failed to follow the filing and service requirements
- The claim is frivolous or lacks merit
An improperly filed lis pendens can be seen as a strategic weapon rather than a legitimate notice of legal dispute, and courts have the power to remove it.
Motion to Expunge a Lis Pendens
Under California Code of Civil Procedure §§ 405.30–405.39, a motion to expunge is the legal mechanism to challenge a lis pendens. The moving party must show one of the following:
- The plaintiff has not established the “probable validity” of their real property claim
- The action does not actually concern a real property interest
If successful, the court will issue an order expunging the lis pendens. The plaintiff may also be required to pay attorney’s fees and court costs if the court finds the lis pendens was recorded without justification.
Alternative Resolutions
Not all lis pendens need to be litigated to resolution. Other options include:
- Settlement or stipulation to withdraw the lis pendens
- Posting a bond or other financial security in exchange for removal
- Voluntary withdrawal by the filer if the claim is resolved or abandoned
Defending Against a Motion to Expunge
If you’ve filed a lis pendens and the other party files a motion to expunge it, you’ll need to demonstrate the probable validity of your real property claim. This means submitting evidence, such as contracts, deeds, or affidavits, showing that your lawsuit is more likely than not to succeed.
If the court grants the motion to expunge, you may lose leverage in the lawsuit. In some cases, a plaintiff may be ordered to pay the opposing party’s legal costs if the court finds the lis pendens was improperly recorded or maintained.
Filing a Lis Pendens Responsibly
A lis pendens should only be filed in California when the underlying litigation directly concerns the title, ownership interest, or right to use or possess the property. This means the lawsuit must assert a real property claim, not just a financial interest or contractual dispute.
For example, a lis pendens is appropriate in a quiet title action where two parties are fighting over who owns a parcel of land, or in a specific performance lawsuit where a buyer is suing to compel the seller to complete a real estate sale. Partition actions among co-owners, or lawsuits over forged deeds, are also legitimate grounds for recording a lis pendens.
Improper uses, however, are more common than many realize. A dispute between neighbors over noise, a breach of a home improvement contract, or an unpaid loan with no claim to ownership are not valid grounds. Filing a lis pendens in these situations is not only ineffective: it can expose the filer to serious legal consequences.
Legal Risks of Abuse
Because of its powerful impact on property rights, misusing a lis pendens can backfire significantly.
First, courts may impose sanctions under California Code of Civil Procedure § 405.38 if the notice was recorded without justification or if the filer opposes a motion to expunge without reasonable cause. Sanctions may include paying the opposing party’s attorney’s fees and court costs.
Second, a wrongfully filed lis pendens could give rise to claims for malicious prosecution or abuse of process. Suppose the lawsuit is later found to be baseless or brought for an improper purpose. In that case, the filer may be liable for damages resulting from interference with a sale, loss of financing, or reputational harm.
Finally, parties who record a lis pendens have a duty to withdraw it if their claim is dismissed or resolved. Keeping a lis pendens on record after a case has been adjudicated, especially when the plaintiff has lost, can lead to additional liability.
Practical Tips for Buyers, Sellers, and Property Owners
Whether you’re buying or selling property in California, due diligence is critical when it comes to lis pendens.
Buyers should obtain a preliminary title report from the title company to identify any recorded lis pendens, liens, or clouds on title. Sellers should conduct their own check of the county recorder’s records to ensure no one has recorded a notice without their knowledge.
In some cases, litigation may be pending that hasn’t yet resulted in a recorded lis pendens. Reviewing civil case dockets in the local courthouse can help uncover hidden risks.
What to Do If a Lis Pendens Is Discovered
If a lis pendens is discovered during escrow or due diligence, act quickly. The first step is to consult a qualified real estate litigation attorney to evaluate the notice and underlying lawsuit.
The attorney can help you:
- Analyze the legal basis of the lis pendens
- Determine whether it affects the title or possession
- Explore strategic options, such as a motion to expunge, settlement, or bond posting
If you’re a seller, you may need to pause the sale or renegotiate escrow timelines. Buyers, meanwhile, should assess whether it’s worth waiting for the lis pendens to be resolved or walking away entirely.
Working With Title Companies and Escrow
Title companies and escrow officers treat lis pendens seriously. In most cases, a lis pendens will prevent title insurance from being issued, which in turn stalls or cancels the transaction.
Escrow companies may insert delay clauses that allow for extensions if litigation clouds the title, or holdback agreements where funds are withheld until the lis pendens is resolved. In rare cases, a buyer may agree to close subject to the lis pendens. However, this is only advisable with strong legal guidance and title risk insurance.
How Peterson Law, LLP Helps Clients Navigate Lis Pendens Disputes
At Peterson Law, LLP, we bring deep experience in real estate litigation, particularly involving lis pendens, title defects, and co-ownership disputes. We understand how these disputes can derail deals, damage property value, and place your legal rights in jeopardy.
We represent:
- Property owners and sellers facing wrongful lis pendens that block sales or refinancing
- Buyers and investors dealing with properties clouded by litigation
- Heirs, business partners, and co-owners involved in partition actions or ownership disagreements
- Plaintiffs with legitimate property claims who need to secure their interest with a properly filed lis pendens
Our services include:
- Filing and defending motions to expunge
- Litigating quiet title and partition lawsuits
- Challenging fraudulent or forged deeds
- Advising clients during probate disputes involving real estate
- Strategic pre-litigation guidance to avoid unnecessary escalation or title defects
If you’re navigating a lis pendens issue, Peterson Law, LLP is ready to protect your interests and resolve the dispute efficiently.
FAQs About Lis Pendens in California
Can I sell a property with a lis pendens?
Technically, yes, but practically no. Most buyers and lenders won’t proceed until it’s cleared.
How long does a lis pendens last?
It remains in effect until the litigation is resolved or the court orders its removal.
What happens if I ignore a lis pendens?
You risk losing the ability to sell or refinance your property. You could face legal consequences if you transfer the property improperly.
Does a lis pendens mean the filer will win the case?
No. It only means a lawsuit is pending. The filer must still prove their claims in court.
Can I recover damages if someone filed a lis pendens wrongfully?
Yes. If a lis pendens is recorded without justification, you may recover attorney’s fees, costs, and potentially damages for interference with your property rights.
Get Help Clearing or Defending a Lis Pendens
A lis pendens is a powerful legal tool, but it must be used correctly. Whether you’re facing one on your property or considering filing one to protect your legal rights, the stakes are high. In California’s competitive and high-value real estate market, even a temporary cloud on title can lead to serious financial consequences.
If you need help clearing a lis pendens, defending against one, or navigating the legal complexities of real estate litigation, Peterson Law, LLP is here to help. Contact us today for a consultation and protect your property’s future.
