What is a Lis Pendens in Arizona 2023?

A lis pendens is a legal document that serves as notice to the public that a property is the subject of a pending lawsuit. It is typically filed by the plaintiff, or the party initiating the lawsuit, and is recorded in the county recorder’s office where the property is located. Once recorded, the lis pendens becomes a public record and is available for anyone to view.

Notices of Lis Pendens are specifically authorized in A.R.S. § 12-1191(A), which states:

In an action affecting title to real property, the plaintiff at the time of filing the complaint, or thereafter, and the defendant at the time of filing the defendant’s pleading when affirmative relief is claimed in such pleading, or thereafter, may file in the office of the recorder of the county in which the property is situated a notice of the pendency of the action or defense.

In Arizona, a lis pendens must include the names of the parties involved in the lawsuit, a description of the property, and a statement that a lawsuit involving the property is pending. Once filed, the lis pendens effectively creates a cloud on the title, which means that the property cannot be sold or transferred until the lawsuit is resolved.

How Does Lis Pendens Affect a Real Estate Transaction?

If a property is subject to a lis pendens, it can significantly impact a real estate transaction. For example, if there is a recorded lis pendens against your property, it may be difficult or impossible to sell the property until the lawsuit is resolved. Additionally, if a buyer discovers that a property they’re interested in purchasing is subject to a lis pendens, they may decide to back out of the transaction due to the potential legal risks.

It’s important to note that not all lis pendens are valid or enforceable. In some cases, a lis pendens may be filed in bad faith or without proper legal grounds. If that happened to you, call us at 602-443-4888 to help you remove it.

Wrongfully filed lis pendens – wrongful lien

A notice of lis pendens requires a legal action affecting title to real property. The Arizona Supreme Court has held that “The crucial question in determining the propriety of a lis pendens is whether the underlying action “affect[s] title to real property.” Farris v. Advantage Capital Corp., 217 Ariz. 1, 170 P.3d 250 (2007). Similarly, “In determining whether a lis pendens was wrongfully recorded, the court is limited to considering ‘whether the “action is one affecting title to real property.'” Santa Fe Ridge Homeowners’ Assn. v. Bartschi, 219 Ariz. 391, 395, 199 P. 3d 646 (App. 2008).

A.R.S. Section 33-420 provides:

A. A person purporting to claim an interest in, or a lien or encumbrance against, real property, who causes a document asserting such claim to be recorded in the office of the county recorder, knowing or having reason to know that the document is forged, groundless, contains a material misstatement or false claim or is otherwise invalid is liable to the owner or beneficial title holder of the real property for the sum of not less than five thousand dollars, or for treble the actual damages caused by the recording, whichever is greater, and reasonable attorney fees and costs of the action.

Liability under that statute arises if two elements are present. First, there must be a person purporting to claim an interest in real property. Second, that person must cause the recording of a document knowing or having reason to know the document is groundless. Furthermore, liability under the statute is automatic. It is not discretionary with the court.

A.R.S. Section 33-420 provides for severe penalties if someone records a Notice of Lis Pendens in violation of law. It provides for treble (three times) the owner’s actual damages or statutory damages of $5,000 (whichever is greater) and attorneys’ fees. If you believe that a Notice of Lis Pendens has been wrongfully recorded, you may file an action to immediately cancel the Notice and clear title to the property.

How to Remove a Lis Pendens

Once a lawsuit is resolved, the lis pendens can be removed from the property’s title. In some cases, the lis pendens may automatically expire if the lawsuit is not pursued or if a judgment is entered against the party who filed the lis pendens. However, if the lis pendens is still valid, it will need to be formally released or cancelled through a court order.

In Arizona, there are specific requirements that must be met in order to have a lis pendens released or cancelled. This process can be complex and time-consuming, which is why it’s important to consult with an experienced real estate attorney to guide you through the process. One way we may be able to remove a lis pendens is by filing a Motion to Expunge Notice of Lis Pendens. In that motion, we may also request an award of your attorneys’ fees under A.R.S. Section 33-420(A).

Let us help you. Call us at 602-443-4888.

Who Can File a Notice of Lis Pendens in Arizona 2023?

The party who initiates a lawsuit over real estate or title to property has the right to file a Notice of Lis Pendens in Arizona. The document is required to be filed with the court and must also be served on all other interested parties. Once recognized by the court, it serves as an official notification that someone is claiming rights to the property, which will now be subject of a legal dispute.

Does a Notice of Lis Pendens prevent a sale or transfer title to the property?

A Notice of Lis Pendens does not necessarily prevent transference of title or a sale of a property but such an action should be undertaken with caution. The other parties named in the lawsuit will be notified of the pendency and may choose to challenge any title transfer based on the current claim over rights to the real estate. It is usually wise to wait until the legal dispute is resolved before undertaking any sales agreement or transferring title.

Conclusion

Lis pendens is a legal notice filed to provide notice of a pending lawsuit involving a property. In Arizona, lis pendens can significantly impact a real estate transaction by creating a cloud on the title and potentially delaying or preventing the sale or transfer of the property.

Our law firm handles disputes over title to real property, including claims involving Notices of Lis Pendens and other wrongful liens. If you have any questions about Arizona real estate law, please give us a call at 602-443-4888. Or you can fill out our convenient Contact Form.