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Lien on Real Estate

Written by on Jul 21, 2009| Posted in: General

Lis Pendens Law Changed by Florida Legislature

A lis pendens is Latin for “suit pending.” Typcially it refers to a pending lawsuit or notice of litigation that is recorded in the same county as the physical location where the title to the real estate has been recorded.

There are a variety of reasons for filing and recording a lis pendens, however, the one most frequently quoted is for a plaintiff in a lawsuit, including probate and trust litigation cases, to serve notice of plaintiff’s claim on the real property, so that any alienation of the property takes subject to the plaintiff’s claim. In other words, very few potential purchasers will purchase real estate which has a claim against it thus the lis pendens has the practical effect of preventing sale while the lawsuit continues which is very important if the real estate is the asset that will be used to satisfy a judgment. It is well settled in Florida that the purpose of a notice of lis pendens is to warn everyone that the title to the property is in litigation and that there is a cloud on the title to the property involved.

One Federal Court has ruled that Under Florida law, a party taking an interest in the affected property subsequent to the recording of notice of lis pendens takes subject to the interests of the party filing the notice, as ultimately vindicated in the litigation as to which notice has been given. In re Whitehead, 399 B.R. (Bankr. S.D.Fla. 2009).

The importance of understanding the general purpose, notice requirements, and the practice and procedure of lis pendens in Florida cannot be understated. To this end, it is also significant to take notice of the changes that were signed into law by the Governor and became effective July 1, 2009.

First, Fla.Stat. §48.23 was amended so that any person acquiring for value an interest in the real estate or personal property during the pendency of an action involving real property, (other than a party to the proceeding or the legal successor by operation of law, or personal representative, heir, or devisee of a deceased party to the proceeding), shall take such interest exempt from all claims against the property that were filed in such action by the party who failed to record a notice of lis pendens or whose notice expired or was withdrawn or discharged, and from any judgment entered in the proceeding, notwithstanding the provisions of s.695.01, as if such person had no actual or constructive notice of the proceeding or of the claims made therein or the documents forming the causes of action against the property in the proceeding.

Thus, the revisions permit real estate to be sold exempt from all claims asserted in an action when the lis pendens has expired or been withdrawn or discharged.

The new revised statute also extends the time to thirty days for a holder of an unrecorded interest to intervene in the action. Previously, only twenty days after recording of the notice was permitted.

Finally, the new statute simplifies the information necessary for filing a valid lis pendens and provides for the control and discharge of a lis pendens that no longer affects the property.

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