A lis pendens, or Notice of Pending Action, is a document which may be recorded which provides notice of a lawsuit that has to do with title to real property. It cannot properly be recorded until after the lawsuit has been filed. The owner of the property can file a motion to clear their title by having the lis pendens expunged, i.e. declared invalid by the court, if the lawsuit does not concern title to real property. Sacramento Real Estate attorneys often hear from parties who are anxious to record a lis pendens, but really do not have a property title claim. This is so important that if the party is not represented by an attorney but are representing themselves, they must get court approval to record a lis pendens. If a lis pendens is expunged, the property owner may also receive an award of their attorney fees and costs. But what about the harm to the owner while the property was tied up with the lis pendens? Slander of title is a false statement about real estate which harms the property’s value or salability, causing a direct pecuniary loss. As the court of appeal points out, a wrongful lis pendens may still not be found to be a slander of title.
In Alpha and Omega Development, LP v. Whillock Contracting, Inc., Whillock was a builder who brought an unsuccessful action to foreclose a mechanics lien. Part of that action included a lis pendens. Alpha had the lis pendens expunged. Alpha defaulted on the loan, and the property was foreclosed. Alpha then brought a slander of title action against the defendant, claiming that defendant without justification and without privilege caused to be recorded a Lis Pendens against the real property; that the recording of the lis pendens “directly impaired the vendibility and value of the [subject real property] on the open market while the real estate market in San Diego was rapidly declining”; and that as a result of the lis pendens, Alpha was damaged.
The elements of a cause of action for slander of title are