In real estate, a lis pendens is a notice filed in public records to alert potential buyers or lenders that a property is subject to a pending legal claim or dispute that could affect ownership or title. Such an encumbrance on a property can render it difficult, if not impossible, for the owner to sell it or obtain additional financing and otherwise negatively impact its value.
An Ansell.Law client who urgently needed to sell their commercial property recently faced this predicament when a putative buyer improperly filed a lis pendens on the property, frustrating the owner’s efforts to dispose of it. Ansell.Law Shareholder Anthony J. D’Artiglio and Associate Brian J. Ashnault then successfully moved in the Superior Court of New Jersey, Law Division, to discharge the lis pendens, removing the encumbrance and allowing the client to proceed with his sales efforts.
The matter arose after the Firm’s client/property owner entered into a purchase and sale agreement with a buyer to sell the property on a time-of-the-essence closing date. After the buyer was unprepared to close on the closing date and several closing dates thereafter, the seller terminated the purchase and sale agreement due to the breach of its terms. The putative buyer incorrectly claimed that the termination of the purchase and sale agreement was improper and filed a lis pendens against the subject property.
Ansell successfully argued that under N.J.S.A. 2A:15-7(b) and prevailing case law, the lis pendens should be discharged as the buyer could not make the required showing to maintain the encumbrance on the property. Specifically, Ansell persuaded the court that the buyer could not demonstrate that its claims against the owner were meritorious, such that it could maintain the extraordinary burden of a lis pendens on the property.
Following contentious briefing and oral argument, the court agreed with Ansell’s argument and granted its application to discharge the lis pendens. As a result of D’Artiglio and Ashnault’s aggressive advocacy, the lis pendens on the subject property was discharged, and the encumbrance was lifted from the property.
If you have questions about this case or other real estate litigation matters, please contact Anthony D’Artiglio, Brian Ashnault, or your Ansell.Law attorney for assistance.
