Generally speaking, a lispendens is notice to the world that a property is involved in a civil suit. The property at issue need not be directly involved in the civil suit, but must be directly affected by the relief requested. Meljon v. Sonsino, __ S.E.2d __, 2014 WL 169831, at *2 (Ga. Ct. App. Jan. 16, 2014). A property owner can move to cancel a lispendeds, but the cancellation does not carry with it a cancellation of the underlying claim. Id.Thus, if a lispendens is filed based upon a faulty claim, a property owner should move to dismiss the underlying claim at the same time.
In Meljon, the Court of Appeals reversed the trial court’s cancellation of a lispendens because the fraudulent conveyance claim at issue would, if successful, have a direct impact on the title for the property. Id. at *3. There, the plaintiff sued defendant over a contract to purchase one property, but also alleged a fraudulent conveyance with regard to another unrelated property. Id. at *1-2. The unrelated property was the target of the fraudulent conveyance claim because the plaintiff feared an inability to collect if he won on his main claim.Id. Plaintiff had no other claim on the second property except a premature collection effort.Id.
Although the claim underlying the lispendens was so doubtful that the Court of Appeals included a footnote questioning its merits,the court could not address that claim because no motion had been filed attacking it. Id. at *3. Thus, as a practical matter, motions to cancel lispendens as a result of a faulty underlying claim should always be accompanied by a dispositive motion.
Scott L. Bonder is a trial lawyer who represents companies and individuals in a broad range of business disputes and litigation, including breach of contract litigation, franchise litigation, and partnership and shareholder disputes.