Updated on October 19, 2022
A recent appellate court decision allowed a plaintiff to record a notice of lis pendens on rental properties based on a constructive trust cause of action. Shoker v. Superior Court of Alameda County, Super. Ct. No. RG190369992, Docket A163711 (First Appellate District) (July 15,2022).
In California, a lis pendens is a document filed with a county recorder that provides constructive notice of a pending lawsuit affecting the real property described in the notice. Kirkeby v. Superior Court (2004) 33 Cal.4th 642, 647; Bishop Creek Lodge v. Scira (1996) 46 Cal.App.4th 1721, 1733. Any party may record a lis pendens when the lawsuit involves a “real property claim.” § 405.20; Kirkeby, supra, at p. 647. Code of Civil Procedure Section 405.4 defines a “ ‘[r]eal property claim’” to mean “the cause or causes of action in a pleading which would, if meritorious, affect . . . titleto, or the right to possession of, specific real property.” A lis pendens gives notice that the judgment will be binding on persons later acquiring an interest in that property. Bishop CreekLodge, supra, at p. 1733.
In the recent case of Shoker, the plaintiffs’ Complaint alleged that the defendants defrauded them from the ownership of 10 rental properties. The plaintiffs pled eight causes of action, including a cause ofaction for constructive trust. Eventually, the plaintiffs recorded a lis pendens on the 10 rental properties and the defendants moved to expunge the lis pendens, arguing that the plaintiffs did not assert a “real property claim.” The trial court granted the motion, accepting defendants’ argument.However, the Appellate Court in Shoker disagreed.
The Shoker Appellate Court recognized that the operative question in the case was whether the plaintiffs’ claim for constructive trust was a real property claim, that is, a cause of action that “would, if meritorious, affect….title to, or the right to possession of specific real property.” Code of Civil Procedure § 405.4. The Court acknowledged that § 405.4 does not restrict lis pendens to actions where a real property claimant only seeks title to, or possession of, specific real property.
Rather, it defined a “real property claim” to mean “the cause or causes of action in a pleading, which would, if meritorious, affect…title to, or the right to possession of, specific real property.” Thus, the Appellate Court declined to narrow the statute and mentioned that this result served the statute’s aim to preserve the status quo during litigation and recognized a plaintiff’s right to plead alternative remedies.
Moreover, the Shoker Appellate Court noted that “when legal title has been acquired through fraud any number of remedies are available and appropriate,” including making legal title holder constructive trustee for benefit of defrauded equitable title holder. Citing Warren v. Merrill (2006) 143 Cal.App.4th 96, 114.
Schorr Law, APC has experience representing both homeowners and homeowner’s associations in disputes related to the enforcement of governing documents in common interest developments. We also have extensive experience with issues unique to short term rentals and transient occupancy. To see if you qualify for a 30-minute consultation regarding your matter, please contact us by phone, email, or send us a message through our contact form.