In Order to Validly File a Notice of Pendency, the Relief Sought in the Action Must Affect Title to Real Property

• Posted on: May 24 2024

By Jonathan H. Freiberger

A notice of pendency, also known as lis pendens, is a provisional remedy available to litigants seeking a judgment that affects title to real property. 5303 Realty Corp. v. O&Y Equity Corp., 64 N.Y.2d 313 (1984).¹ The rules concerning notices of pendency are found in Article 65 of the CPLR. As the name suggests, a notice of pendency puts the world on constructive notice that an action has been commenced that may affect the title to the property and, accordingly, “[a] person whose conveyance or incumbrance is recorded after the filing of the notice is bound by all proceedings taken in the action after such filing to the same extent as a party.” CPLR § 6501.

The notice of pendency is a powerful tool because “the statutory scheme permits a party to effectively retard the alienability of real property without any prior judicial review.” 5303 Realty, 64 N.Y.2d at 320. Also, while CPLR § 6514 permits a litigant to move to cancel a notice of pendency, the “court’s scope of review is circumscribed” and “the likelihood of success on the merits is irrelevant to determining the validity of the notice of pendency.” Id.

“To counterbalance the ease with which a party may hinder another’s right to transfer property” the law requires “strict compliance with the statutory procedural requirements.” Id. (citing Israelson v. Bradley, 308 N.Y. 511 (1955)). The ability to file a notice of pendency is deemed to be “an extraordinary privilege” and if “the terms imposed are not met, the privilege is at an end.” Id.

Among other requirements, a notice of pendency “is effective only if, within thirty days after filing, a summons is served on the defendant.” CPLR § 6512; see also, NYCTL 1999-1 Trust v. Chalom, 47 A.D.3d 779 (2nd Dep’t 2008) (finding a notice of pendency invalid when summons not served within 30 days). Similarly, a notice of pendency is valid for three years from the date of filing and “[b]efore expiration of a period or extended period, the court, upon motion … for good cause shown, may grant an extension for a like additional period.” CPLR § 6513. Courts have noted that any request for an extension “must be [made] prior to the expiration of the prior notice” and that this is an “exacting rule” and a “notice of pendency that has expired without extension is a nullity.” Matter of Sakow, 97 N.Y.2d 436, 442 (2002) (citations omitted). Failure to follow the rules regarding notices of pendency could yield harsh results, but for good reason. The New York Court of Appeals has held that “an expired or cancelled notice of pendency may not be refiled on the same cause of action or claim.” Id. at 443. This is known as the “no second chance” rule.

There is an exception to the “no second chance” rule relating to mortgage foreclosure actions. Section 1331 of the Real Property Actions and Proceedings Law (“RPAPL”) requires that “at least twenty days before a final judgment directing a sale [in a mortgage foreclosure action] is rendered, [plaintiff] shall file in the clerk’s office of each county where the mortgaged property is situated a notice of the pendency of the action, which shall specify, in addition to other particulars required by law, the date of the mortgage, the parties thereto and the time and place of recording.” In light of RPAPL § 1331, in certain circumstances, strict application of the “no second chance” rule would prevent the entry of a judgment of foreclosure and sale in a mortgage foreclosure action. Accordingly, CPLR 6516(a), which was enacted to address this conundrum, allows the filing of successive notices of pendency to permit compliance with RPAPL 1331 “notwithstanding that a previously filed notice of pendency in such action or in a previous foreclosure action has expired pursuant to section 6513 of this article or has become ineffective….” See U.S. Bank Trust v. Green-Stevenson, 208 A.D.3d 1202, 1203-04 (2^nd Dep’t 2022); Bank of America, N.A. v. Kennedy, 171 A.D.3d 1285, 1286-87 (3^rd Dep’t 2019). Otherwise, CPLR 6516(c) codified the common law “no second chance rule.” Id. at 1286.

Against this backdrop, on May 22, 2024, the Second Department decided Mallek v. Felmine. The plaintiff in Mallek was the contract vendee for the sale of real property who commenced an action solely to recover his down payment. Plaintiff moved to extend the time to serve a notice of pendency that was filed and the defendant, contract vendor, cross-moved to cancel same. The motion court granted plaintiff’s motion and denied defendant’s cross-motion. On defendant’s appeal, the Second Department reversed and, in so doing, stated:

Pursuant to CPLR 6501, “[a] notice of pendency may be filed only when ‘the judgment demanded would affect the title to, or the possession, use or enjoyment of, real property'” (Delidimitropoulos v Karantinidis, 142 AD3d 1038, 1039, quoting CPLR 6501). “When the court entertains a motion to cancel a notice of pendency in its inherent power to analyze whether the pleading complies with CPLR 6501, it neither assesses the likelihood of success on the merits nor considers material beyond the pleading itself; ‘the court’s analysis is to be limited to the pleading’s face'” (Nastasi v Nastasi, 26 AD3d 32, 36, quoting 5303 Realty Corp. v O & Y Equity Corp., 64 NY2d 313, 321).

Here, the complaint, on its face, only asserts causes of action to recover monetary damages and does not seek relief that would affect the title to, or the possession, use, or enjoyment of, the property. As the judgment demanded by the plaintiffs would not affect the title to, or the possession, use, or enjoyment of, the property, the Supreme Court should have granted the defendant’s cross-motion to cancel the notice of pendency and denied the plaintiffs’ motion to extend the time to serve the notice of pendency on the defendant as academic (see Delidimitropoulos v Karantinidis, 142 AD3d at 1039; DeCaro v East of E., LLC, 95 AD3d 1163, 1164).

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Had the Mallek plaintiff sued for specific performance of the real estate contract, for example, the subject of the action would have affected title to real property and a notice of pendency would have been proper.² See, e.g., Malekan v. 701-709 Chester St, LLC, 139 A.D.3d 913, 914 (2^nd Dep’t 2016); Nina Penina, Inc. v. Njoku, 30 A.D.3d 193, 194 (1^st Dep’t 2006).

Footnotes

1. Eds. Note: the background for this article was taken largely from a previous BLOG article related to notices of pendency.
2. Eds. Note: this BLOG has addressed issues related to specific performance of real estate contracts on numerous occasions. See, e.g., [here], [here], [here], [here], [here] and [here].

Jonathan H. Freiber is a partner and co-founder of Freiberger Haber LLP.

This article is for informational purposes and is not intended to be, and should not be taken as, legal advice.