[WSBARP] lis pendens

[John M. Riley III]

That is an unanswered question.

60.04.071 allows lien release upon payment and acceptance and owner or payor demand.   Sounds like you aren't there yet so I see your point.

However, 60.04.161 says explicitly that the bond guarantees payment of any judgment on the lien in favor of the lien claimant entered in any action  to recover the amount claimed in a claim of lien , or on the claim asserted in the claim of lien and the effect of recording a bond shall be to release the real property described in the notice of claim of lien from the lien and any action brought to recover the amount claimed.  So it can be asserted the bond eliminates the need for a lis pendens, whose purpose is to provide notice to the world of the claim and, secondarily,   to secure the then equity in the real property as collateral to use to  realize upon to recover the judgment amount.   Bond takes the place of the property.  I agree with the commenter who says the recording of the claim of lien serves as notice to the world.  So that purpose of the lis pendens no longer exists.  But on the issue of the bond vs the property, there is the issue of the reliability of the bond. What if the bonding company files bankruptcy or can't perform under the bond?  The statute is clear bond replaces land but bond concerns remain.

The section also says if the action to foreclose the lien is timely commenced, then on payment of any judgment entered in the action or on payment of the full amount of the bond to the holder of the judgment, whichever is less, the surety shall be discharged from liability under the bond.

Again, what happens if the bond is not performed.

Seems like once the bond is in place a  motion by your client seeking  a declaratory ruling on the issue of whether or not the lis pendens should be terminated of record should be considered.  Still leaves open the risk of attorney's fees  but a court may  be less likely to allow fees if you ask and the issue is resolved right away, so lot sales are not imperiled.

My 2 cents.


John M. Riley III
Attorney | Witherspoon * Kelley
JMR at witherspoonkelley.com<mailto:JMR at witherspoonkelley.com> | Attorney Profile <http://www.witherspoonkelley.com/john-riley-1> | vCard<http://www.witherspoonkelley.com/s/jmr.vcf>

[WK]

422 W. Riverside Ave, Ste 1100
Spokane, WA 99201
(509) 624-5265 (office)
(509) 458-2728 (fax)
witherspoonkelley.com


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From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Douglas W. Scott
Sent: Sunday, February 25, 2018 11:35 AM
To: WSBA Real Property Listserv (wsbarp at lists.wsbarppt.com)
Subject: [WSBARP] lis pendens

Client filed Lien for excavation work against a subdivision.  I foreclosed on Lien in KC Superior and recorded a Lis Pendens.  Attorney for owner will issue a 1 1/2 times bond and has demanded that the Lis Pendens then be dismissed as it is interfering with sales of the lots or he will claim atty fees under RCW 4.28.328.  I see no need to remove the lis pendens as the bond is supposed to allow the properties to sell since the bond now guarantees payment of any judgment.  Does my client have exposure for not removing the lis pendens after the bond is in place?

Douglas W. Scott
Law Offices of Douglas W. Scott
Windermere Building
1810 15th Place NW, Suite 203
Issaquah, Washington, 98027
V.  425.392.8550
F.  425-392-2829
www.davisscottlaw.com<http://www.davisscottlaw.com/>

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