2010-04-15_County_of_Hawaii_Motion_to_Dismiss_Counter_Claim_to_Expunge_Lis_Pendens

Home

Hawaii Supreme Court determined that the lis pendens statute"should be limited to actions directl seeking to obtain title to or possession of real property (emphasis in original)." S. Utsunomiya Enterprises, Inc. v. Moomuku Country Club, 75 Haw. 480, 510, 866 P.2d 951, 966 (1994). Tn deino so, Court reasoned that a "nan-ow construction of Hawaii's lis pendens statute is counseled by sound authority recognizing the real potential for abuse of lis pendens." Although a lis pendens statute is designed only to give notice to third parties and not to aid plaintiffs in pursuing their claims,the Hawaii Supreme Court acknowledged: [The] practical effect of a recorded lis pendens is to render a defendant's property unmarketable and unsuitable as security for a loan. The financial pressure exerted on the property owner may be considerable, forcing him to settle not due to the merits of the suit but to rid himself of the cloud upon his title. The potential for abuse is obvious (emphasis added). Id. at 512, 866 P.2d at 967,see also, TSA Intern. Ltd. v. Shimizu Corp., 92 Hawaii 243, 990 P.2d 713 (1999);Matter of 2003 and 2007 Ala Wai Blvd., City and County of Honolulu, 85 Hawaii 398, 944 P.2d 1341 (Haw.App. 1997). The Hawaii Supreme Court thereafter determined that a lis pendens is not merely a notice instrument,but is in fact an"encumbrance"because a lis pendens itself operates as a burden on the property, tending to lessen the value or interfere with its free enjoyment, separate and apart from the underlying claim. S Utsunomiya at 503, 866 P.2d 963. Accordingly,the Court found persuasive authority holding that the lis pendens statute must be strictly construed. The Court stated: "we find more persuasive the authority that holds that the lis pendens statute must be strictly construed and that the application of lis pendens should be limited to actions directly seeking to obtain title or possession of real property." Id.,see also,Kaapu v. Aloha Tower Development Corp., 72 Haw. 267, 269, 814 P.2d 396, 397 (1991)("although doctrine of lis pendens may be applied in actions other than foreclosures, we agree with courts which restrict the application of the doctrine, in order to avoid its abuse.") 14