Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 225 Second Substitute (2016GS)

Sponsor

Sen. Weiler, T.

Final action

Governor Signed 3/25/2016

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• adds additional filing requirements;
• affirmatively prohibits filing a notice of pendency of action until the underlying action has been filed;
• adds additional standards for release of the notice when the underlying action is for specific performance;
• revises requirements relating to the contents of the notice;
• adds specific civil liability and damage provisions when a notice of pendency is improperly filed; and
• makes technical corrections.

Every vote on this bill

Bill text

NOTICE OF PENDENCY OF ACTION AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Todd Weiler
House Sponsor: 
V. Lowry Snow
LONG TITLE
General Description:
This bill modifies provisions relating to the filing of a notice of pendency of action
against real property.
Highlighted Provisions:
This bill:
▸ adds additional filing requirements;
▸ affirmatively prohibits filing a notice of pendency of action until the underlying
action has been filed;
▸ adds additional standards for release of the notice when the underlying action is for
specific performance;
▸ revises requirements relating to the contents of the notice;
▸ adds specific civil liability and damage provisions when a notice of pendency is
improperly filed; and
▸ makes technical corrections.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
78B-6-1303
, as enacted by Laws of Utah 2008, Chapter 3
78B-6-1304
, as enacted by Laws of Utah 2008, Chapter 3
ENACTS:
78B-6-1304.5
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
78B-6-1303
 is amended to read:
78B-6-1303.
Lis pendens -- Notice.
(1) [
Either
] 
(a) Any
 party to an action [
affecting
] 
filed in the United States District
Court for the District of Utah, the United States Bankruptcy Court for the District of Utah, or a
Utah district court that affects
 the title to, or the right of possession of, real property may file a
notice of [
the
] pendency of [
the
] action [
with the county recorder in the county where the
property or any portion of the property is located
].
(b) A party that chooses to file a notice of pendency of action shall:
(i) first, file the notice with the court that has jurisdiction of the action; and
(ii) second, record a copy of the notice filed with the court with the county recorder in
the county where the property or any portion of the property is located.
(c) A person may not file a notice of pendency of action unless a case has been filed
and is pending in a United States or Utah district court.
(2) The notice shall contain:
(a) the 
caption of the case, with the
 names of the parties 
and the case number
;
(b) the object of the action or defense; and
(c) [
a
] 
the specific legal
 description of 
only
 the property affected [
in that county
].
(3) From the time of filing the notice, a purchaser [
or
]
, an
 encumbrancer of the
property [
who
]
, or any other party in interest that
 may be affected by the action is considered to
have constructive notice of [
the
] pendency of [
the
] action.
Section 2. Section 
78B-6-1304
 is amended to read:
78B-6-1304.
Motions related to a notice of pendency of an action.
(1) Any time after a notice has been [
recorded
] 
filed
 pursuant to Section 
78B-6-1303
,
any of the following may make a motion to the court in which the action is pending to release
the notice:
(a) a party to the action; or
(b) a person with an interest in the real property affected by the notice
, including a
prospective purchaser with an executed purchase contract
.
(2) A court shall order [
a
] notice 
of pendency of action
 released if:
(a) the court receives a motion to release under Subsection (1); and
(b) 
after a notice and hearing if determined to be necessary by the court,
 the court finds
that the claimant has not established by a preponderance of the evidence the [
probable
] validity
of the real property claim that is the subject of the notice.
(3) In deciding a motion under Subsection (2), if the underlying action for which a
notice of pendency of action is filed is an action for specific performance, a court shall order a
notice released if:
(a) the court finds that the party filing the action has failed to satisfy the statute of
frauds for the transaction under which the claim is asserted relating to the real property; or
(b) the court finds that the elements necessary to require specific performance have not
been established by a preponderance of the evidence.
[
(3)
] 
(4)
 If a court releases a 
claimant's
 notice pursuant to this section, [
the
] 
that
claimant may not record another notice with respect to the same property without [
approval of
]
an order from
 the court in which the action is pending 
that authorizes the recording of a new
notice of pendency
.
[
(4)
] 
(5)
 Upon a motion by any person with an interest in the real property that is the
subject of a notice 
of pendency
, a court may
, at anytime after the notice has been recorded,
require
, as a condition of maintaining the notice, that
 the claimant [
to give
] 
provide security to
the moving party [
a guarantee as a condition of maintaining the notice: (a) any time after a
notice has been recorded; and (b)
] 
in the amount and form directed by the court,
 regardless of
whether the court has received an application to release under Subsection (1).
[
(5)
] 
(6)
 A person who receives [
a guarantee
] 
security
 under Subsection [
(4)
] 
(5)
 may
recover 
from the surety
 an amount not to exceed the amount of the [
guarantee
] 
security
 upon a
showing that:
(a) the claimant did not prevail on the real property claim; and
(b) the person [
seeking the guarantee
] 
receiving the security
 suffered damages as a
result of the maintenance of the notice.
(7) The amount of security required by the court under Subsection (5) does not
establish or limit the amount of damages or reasonable attorney fees and costs that may be
awarded to a party who is found to have been damaged by a wrongfully filed notice of
pendency.
[
(6)
] 
(8)
 A court shall award costs and attorney fees to a prevailing party on any motion
under this section unless the court finds that:
(a) the nonprevailing party acted with substantial justification; or
(b) other circumstances make the imposition of attorney fees and costs unjust.
Section 3. Section 
78B-6-1304.5
 is enacted to read:
 78B-6-1304.5.
Civil liability for recording wrongful notice of pendency --
Damages.
A person is liable to the record owner of real property, or to a person with a leasehold
interest in the real property that is damaged by the maintenance of a notice of pendency, for
$10,000 or for treble actual damages, whichever is greater, and for reasonable attorney fees and
costs, if the person records or causes to be recorded a notice of pendency against the real
property, knowing or having reason to know that:
(1) legal action against the property has not been filed as required by Section
78B-6-1303
;
(2) the notice is groundless;
(3) the notice fails to comply with the notice requirements of Subsection
78B-6-1303
(2); or
(4) the notice contains an intentional material misstatement or false claim.