DiSabatino v. Salicete

695 A.2d 1118, 1997 Del. LEXIS 180, 1997 WL 299554
Supreme Court of Delaware·Decided May 27, 1997·No. Nos. 511, 1996 and 137, 1997·Published·Cited by 7 cases

Opinion

HOLLAND, Justice.

Pending before the Court is a motion filed by the appellee, Mary Anne Salicete (“Wife”), seeking to dismiss DiS, Inc., (“DiS”) from the appeal filed in case No. 137,1997 (“DiSabati-no IF). DiS and Michael J. DiSabatino (“Husband”) jointly filed the appeal in DiSa-batino II. This Court, sua sponte, consolidated it with Husband’s earlier-filed appeal in case No. 511,1996 (“DiSabatino I”).

DiSabatino II is an appeal from a decision of the Family Court. The trial judge denied DiS and Husband’s joint motion to cancel several notices of lis pendens that Wife recorded against parcels of real estate owned by either DiS or Husband. Wife now contends that DiS does not have standing to pursue an appeal because DiS was not a [1119] party to the Family Court proceedings and because DiS never moved to intervene either in the Family Court or in this Court.

This Court has concluded that DiS, as a record property owner, had standing to pursue an action seeking to cancel the notices of lis pendens recorded by Wife against its property. The Family Court was the only appropriate forum in which DiS could seek cancellation of the notices of lis pendens under 25 Del.C. ch. 16, because Wife’s claimed interest in DiS’ real estate originated from a property division order entered by the Family Court. Therefore, DiS was not required to intervene formally in the underlying litigation between Husband and Wife in order to seek cancellation of the notices of lis pendens. Accordingly, Wife’s motion to dismiss DiS for lack of standing in DiSabatino II is denied.

Facts

Husband is the sole stockholder of DiS. As part of the proceedings ancillary to Husband and Wife’s divorce, the Family Court awarded Wife an equitable interest in DiS by order dated July 1, 1996 (“the July 1 Decision”). The July 1 Decision, among other rulings, is the subject of the appeal in DiSa-batino I.

On November 7, 1996, Wife recorded several notices of lis pendens with the Office of the Recorder of Deeds for New Castle County. Two of the notices claim Wife’s interest in two parcels of real estate for which DiS is the record owner. Two additional notices claim Wife’s interest in two other parcels of real estate for which Husband is the record owner. Wife’s notices of lis pendens identified the Family Court’s July 1 Decision as the basis for her claimed interest in DiS’ real property.

On February 24, 1997, DiS and Husband jointly filed a motion with the Family Court seeking to cancel Wife’s notices of lis pen-dens. On March 12, 1997, the Family Court denied the motion on the ground that “a lis pendens hen [is] an appropriate sanction to secure [Wife’s] interest in DiS, Inc., a marital asset.” Wife never argued to the Family Court that DiS lacked standing to seek cancellation of the notices of lis pendens. Wife did not raise the issue of standing until after DiS and Husband jointly filed their appeal in DiSabatino II.

Lis Pendens

Delaware Common Law

The doctrine of lis pendens, which in Latin means “a pending lawsuit,” historically referred to the notice given to potential buyers of real property that there was litigation pending before a court which asserted a claim that might affect title to the property in question. Cannelongo v. Fidelity Am. Small Bus. Inv. Co., Del.Supr., 540 A.2d 435, 438 (1988). The doctrine did not operate to establish an actual hen on the affected property. It merely served as equitable notice to third parties that, if they purchased the property, they purchased it subject to whatever vahd judgment ultimately might be rendered in the litigation. Id. Compare Handler Constr., Inc. v. CoreStates Bank, N.A, Del.Supr., 633 A.2d 356, 364 (1993).

In Delaware, the filing of the litigation itself was sufficient constructive notice to third parties of the claimed interest in the property. Lawyers Title Ins. Corp. v. Wolhar & Gill, P.A, Del.Supr., 575 A.2d 1148, 1153 (1990); Lockwood v. Bates, 1 Del.Ch. 435, 447 (1833). A separate recording of the notice of the litigation with the Recorder of Deeds was not necessary. Wilgus v. Salt Pond Inv. Co., Del. Ch., 498 A.2d 151, 158 (1985). Nevertheless, lis pendens notices were often filed with the Recorder of Deeds in Delaware. Id. See Handler Constr., Inc. v. CoreStates Bank, N.A, 633 A.2d at 366.

The fundamental requirements to the application of the lis pendens doctrine were that the underlying litigation be filed in good faith and that it be addressed to the title or other interests in a specific and identified parcel of land. Cannelongo v. Fidelity Am. Small Bus. Inv. Co., 540 A.2d at 438-39. Notwithstanding these requirements, however, courts recognized that the common law doctrine of lis pendens was subject to abuse. In fact, non-meritorious filings could cause substantial harm by impairing the marketability of the disputed property. Vilone v. [1120] Sea & Pines Consol. Corp., Del.Ch., 541 A.2d 135, 138 (1988).

In Vilone v. Sea & Pines, the Court of Chancery acknowledged the adverse effects that could be caused by the lis pendens doctrine. Id. The court in that case concluded, however, that the plaintiffs’ complaint stated a sufficient interest in defendants’ land to survive the defendants’ motion to cancel the effects of the lis pendens. Id. Nonetheless, the court rejected plaintiffs’ argument that the lis pendens could only be canceled upon statutory grounds. Instead the court held that it had equitable jurisdiction to fashion a remedy, as an alternative to cancellation, which would protect plaintiffs’ interests but relieve defendants from the operation of the lis pendens doctrine. Id.

Lis Pendens

Delaware Statute

In 1989, following the Vilone v. Sea & Pines decision, the Delaware General Assembly enacted 25 Del.C. ch. 16. The statute was drafted and sponsored by the Real and Personal Property Section of the Delaware State Bar Association. It was intended to codify in clear terms the protections to be afforded to real property owners against unscrupulous plaintiffs, who might misuse the lis pendens doctrine and cause irreparable harm to legitimate titleholders.

Free access — add to your briefcase to read the full text and ask questions with AI

DiSabatino v. Salicete, 695 A.2d 1118, 1997 Del. LEXIS 180, 1997 WL 299554 (Del. 1997).

695 A.2d 1118 (DiSabatino v. Salicete) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related