Legal Question in Real Estate Law in California
I am the buyer and have performed on the purchase contract with all monies in escrow. The seller needed to obtain a signature on a reconveyance to clear title, which was the last issue to complete the transaction. Instead the seller put a cancellation notice into escrow. The real estate agent contacted C.A.R. and was informed that I had to get an attorney to file a lis pendens who would then initiate the mediation/arbitration process, which is in the contract. Do I have to hire an attorney to start this process or can we file a complaint with the D.R.E. and go to mediation/arbitration and can the seller be made to perform?
4 Answers from Attorneys
There is no requirement to hire an attorney, but unless you know to effectively represent yourself in this, hire an attorney who does. If this is in SoCAL, and you�re serious about hiring counsel, feel free to contact me. I've handled RE litigation for years. Your attorney may be able to 'persuade' the seller to perform without having to go through all the litigation expenses involved.
I don't believe that a complaint filed with the D.R.E. will help you. Hire an attorney. If your contract has an attorney fees provision, you will recover your attorney fees from the seller in addition to gettting the property if you win your lawsuit. The seller might back down rather than fight this lawsuit.
I think you are confused by what your agent is telling you. You can't record a lis pendens, called a notice of pendency of action, without an action actually being filed.
The DRE is California's Department of Real Estate. They handle complaints about people licensed by the California Department of Real Estate, such as real estate agents, brokers, and real estate appraisers. They don't handle complaints or mediation/ arbitration with a seller.
You need to speak to a competent real estate attorney, and bring the purchase and sale contract with you.
Obtaining a lawyer was suggested because Code of Civil Procedure section 405.21 allows a lawyer to sign a lis pendens (called a "notice of pendency of action" in the statutes), whereas a self-represented person must get a judge to approve it beforehand.
If your contract calls for arbitration of disputes, you cannot get a lis pendens, with or without a lawyer, even if you file a lawsuit demanding arbitration under Code of Civil Procedure section 1281.2, because a lis pendens can only be filed, served and/or recorded in a case that asserts a real-estate claim and a 1281.2 suit doesn't qualify (or so I am told).
I agree with Mr. Roach that the DRE is not the place to turn.
I haven't seen your agreement, but my hunch is that your best bet is to retain an attorney to initiate an arbitration proceeding at once. There may be some risk, probably minor, in bypassing the "mediate first" provisions, if any, of the contract. However, time is of the essence if you really want the property. I do not recommend trying to bypass the arbitration requirement (if there is one) by filing a lawsuit and lis pendens, however, unless perhaps the seller waives the arbitration clause and consents (in writing) to litigate (unlikely).
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