- Bookmark
- Share
- CaseIQ
DAUGHARTY v. DAUGHARTY
Factual and Procedural Background
The case involves an appeal by the former husband from an order denying his motions to require his former wife to post a security bond related to her notice of lis pendens on property he received pursuant to a final judgment of dissolution of marriage. The wife had filed a notice of lis pendens on the property, and the husband sought either to cancel the lis pendens or require a bond. The trial court denied these motions, finding that the wife was entitled as a matter of law to maintain the lis pendens. This appeal challenges that ruling.
Legal Issues Presented
- Whether the former wife had a legal right as a matter of law to maintain a notice of lis pendens in an action seeking to vacate a final judgment of dissolution of marriage on grounds of alleged fraud.
- Whether the trial court erred by denying the former husband's motions to cancel the lis pendens or require the wife to post a security bond without considering the merits of those motions.
- Whether the trial court has discretion to require a bond or impose conditions on the maintenance of a lis pendens in cases not founded on a duly recorded instrument.
Arguments of the Parties
Appellant's Arguments
- The trial court erred in concluding the wife had an absolute right to maintain the notice of lis pendens as a matter of law.
- The husband's motions to cancel the lis pendens or require a security bond should have been considered on their merits rather than denied solely on the basis of the wife's asserted right.
- The case is distinguishable from Albega Corp. v. Manning because it is not an action founded on a duly recorded instrument but rather a fraud-based action under Fla.R.Civ.P. 1.540(b) to vacate a dissolution judgment.
Appellee's Arguments
- The wife relied on Albega Corp. v. Manning to assert a right to maintain the lis pendens without posting bond or cancellation.
- The trial court accepted that the wife was entitled to maintain the lis pendens as a matter of law based on this precedent.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Albega Corp. v. Manning, 468 So.2d 1109 (Fla. 1st DCA 1985) | Lis pendens may be maintained as a matter of right in actions founded on a duly recorded instrument. | The trial court relied on this case to find the wife had a right to maintain lis pendens; the appellate court rejected this reliance as misplaced because the instant case is not founded on a recorded instrument. |
| Berkley Multi-Units, Inc. v. Linder, 464 So.2d 1356 (Fla. 4th DCA 1985) | Distinguishes actions founded on recorded instruments from fraud-based actions; trial court has discretion to require bond in non-instrument-based lis pendens cases. | Used to explain that the present case, involving fraud allegations, does not grant an absolute right to maintain lis pendens without bond; discretion applies. |
| Mohican Valley, Inc. v. MacDonald, 443 So.2d 479 (Fla. 5th DCA 1984) | In fraud-based actions, lis pendens is permitted but trial courts may require bond to protect defendants from wrongful clouds on title. | Supports the principle that lis pendens in fraud cases is not absolute and bond may be required; quoted extensively to clarify the court’s discretion. |
| Hough v. Bailey, 421 So.2d 708 (Fla. 1st DCA 1982) | Related precedent concerning lis pendens and property interests. | Referenced to support the distinction between actions founded on recorded instruments and those based on fraud or other grounds. |
| Florida Peach Corp. of America v. Lurie, 411 So.2d 339 (Fla. 5th DCA 1982) | Illustrates a fraud-based suit where lis pendens is permitted but bond may be required. | Quoted in MacDonald to highlight the discretionary authority of trial courts to require bond in fraud-related lis pendens cases. |
| Kent v. Kent, 431 So.2d 279 (Fla. 5th DCA 1983) | Concurring opinion emphasizing the test for requiring bond when lis pendens clouds title beyond mere notice. | Supports the principle that bond should be considered if lis pendens creates a new cloud on title, not merely giving notice of a recorded instrument. |
Court's Reasoning and Analysis
The court analyzed the nature of the underlying action, distinguishing it from cases founded on duly recorded instruments, such as mortgages or deeds. The wife’s lis pendens arose from an attempt to vacate a dissolution of marriage judgment on grounds of fraud, which is not founded on a recorded instrument but rather on alleged misconduct. The court explained that while lis pendens may be proper in such cases, the trial court retains discretion to require a security bond to protect the property owner and other interested parties from an improper cloud on title. The court criticized the trial court’s reliance on Albega, which applied only to actions founded on recorded instruments, and instead applied principles from Linder, MacDonald, and related cases. The appellate court therefore reversed the denial of the husband’s motions and remanded for the trial court to reconsider whether the wife may maintain the lis pendens and whether bond or other conditions should be imposed.
Holding and Implications
REVERSED and REMANDED.
The court held that the former wife does not have an absolute right to maintain a notice of lis pendens in a fraud-based action to vacate a dissolution judgment and that the trial court must exercise its discretion to determine whether the lis pendens should be allowed and whether a security bond or other conditions are appropriate. The direct effect is that the trial court must reconsider the husband's motions with these principles in mind. No new legal precedent was created; rather, the court clarified the application of existing law distinguishing recorded instrument cases from fraud-based actions.
THOMPSON, Judge.
The former husband appeals an order denying his motions to require his former wife to post a security bond in connection with her notice of lis pendens on property he received under the final judgment of dissolution of marriage, or to cancel, dissolve and discharge the notice of lis pendens. We reverse.
The former husband contends that the trial court erred in finding that the wife had a right as a matter of law to maintain her notice of lis pendens, and thus erroneously denied the husband's motions to cancel the lis pendens or to set security bond without considering the merits of the motions. The order appealed specifically found that "the plaintiff is entitled to maintain a lis pendens as a matter of law." Based on this finding, the court denied the motions of the defendant to set a security bond or to cancel, dissolve and discharge the lis pendens. The trial court cited Albega Corp. v. Manning, 468 So.2d 1109 (Fla. 1st DCA 1985) as authority for its finding that the wife could maintain her lis pendens as a matter of right. The court's reliance on Albega is misplaced.
The instant case, unlike Albega, is not an action "founded on a duly recorded instrument" within the meaning of § 48.23(2), Fla. Stat. Instead, it is a Fla.R.Civ.P. 1.540(b) action to vacate an original final judgment of dissolution of marriage because of alleged fraud on the part of the husband in procuring the judgment. If the relief sought is granted, the result will be that the disposition of marital property made by the court in the final judgment of dissolution, including the disposition of the real property named in the wife's notice of lis pendens, will be set aside. Notwithstanding that title to the real property may be affected, this remains an action founded on fraud and not on a duly recorded instrument. Berkley Multi-Units, Inc. v. Linder, 464 So.2d 1356 (Fla. 4th DCA 1985); Mohican Valley, Inc. v. MacDonald, 443 So.2d 479 (Fla. 5th DCA 1984); Hough v. Bailey, 421 So.2d 708 (Fla. 1st DCA 1982). In MacDonald, a case very similar to the instant case in many respects, the court pointed out that while a lis pendens is permitted and may be proper in cases not founded on a recorded instrument, the trial judge has authority and discretion to require a bond to indemnify the defendants should the lawsuit fail. The court stated:
The lawsuit here, like the lawsuit in Florida Peach [Florida Peach Corp. of America v. Lurie, 411 So.2d 339 (Fla. 5th DCA 1982)] is not founded on a duly recorded instrument. The plaintiff calls it a quiet title suit, but it is not. It is a shareholders derivative suit to cancel a deed fraudulently transferred. That is a lawsuit founded on fraud or other tortious misconduct. It is a suit by an individual as a corporate shareholder, on his behalf and on behalf of the corporation to correct the misdeeds of corporate directors, officers or employees. While it seeks to correct the misconduct which incidentally involves a deed, it is not founded upon the deed itself. A lis pendens is permitted and proper in these cases but the trial judge has the authority and discretion to require a bond to indemnify the defendants in case the lawsuit fails. Like injunctions, which have the potential of irreparable injury to a wrongly sued defendant, a judge should set a reasonable bond when the reasonable exercise of his discretion requires. This is not so in cases directly involving an instrument of record where it is clear no further cloud on the title results by the filing of the lis pendens. See Kent v. Kent, 431 So.2d 279 (Fla. 5th DCA 1983), Cowart, concurring. The test is simple: if the lis pendens places a cloud on the title that did not exist then a bond should be considered. If the lis pendens does nothing more than give notice of a lawsuit on an instrument of record, which instrument itself is notice of the plaintiff's interest then no bond is required or permitted.
443 So.2d at 481.
As the court stated in Linder:
An action to foreclose a mortgage on real property is an action "founded on a duly recorded instrument."
In contrast, the recording of a conveyance such as a warranty deed serves as notice that the grantor has relinquished to the grantee all of his right, title and interest in the real property. The "recorded instrument" is notice of the grantee's ownership and therefore interest in the real property. It also serves as notice that the grantor no longer has any interest in the real property. If it is later claimed by the grantor that the grantee fraudulently or otherwise wrongfully obtained title and an action is brought to rescind the deed, the plaintiff is not entitled as of right to file a notice of lis pendens. The action is not founded on the deed but on circumstances preceding and surrounding the execution of the deed. A notice of lis pendens alerts to the possibility of rescission of the deed, a cloud on title not evident from inspection of the bare deed on the public records. Because of its potential to cloud title it is subject to scrutiny by the court for the protection of the title, the property owner, and existing lienholders, as well as the interests of the plaintiff. Thus, the statute requires that the court "control and discharge the notice of lis pendens as the court may grant and dissolve injunctions."
The order denying the former husband's motions is reversed and the cause is remanded to the trial judge for reconsideration of the motions. The trial judge shall exercise his discretion as to whether the wife shall be permitted to maintain her lis pendens and, if so, whether equity may require the posting of bond or the imposition of other conditions or limitations.
REVERSED and REMANDED.
BOOTH, C.J. and MILLS, J., concur.
Alert