California-Hawaii Development, Inc. v. Superior Court

In California-Hawaii Development, Inc. v. Superior Court (1980) 102 Cal.App.3d 293, lis pendens had been filed with respect to a lawsuit, the 14th cause of action of which sought recission of a foreclosure sale. The trial court granted a defense summary judgment motion as to the recission cause of action and then granted a motion to expunge lis pendens on the ground that the recission cause of action was "no longer in issue." We granted a petition for writ of mandate, concluding that the cause of action was still "pending" within the meaning of Code of Civil Procedure section 409 because the plaintiff still had an opportunity to appeal the trial court ruling during any appeal from an adverse judgment on the complaint. In addition, because of ambiguity in the wording of Code of Civil Procedure section 409.1, we undertook to suggest a reading of the section which would make it more meaningful to the party seeking to expunge. The section provides that the court in which an action is pending "shall. . . order that the notice be expunged, unless the party filing the notice shows to the satisfaction of the court, by a preponderance of the evidence, that:. . . (b). . . the party recording the notice has commenced or prosecuted the action for a proper purpose and in good faith." On its face, the section is subject to an interpretation that in order to avoid expungement the party resisting the motion need show by a preponderance of the evidence only that he commenced the action in good faith and with a proper purpose. Prosecution beyond the trial court level could be for a totally improper reason or in bad faith. We concluded that the section should be read to require that a party recording notice, losing in the trial court, and prosecuting an appeal, prove to the court that his prosecution to the present stage was in good faith and for a proper purpose. We further suggested that if a party was attempting to retain a lis pendens after a trial court ruling, "the merits of the trial court ruling should play an important role in determining whether a lis pendens should be expunged." (102 Cal.App.3d at pp. 299-300.)