A Comprehensive Guide: Slander of Title

As a property owner in New York, it is important to understand the legal concept of slander of title. This type of claim can arise when someone makes false statements about your property title which can cause financial harm. In this article, I will explain what slander of title is, provide examples, discuss the differences between slander of title and defamation, outline the elements of a slander of title claim, defenses against such claims, remedies available to property owners, statutes of limitations, ways to prevent such claims, and the importance of hiring a lawyer.

What is slander of title?

Slander of title is a legal claim that arises when someone makes false statements about the ownership of a piece of property. These false statements can include claims that the property is subject to liens or other encumbrances that do not actually exist, or claims that the property is owned by someone other than the true owner. The purpose of these false statements is to create doubt or uncertainty about the ownership of the property, which can make it difficult or impossible for the true owner to sell or otherwise use the property.

Elements of slander of title.

In New York, a cause of action for slander of title requires (1) a communication falsely casting doubt on the validity of the proper owner’s title, (2) reasonably calculated to cause harm, and (3) resulting in special damages.^[1] Slander of title is also known as disparagement of title. A slander of title cause of action can be asserted concerning title to both personal and real property. While the name “slander of title” insinuates it only concerns spoken words, it does include writings. It would be better articulated as defamation of title.

Examples of slander of title.

Slander of title is a tort that originated under English common law and was commonly asserted as a cause of action hundreds of years ago because most land transfers were completed orally rather than under todays systems which require written records. An example of slander of title in New York would be if someone filed a false lien against your property. This could happen if a contractor claims that you owe them money for work that was never done or if someone files a deed claiming ownership of your property, even though they have no legal right to do so.

Slander of title cases typically involve one of the following situations: ,

A person or entity falsely claims ownership of property, creating confusion and casting doubt on the true owner’s title.

A party publishes a false lien or encumbrance on someone else’s property, hindering the owner’s ability to sell or refinance the property.
A competitor makes false statements about a business property, negatively affecting the business’s reputation and causing financial harm.
A person intentionally spreads false rumors about the validity of a property’s ownership, causing damage to the owner’s ability to sell, lease, or secure financing.
A party knowingly records a fraudulent deed or document, clouding the rightful owner’s title and causing financial losses.

In each of these situations, the plaintiff must prove the required elements of slander of title, including the untrue statement, publication, knowledge of the statement being untrue or should have known, the statement was disparaging, and the plaintiff suffered damages.

What is the difference between slander of title and defamation?

While slander of title and defamation are similar in that they both involve false statements that can cause harm, they are different in terms of what they involve. Defamation involves false statements about a person or business, while slander of title involves false statements about property ownership.

Communication falsely casting doubt on the validity of the owner’s title.

A Communication falsely casting doubt on the validity of the property owner’s title refers to a false statement made by a third party that disparages or “libels” another person’s title to property and causes financial harm. This could include a communication that casts doubt on the authenticity or ownership of a property title, such as a false claim that the owner’s ownership is invalid, or a false statement that the owner’s property has liens or other encumbrances that affect its value.

Do claims concerning a property’s environmental condition cast doubt on a property’s title?

In Hirschhorn v Town of Harrison^[2] a potential purchaser entered into a contract to purchase a parcel of property from the town. During contract, town board members too appeared on television calling the property they were selling “a potential environmental disaster”, despite having no knowledge of any environmental conditions currently affecting the property. The Court determined that the statements did not affect title in the legal sense nor cast doubt as to the validity of the plaintiff’s title to the premises. The Court did state that a cause of action may be available for injurious falsehood.

Can a lis pendens (Notice of Pendency) cast doubt on the validity of the plaintiff’s title?

A lis pendens generally is an undeniably true statement and not sufficient form a basis for slander of title. Brown v Bethlehem Terrace Assoc.^[3] see also Sopher v Martin;^[4] In re Aurora Commercial Corp., 21-1332; Casa de Meadows Inc. (Cayman Is.) v Zaman.^[5] A lis pendens merely puts the plaintiff on notice that an action concerning title the the premises has been commenced, it, by definition is not false. The underlying cause of action asserted in the lawsuit would be the false statement, however, it is likely protected by privilege because it is asserted in the lawsuit. Notwithstanding, the filing of a false lis pendens maybe sufficient to assert a claim for slander of title. Sealy v Clifton L.L.C.^[6] Sealy v Clifton, LLC.^[7] In Plot Realty LLC v DeSilva^[8] the appellate division reinstated a complaint based on slander of title because of the filing of a lis pendens in connection with a nuisance and encroachment lawsuit building renovations, rather than ownership of the building.

Can the refusal to file a satisfaction of mortgage be considered slander of title?

Wrongly refusing to issue a satisfaction of mortgage is sufficient to maintain a cause of action for slander of title. In Feiner v Galpern^[9] the plaintiff commenced an action to remove a mortgage against their lender because they refused to file a mortgage satisfaction. That being said, the jury awarded damages in the amount of zero dollars.

Who doe the communication have to be with to case doubt on the validity of a plaintiff’s title?

To assert a cause of action for slander of title, a defendant must communicate their false statement to a third party – slandering title to the owner of the property will not be sufficient to establish slander of title. Tit. Ins. Co. of New York v Hawes.^[10]

Can the filing of a notice of easement be considered a communication slandering title?

Yes it can. In Hanbidge v Hunt ^[11] the court held that a notice of easement to restrict a neighboring property easement was untimely filed since damages accrued over one year prior when a purchaser refused to purchase after discovering the easement.

Does a plaintiff need to own the property to succeed on a slander title claim?

To maintain standing to be successful on a slander of title claim, the plaintiff typically must be the owner of the property. In White & Baxter, Inc. v Jade Sq. and Ltd. Tower^[12], the court dismissed a slander of title cause of action because the plaintiff had transferred title to the property to its sole shareholder, thus the plaintiff did not have standing to maintain the action. In Schuler v Rainforest All., Inc.^[13] the court held that the plaintiff did not own the property in question, therefore, they couldn’t assert a slander of title claim. Schuler involved a plaintiff that claimed to be the owner of property in Mexico, however, a Mexican court determined that they were not the owner. The plaintiff brought the lawsuit against the Rainforest Alliance for issuing a certificate concerning the true owners forrest management.

In Benderson Dev. Co., Inc. v Podd^[14] the court alluded that a slander of title claim could be maintained by a lessee. The Court in Henderson Dev. Co.., Inc. held that the defendant did not meet their burden of establishing malice (either conditional malice or common-law malice) concerning the lease. Allegations at a real estate closing in front of third parties that the plaintiff filed false estate documents and were unable to pay the estate taxes concerning the property were sufficient to sustain a claim for slander of title. Weiss v Lowenberg^[15]. The wrongful recording of a mortgage does not affect the validity of title, therefore, it cannot be slander of title. Neely v Flagstar Bank, FSB^[16].

Does a mechanic’s lien cast doubt on an owner’s title?

No, a mechanic’s lien does not cast doubt on an owner’s title. Neptune Estates, LLC v Big Poll & Son Const., LLC^[17].

Does slander of title only apply to real property?

No, a plaintiff can maintain an action for slander of title concerning personal property. To maintain an action for slander of title to personal property they must establish “(1) that the words were false; (2) that they caused an injury to him in reference to his title to the property; (3) that they were uttered maliciously, and in order to injure the plaintiff.”Holmes v Young.

Reasonably calculated to cause harm.

The phrase “reasonably calculated to cause harm” means that the statement made by the defendant must be one that a reasonable person would believe could cause harm to the plaintiff’s economic interests. In other words, the statement must be one that would tend to discourage others from buying, selling, or otherwise dealing with the owner’s property. A cause of action for slander of title will fail if they plaintiff fails to allege some form of malice or spite. Properties Hacker, LLC v City of New York,^[18].

To illustrate this concept, consider a hypothetical example. Suppose that a real estate developer is interested in purchasing a parcel of land from a property owner. However, before the sale can be completed, the developer discovers that there is a lien against the property that was filed by a third party. The third party claims that they are owed money by the property owner and that the lien gives them a legal right to the property.

If the lien is false and was filed with malice, the property owner may be able to bring a slander of title claim against the third party. However, to succeed in this claim, the property owner must demonstrate that the filing of the false lien was reasonably calculated to cause harm to their economic interests. This means that the property owner must show that the filing of the false lien was likely to discourage others from buying, selling, or otherwise dealing with the property.

In practice, this can be a difficult element to prove. The plaintiff must show that the defendant knew or should have known that their false statement was likely to cause harm to the plaintiff’s economic interests. This can require expert testimony and analysis of market conditions and other factors that may affect property values.

Is it slander of title if the person has a claim to title of the property?

The recording of a deed, writing letters to newspapers, and posting articles in newspapers, where the defendant claimed ownership is not calculated to cause harm (malice intent) if the defendant has a legitimate claim to assert a claim to ownership of the property. In Fink v Shawangunk Conservancy, Inc.^[19] the Third Department determined that the defendant had probable cause to pursue an adverse possession claim, therefore, they did not profess the requisite malice standard and dismissed the slander of title cause of action.

Is a claim for slander of title only survive if the property owner can establish ill will or spite?

A property owner can survive a motion to dismiss a slander of claim cause of action if they can establish the person making the statement knows it is false or personally harbors serious doubt about its truthfulness.^[20] Chamilia, LLC v Pandora Jewelry, LLC concerned a deceptive advertising dispute. The court held that the property owner failed to establish in depositions that any of the defendants knew their statements were false (it was also disputed whether they were false).

Does a property owner need to prove facts sufficient to prove malice?

No. On a motion to dismiss, the plaintiff is not obligated to establish evidentiary facts to support allocations of malice.^[21]

Can scriveners error in documents that impact title be a cause of action for slander of title?

No. In Iuliano v Romano^[22] the court held that a draftsman’s error in a neighboring property’s documents do not rise to ca claim of slander of title because they were not calculated.

Is the filing of a probate petition claiming the property’s value is substantially less than its value reasonably calculated to cause harm?

In Weiss v Konner^[23] the Court held that the filing of a probate petition claiming the value of a property was substantially less than the future sale price was not made with a reckless disregard for the truth, and therefore was not reasonably calculated to cause harm.

Resulting in special damages.

In a slander of title claim in New York, special damages refer to the actual financial harm suffered by the plaintiff as a result of the false statement made by the defendant. Special damages are different from general damages, which refer to the harm suffered by the plaintiff’s reputation. To recover special damages in a slander of title claim, the plaintiff must prove that they suffered actual financial harm as a direct result of the defendant’s false statement. The assertion of general damages will not suffice for establishing special damages in a slander of title action and resulting in a dismissal of the cause of action.^[24]

A slander of title claims requires that special damages not be speculatively caused by the slander, but rather definitively caused by it. In Joseph v Siegel^[25], the Court dismissed a slander of title action because the plaintiff pleaded that an agreement to purchase the premises was subject to approval from their principal. The plaintiff did not plead that the only reason for them not entering into the agreement was because of the slander of title claim.

Does special damages require itemized damages?

Generally, to establish special damages a property owner must itemize their damages. In Drug Research Corp. v Curtis Pub. Co^[26]. the Court denied a libel claim because the plaintiff failed to articulate special damages. The plaintiff in Drug Research Corp^[27]. asserted $5,000,000 in damages, however, the Court rejected the damages claim because there was no attempt at itemization, therefore it must be deemed to be a representation of general damages. The naming of specific customers lost, however, is sufficient to sustain an action for slander of title.^[28]

Defenses to slander of title.

The primary defenses to slander of title are: (1) truth, (2) lack of malice or intent to harm (good faith), (3) absolute privilege, (4) qualified privilege, and (5) statute of limitations. The first two defenses, truth and lack of malice or intent to harm are based on the property owner being unable to prove the elements of slander of title. The truth defense means that if the person making asserting the cause of action cannot establish that the claim is false, then the slander of title claim will be dismissed.

The privilege defense is based on the idea that certain parties have a legal right to make statements that might otherwise be considered slanderous. For example, a lawyer or real estate agent may make statements about a property that could be considered slanderous, but they have a legal right to do so in the course of their professional duties. Privilege is a defense that must be proved by the person asserting it.^[29] There are two forms of privilege to a slander of title claim: absolute privilege and qualified privilege.

Absolute Privilege.

The doctrine of absolute privilege completely immunizes certain classes of persons from liability for defamatory statements, even though maliciously uttered.^[30]

Is the filing of a legal complaint sufficient to maintain a cause of action slander of title?

Allegations in a complaint are subject to absolute privilege, therefore, a plaintiff may not assert a cause of action based on such statements.^[31]

Are statements made outside of litigation protected from slander of title claims?

Absolute privilege is not limited to statements made on the record during oral testimony or argument, or formal litigation documents, such as pleadings, affidavits, and briefs.^[32]

^[33]Do the statements need to be related to the litigation to be protected by absolute privilege?

In order to avail oneself of absolute privilege during litigation, the statements must be pertinent and within the scope of the litigation. The court in Seltzer v Fields ^[34] stated that “[s]ince the complaint allegation was not shown to be impertinent or beyond the scope of the issues of the previous action, its use in that action was absolutely privileged.”

Qualified Privilege.

Statements made by an elected official on a matter of public concern in which they have an interest is protected qualified privilege (otherwise known as conditional privilege).^[35] In ATN Marts, Inc., the Court found that statements by elected official concerning the town’s exchange of property for a parcel that may have been contaminated by a gasoline leak from an underground storage tank was of public interest.

Qualified privilege may be defeated by proof that the statements were made with malice.^[36] A plaintiff must establish malice by clear and conniving evidence to defeat qualified privilege. In Hirschhorn v Town of Harrison^[37] the the Court held that statements were subject to qualified immunity because they were made by town board members in a televised debate and were made without any intent to injure or with a reckless disregard for the truth.

Statute of Limitations.

The statute of limitations for a slander of title claim is one year from damages resulting from the slander.^[38] In Habidge v Hunt, the Second Department held that the cause of action for slander of title ran from the day a buyer refused to purchase the Premises, not the day of recording. The facts in Hanbidge, however, are not always applicable. The First Department in Rosenbaum v City of New York^[39] held that the cause of action accrued from the date of the filing of a lien against the property because the property owner was aware of such lien. The Court differentiated the case with Hanbidge because the property owner in Hanbidge was not injured until damages were suffered (at the time of the loss of sale), however, a lien was an immediate diminishment in property value, so the cause of action accrued from that date.

Can I assert a cause of action for slander of title after 1 year if I already started a case?

Yes, you can still assert a cause of action or slander of title if your initial complaint contained the allegations supporting a cause of action for slander of title. The standard is whether the complaint was “no patently lacking in merit, and there would be no surprise to the defendant.”^[40]

Remedies to slander of title.

If a property owner in New York successfully proves a slander of title claim, they may be entitled to several remedies. These can include: (i) Monetary damages: The plaintiff may be entitled to compensation for any financial harm they suffered as a result of the false statement; (ii) Injunction: The plaintiff may be able to obtain an injunction, which is a court order requiring the defendant to stop making false statements about the plaintiff’s property ownership; (iii) Quiet title: The plaintiff may be able to obtain a court order declaring them the rightful owner of the property in question.

Alternatives to Slander of Title

Slander of title is a unique cause of action and difficult to prove. While slander of title may not fit, there are several related causes of action that might.

First, injurious falsehood. In New York, injurious falsehood, also known as trade libel or commercial disparagement, involves the malicious publication of false statements about a plaintiff’s property, business, products or services that causes actual loss or damage to their reputation. The plaintiff must prove that the statements were false, the defendant acted maliciously, and actual economic loss has occurred or will occur as a result. The identity of the plaintiff or the plaintiff’s products must be named in the publication, but implication can be enough. Consent and truth are defenses to injurious falsehood, and the privileges of advertisement also apply. Damages in cases of injurious falsehood can be awarded as general damages, even if special damages are unproven, if harm can be shown in other ways.

Second, injury to property. In New York, injury to property is considered a tort cause of action, which falls under the broader category of torts. Injury to property occurs when someone causes harm to another person’s property, whether intentional or unintentional. Examples of injury to property can include damaging someone’s car, vandalizing their house, or destroying their personal belongings. In order for a plaintiff to succeed in an injury to property case, they must prove that the defendant’s actions caused the damage and that they suffered a financial loss as a result. A plaintiff can seek compensation for the cost of repairs or replacement of the damaged property.

Third, malicious prosecution. A cause of action for malicious prosecution may rise from the filing of a lis pendens.^[41] A claim for malicious prosecution requires the plaintiff to assert malice. An inference of malice maybe inferred if the action is filed without probable cause. In New York, malicious prosecution is a cause of action that involves the initiation or continuation of a legal proceeding without probable cause and with the intent of causing harm to another person. To prove a claim of malicious prosecution, four elements must be established: (1) the defendant initiated or continued a proceeding against the plaintiff, (2) the proceeding terminated in favor of the plaintiff, (3) there was no probable cause for the proceeding, and (4) the plaintiff acted with malice. If a plaintiff successfully proves malicious prosecution, they may be entitled to damages, including compensation for legal fees.

Conclusion

Slander of title claims can have serious financial consequences for property owners in New York. By understanding what slander of title is, how it differs from defamation, and the elements of a slander of title claim, property owners can take steps to protect themselves. If you are involved in a slander of title claim, it is important to consult with an experienced real estate lawyer who can help you navigate the legal process and protect your rights.

[1] Brown v Bethlehem Terrace Assoc., 136 AD2d 222 [3d Dept 1988]

[2] Hirschhorn v Town of Harrison, 210 AD2d 587 [3d Dept 1994]

[3] Brown v Bethlehem Terrace Assoc., 136 AD2d 222 [3d Dept 1988]

[4] Sopher v Martin, 243 AD2d 459 [2d Dept 1997]

[5] Casa de Meadows Inc. (Cayman Is.) v Zaman, 76 AD3d 917 [1st Dept 2010]

[6] Sealy v Clifton L.L.C., 34 Misc 3d 266 [Sur Ct 2011]

[7] Sealy v Clifton, LLC, 106 AD3d 981 [2d Dept 2013]

[8] Plot Realty LLC v DeSilva, 45 AD3d 312 [1st Dept 2007]

[9] Feiner v Galpern, 187 AD3d 992 [2d Dept 2020]

[10] Tit. Ins. Co. of New York v Hawes, 76 Misc 478 [App Term 1912]

[11] Hanbidge v Hunt, 183 AD2d 700 [2d Dept 1992]

[12] White & Baxter, Inc. v Jade Sq. and Tower, Ltd., 62 AD2d 963, 963 [1st Dept 1978]