Slander of title occurs when someone publishes an untrue and disparaging statement about another person’s real property -- meaning a home, building, or parcel of land -- and the statement could have a negative impact on the property's value. This article discusses what a successful slander of title claim requires and the types of damages available to a successful plaintiff.
Some states follow common law (which just means court decisions in the state) rules for slander of title cases, and others have statutory definitions in place.
Whether common law or statutory, the elements for slander of title vary slightly from state to state, but the essential elements are typically:
“Publication” in a slander of title claim often refers to recording a false claim against the plaintiff’s property in some kind of public record, for example a mechanic’s lien. However, a “publication” is any communication made by the defendant to someone other than the plaintiff.
Many states, whether following common law or statutory slander of title rules, require that the defendant made the slanderous statement with “malice.” With the exception of some legal distinctions dealing with burden of proof at trial, when a defendant makes a statement that he or she knew was untrue, or when the defendant had no basis to believe the statement was true, that qualifies as “malice.” In other words, to satisfy the malice requirement, the defendant does not necessarily need to be “out to get” the plaintiff.
A plaintiff must typically show what are called “special damages” to prove his or her slander of title case. This means that a defendant might knowingly make an untrue statement about the plaintiff’s property, but if the statement did not cause “special damages,” the slander of title claim will fail.
Special damages in slander of title claims include any provable economic damages resulting from the slander, for example a cancelled lease, and the expenses necessary to clear up the slander, including legal fees. Note that the “special damages” legal fees are not what the plaintiff pays his or her attorneys to sue for slander of title, but prior legal fees paid to, for example, clear a public record or to get a court’s declaratory judgment about who owns the property.
A defendant can claim the defense of privilege in two very limited circumstances. The first circumstance is called a conditional privilege. A conditional privilege to slander of title exists when a defendant has a reasonable basis to believe what he is saying about the plaintiff’s property. Just like the requirement of “malice” in some states, the conditional privilege is just another way of saying the defendant should have known the statement was untrue or had no reasonable basis to believe it was true.
Another privilege, which exists in all jurisdictions, is the absolute privilege to make otherwise slanderous statements against the plaintiff’s title in judicial proceedings, for example statements made during litigation. If either an absolute or a conditional privilege applies, the plaintiff will lose the slander of title case even if all of the other elements are satisfied.
Whatever special damages (discussed above) the plaintiff proved to satisfy the elements of slander of title are the same damages a defendant must pay if the defendant loses the case. This includes anything the plaintiff was required to pay to repair the title, including attorney fees, as well as damages the plaintiff can prove were directly caused by the slander, for example a blown real estate deal.
Many states also permit punitive damages in slander of title claims. Punitive damages are usually calculated based on the resources (wealth) of the defendant and are designed to punish intentional wrongdoing and deter future bad conduct. If the defendant made intentionally false statements about the plaintiff’s property, and the state allows punitive damages for slander of title, the plaintiff may be entitled to damages significantly beyond the immediate effect of the slander.