Brief Fact Summary. The Plaintiff, Walker Rogges, Inc. (Plaintiff), retained the Defendant, Chelsea Title & Guaranty Co. (Defendant), to insure the tract of land in question. Although known to the Defendant, which was not told to Plaintiff, there was a discrepancy in the acreage of the land.
Synopsis of Rule of Law. A title company could be subject to a negligence action if the act complained of was the direct result of duties voluntarily assumed by the insurer in addition to the mere contract to insure title.
Issue. Whether a title company should be exposed to liability:
In a tort claim for negligence in searching records; and
In a liability claim under contract law for the insurance policy.
Held. Affirmed, reversed in part and remanded for a determination of whether the Defendant assumed a duty to assure the quantity of acreage and whether there was a breach of this duty.
In the absence of a recital of acreage, a title company does not insure the quantity of land. To obtain such insurance, an insured should provide the title company with an acceptable survey that recites the quantity of land.
A title company could be subject to a negligence action if the act complained of was the direct result of duties voluntarily assumed by the insurer in addition to the mere contract to insure title.
A commitment for title insurance is no more than a statement of the terms and conditions upon which the insurer is willing to issue its title policy.
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