Title insurance protects your property against the past as well as the future. A policyholder is protected against challenges to rightful ownership of real property, challenges that arise from circumstances of past ownerships. Each successive owner brings the possibility of title challenges to the property. When you purchase real property, rely on Home Title to protect your interests. You’ll be insured by a company backed by more then 150 years of successful title operations – Chicago Title Insurance Company.

Easement Rejection

Betty G., a real estate broker, purchased an undeveloped lot in a rural county in Northern California. She also purchased a title insurance policy protecting not only her title to the lot but also a road easement benefiting the lot across adjoining property. The lot was the northernmost of a four-lot subdivision. The original subdivider had attempted to reserve an easement over an existing north-south road that traversed the most westerly boundary of the three southerly lots. However, the document that attempted to serve the easement was defective because it did not contain the language necessary to give record notice that an easement was being created. When the owners of the three southerly lots found out that Betty G. intended to develop her parcel by dividing it into two lots and building homes for sale, they challenged her right to use the easement. Betty G. made a claim under her title policy.

It was determined that a successful reformation action to reform the document to correctly reflect the intention of the subdivider to create an easement could be successful. It was also determined that Betty G. had the right to an easement by implication, necessity and, arguably, prescription.

Following this analysis, contact was made with each of the owners of the three southerly properties. After an explanation that Betty G. was entitled to the easement on any one of several legal theories, two of the owners readily agreed to execute the documents necessary to grant Betty G. an easement over their property.

The most southerly property holder, however, still contested Betty G.’s right to an easement. They adamantly insisted that they would only execute easement documents if Betty G. agreed not to develop her property. Obviously, that was unacceptable. Through a series of correspondence it was made very clear to the most southerly property owners that the alternative to settlement necessarily would involve litigation or other dispute resolution mechanisms. After several weeks of dialogue and correspondence, the most southerly property holders agreed to a cash settlement in exchange for a clear and unambiguous easement grant deed.

This claim was resolved in a matter of weeks. Further, because of the facts, Betty G. was able to be assured that if she wished to sell her property during the time the claim was pending, title insurance would be available to her new buyer while efforts continued to resolve the easement problem.

Betty G. stated that, as a real estate broker, she had always considered title insurance to be simply a hurdle to delay a closing. However, after having her own claim with such good results, she realized how important title insurance truly is.

Mechanics Lien Claim – Loretta’s Title Policy Covered a Mechanics Lien Claim

Loretta loved her new home. She was especially thankful for the fact that the seller replaced the roof so she would not have to spend money for the unexpected surprise of a leaking roof. She had that problem with her prior home. Much to her dismay as it turned out the seller never paid the roofing contractor. Surprise turned to frustration when the roofing contractor insisted he had a mechanics lien which he could foreclose against Loretta’s new home.

Imagine the relief when Loretta learned she could tender the problem to her title insurer to take care of the whole problem. She had a comprehensive ALTA Residential Policy that provided coverage for such liens. Her insurer contacted the roofing contractor and after a few months of negotiation the lien claim was settled and resolved. In the end Loretta was safe and secure under her new roof and she never had to fret over the contractor’s mechanics lien claim.

Property Extends On to Adjoining Land - Harvey’s Garage

Harvey was a happy new homeowner who delighted in his hobby, that is, his Harley Davidson Motorcycle. Harvey would never think to leave his Harley out of the garage and exposed to the elements. That was exactly the threat he had to face not three months after moving into his new home. It seems that some year ago, through inadvertence, a prior owner of the property built the garage two feet over onto their neighbor’s land.

One morning Harvey’s neighbor woke up to the possibility that the garage was over the property line as he thrilled to the thunderous sound of the Harley being taken out for a spin by Harvey. The next day the neighbor, Jack, contacted his surveyor.

Harvey was in a sorry state until he searched through his closing documents and found his title policy. Fortunately, the threat of a forced removal of Harvey’s garage because it extended onto adjoining land was a covered title risk in Harvey’s title policy.

Both Harvey and Jack wanted to be good neighbors, but a solution was necessary. Jack contacted his lawyer who drafted a lawsuit seeking to require Harvey to remove his garage from Jack’s land. The title insurer was notified and the insurer suggested a mediation of the dispute to spare everyone frustration and expense. Fortunately, the mediator structured a reasonable settlement which required a fair amount of sound proofing material in the garage and a cooperative neighborly respect between both Harvey and Jack. The garage was allowed to stand on its original foundation, sound proofing was added at the title insurer’s expense and a lot line adjustment was worked out, also at the insurer’s expense. Harvey and Jack could now live next to one another without controversy, thanks to Harvey’s title insurer.