THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.
Bulletin: OR000001
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Bulletin: OR000001
Dear Associates:
The Oregon Court of Appeals ruled that a title company was not liable to a lender for damages when the lender failed to act reasonably to avoid the loss. Colonial Banking v. Title Company , 766 P.2d 411 (1988).
The lender accepted a deed in lieu of foreclosure. It instructed the title company to record the deed but only if there were no other liens against the property. The title company recorded the deed in lieu but missed a recently recorded trust deed. This was a breach of the instructions.
The lender discovered the error when it was selling the property four months later. The lender sold the property, paid the omitted trust deed and sued the title company.
The court of appeals ruled against the lender. It said that the lender should have reinstated its trust deed and foreclosed out the missed trust deed. It held that this was a reasonable course of action for the lender to take to avoid the loss and that the title company was not liable under these circumstances.
References
- Bulletins Replaced:
- None
- Related Bulletins:
- None
- Underwriting Manual:
- Exceptions Manual:
- None
- Forms:
- None