1.12 Title Search and Opinion

• Library: Real Estate Transactions in Virginia (Virginia CLE) (2019 Ed.)

1.12 TITLE SEARCH AND OPINION

1.1201 Implied Title Search Duties and Implied Title Opinions. Many lawyers believe that they cannot be deemed to have given title opinions unless they have issued formal written "opinions," but this is not

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true. Absent clear agreement to the contrary, when a lawyer for a purchaser, borrower, or lender settles or approves the settlement of a transaction, the lawyer thereby impliedly warrants ¹⁵⁵ as a matter of law that (i) the lawyer, or someone under the lawyer's direct supervision and control, has conducted a 60-year title examination and (ii) there is no actual or potential defect in, or encumbrance upon, the title other than what the lawyer has explicitly disclosed to the client. Breach of these implied warranties justifies disciplinary sanctions. ¹⁵⁶

1.1202 Negligent Title Search. Not only may negligent title examination and reporting result in civil liability, ¹⁵⁷ it also may justify disciplinary sanctions. ¹⁵⁸

1.1203 Clerk's Records, Abstracts, and Indexing Errors. A lawyer is not liable for failing to discover an encumbrance or lien not correctly indexed by the clerk's office. ¹⁵⁹ However, even though it is lawful, ethical, and proper for a lawyer to rely upon records prepared by third parties (subject to disclosure and consent requirements), reliance upon erroneous records produced or furnished by anyone else does not eliminate liability. ¹⁶⁰

1.1204 Limitations and Disclaimers. There are several...