Law Practice Management, 0421 WYBJ, Vol. 44 No. 2 46

AuthorMark Bassingthwaight, ALPS Missoula, Montana
PositionVol. 44 2 Pg. 46

Law Practice Management

No. Vol. 44 No. 2 Pg. 46

Wyoming Bar Journal

April, 2021

A Risk Management Tip for Attorneys Who Act as Title Agents

Mark Bassingthwaight, ALPS Missoula, Montana

Sometimes the teacher becomes the student, which is exactly what happened to me during a post-CLE conversation between a panel member and an attendee that I was fortunate enough to be privy to. In short, the conversation centered around the issue of title insurers bringing claims against their attorney title agents for title search errors such as failing to find a mortgage assignment; a land subdivision; a deed entry or deed fraud; a will and probate entry; or liens, encumbrances, easements or encroachments. Defective title examinations happen and when they do, an attorney title agent will often find him or herself standing in the cross hairs of potential liability, regardless of whether a separate title examiner was involved.

Of course, when malpractice insurers are called upon to defend an attorney title agent in a defective title examination claim, they will look to any involved title examiner for contribution, if not full indemnity, if he or she really was the one responsible for the defective examination. Unfortunately, and I suspect this comes as no surprise, title examiners don’t always maintain their own errors and omissions (E & O) coverage. Tis is why legal malpractice insurers always advise their insureds to only work with title examiners who can document that they do indeed have an E & O policy in place.

Here’s where the conversation got interesting, however, at least from a risk manager’s perspective. Te attendee asked if we ever look to see if there is a provision in our insured’s contract with the title insurer that, in the event of a title search error, would require the title insurer to look to the title examiner for indemnification and not the attorney title agent. Te presence of such a provision might enable...

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