Harrison v. Commonwealth Land Title Insurance

Opinion

THE COURT.

*

Commonwealth Land Title Insurance Company’s demurrer to Harrison’s complaint was sustained without leave to amend. Harrison appeals from the order of dismissal, which constitutes a judgment (Code Civ. Proc., § 581d; see

Weiss

v.

Marcus

(1975) 51 Cal.App.3d 590, 594, fn. 1 [124 Cal.Rptr. 297]).

[975]

In his complaint, Harrison alleged that he purchased a parcel of real property at an execution sale conducted by the Santa Clara County Sheriff on or about June 9, 1975. On or about the preceding November 11. Commonwealth Land Title Insurance Company, for a fee of $15, had issued a lot book guaranty to an attorney, John Colistra, who in the course of representing the judgment creditor, had caused the execution sale to be held. The lot book report did not disclose the encumbrance (a deed of trust) which is the basis for this litigation. Colistra showed the lot book report to Harrison. Harrison bid on the property, was high bidder, and purchased the parcel subject to the one year right of redemption on the part of the judgment debtor. In June 1976, Harrison received the sheriff’s deed, and discovered the existence of the deed of trust.

The lot book guaranty had a maximum stated liability of $100 only to the named insured, and was based solely and explicitly on the title company’s lot book records. The guaranty explicitly stated that its grantor-grantee indexes had not been examined, and it made no representation as to the state of the official public records. Printed policy exclusions limit

any

coverage to loss sustained by the party guaranteed, i.e., Colistra.

Harrison does not, apparently, attempt to recover on the contract of insurance itself. Rather, he urges that he was a person whom the title company could reasonably have expected would justifiably rely on the lot book guaranty, and that the company thus had a duty of care toward him which was breached by their failure to discover the deed of trust (see