In something of a no-brainer, Division II of the Court of Appeals upheld a summary judgment in favor of First American Title against breach of contract claims brought by an insured.
The insured, Dennis Pavina, bought Lot 1 in a Vancouver area subdivision that had been created in 1988. As part of the process in creating the subdivision, the developer at that time had CC&Rs recorded which included ingress/egress easements. For some reason, two months after the CC&Rs were recorded, Lots 1 and 2 were removed from the CC&R requirements. The easements no longer benefited or burdened those lots.
Two decades later Mr. Pavlina comes along, purchases Lot 1, obtains a title insurance policy and develops the lot with an office building. Access to Lot 1 is (or would be) across Lot 2.
On the eve of completion (I always love this part) the owner of Lot 2 points out to the owner of Lot 1 that the 1988 CC&Rs don’t apply to their lots and there is no easement or access rights across Lot 2 to Lot 1.
(One can almost hear the “oh, crap” yell going up in Mr. Pavlina’s office when he hears of this).
Pavlina and the Lot 2 owner get into a bit of a row about about access that results in Pavlina paying $250,000 for an easement. (Wow).
Pavlina then tenders (throwing a hell marry more like it) to First American alleging that they should have covered his claim for an easement.
First Am says no and the court, on summary judgment and appeal, agrees and dismisses Pavlina’s claim.
Title Insurance does not extend to property you did not acquire.
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