[WSBARP] Title insurance and 3 year issue

Tue Jan 10 11:44:01 PST 2017

It seems more inconsistent between title companies than it probably really is in practice. Nobody should rely upon posts about what a title company officer may have said or done in a particular instance. There have been some cases that I agreed to insure within a year without a surcharge. There have been other cases that I declined to insure after seven years. Basic guidelines may be more helpful:

Any period of time since a sale poses an extra risk of a challenge to the sale and a loss covered by a new owner's policy. A title company should consider every year that passes is a reduction of that unknown risk potential.

Within one year any person can easily set aside a default.
After three years (as noted by several) certain limited rights to challenge the sale expire.
Within seven years, there can be a challenge by any person based upon lack of proper service.

The period that is my starting point for analysis is seven years, based on the color of title of a foreclosure deed, actual possession and payment of taxes. See 7.28.070<https://app.leg.wa.gov/rcw/default.aspx?cite=7.28.070>

Adverse possession under claim and color of title-Payment of taxes.
Every person in actual, open and notorious possession of lands or tenements under claim and color of title, made in good faith, and who shall for seven successive years continue in possession, and shall also during said time pay all taxes legally assessed on such lands or tenements, shall be held and adjudged to be the legal owner of said lands or tenements, to the extent and according to the purport of his or her paper title. All persons holding under such possession, by purchase, devise or descent, before said seven years shall have expired, and who shall continue such possession and continue to pay the taxes as aforesaid, so as to complete the possession and payment of taxes for the term aforesaid, shall be entitled to the benefit of this section.

Any voluntary deed given by those who have possible rights under the former owner to challenge the sale is a valuable reduction of that risk.

Dwight Bickel

From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of John McCrady
Sent: Tuesday, January 10, 2017 9:33 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Title insurance and 3 year issue

Different underwriters, sometimes within the same Title Insurer, view the risks differently.  As to the three year rule in the cited 4.16.090, see Marcom v Brunner 30 Wash.App 532:

....Failure of the county treasurer to comply with the statutory provisions relating to the content and manner of service of notice in proceedings to collect delinquent taxes leaves the court without jurisdiction over tax foreclosure proceedings. Furthermore, any foreclosure sale and tax deed issued pursuant thereto is rendered void. Pierce County v. Evans, 17 Wash.App. 201<https://www.casemakerlegal.com/SearchResult.aspx?searchFields%5bstate%5d=&query=17+Wash.App.+201&juriStatesHidden=&searchCriteria=Citation&tabAction=ALLC&dtypeName=&headAdmin=&headCaselaw=&headStatutes=&searchType=overview&jurisdictions.allStates=on&jurisdictions.includeRelatedFederal=on&pinCite=y>, 563 P.2d 1263<https://www.casemakerlegal.com/SearchResult.aspx?searchFields%5bstate%5d=&query=563+P.2d+1263&juriStatesHidden=&searchCriteria=Citation&tabAction=ALLC&dtypeName=&headAdmin=&headCaselaw=&headStatutes=&searchType=overview&jurisdictions.allStates=on&jurisdictions.includeRelatedFederal=on&pinCite=y> (1977). Accord Rosholt v. Snohomish County, 19 Wash.App. 300<https://www.casemakerlegal.com/SearchResult.aspx?searchFields%5bstate%5d=&query=19+Wash.App.+300&juriStatesHidden=&searchCriteria=Citation&tabAction=ALLC&dtypeName=&headAdmin=&headCaselaw=&headStatutes=&searchType=overview&jurisdictions.allStates=on&jurisdictions.includeRelatedFederal=on&pinCite=y>, 575 P.2d 726<https://www.casemakerlegal.com/SearchResult.aspx?searchFields%5bstate%5d=&query=575+P.2d+726&juriStatesHidden=&searchCriteria=Citation&tabAction=ALLC&dtypeName=&headAdmin=&headCaselaw=&headStatutes=&searchType=overview&jurisdictions.allStates=on&jurisdictions.includeRelatedFederal=on&pinCite=y> (1978). Nevertheless, Brunner contends, citing RCW 4.16.090, [1<https://www.casemakerlegal.com/docView.aspx?DocId=7223554&Index=D%3a%5cdtsearch%5cindex%5c01Test%5cALL%5fCITED%5fCASE&HitCount=19&hits=10b+10c+10d+146+147+148+17d+17e+17f+2ba+2bb+2bc+36c+36d+36e+3cf+3d0+3d1+52e+&isFirstPass=&categoryAlias=Case%20Law&fCount=6&cf=0&dt=CASE&jurisdictions.allFederal=False&jurisdictions.allStates=False&searchType=BROWSE&bReqSt=WA&dataT=CASE#FN1>] the Morcoms were not "original owners" 30 Wn.App. 534 continuing in possession and did not commence this action to clear title until August 1978, more than 4 years after issuance and recording of [635 P.2d 780] the tax deed, and therefore can no longer assert a claim for superior title. The legislature, in enacting RCW 4.16.090, intended that its provisions would apply only in those instances where possession had been taken by the purchaser under the tax deed. Kupka v. Reid, 50 Wash.2d 465, 312 P.2d 1056<https://www.casemakerlegal.com/SearchResult.aspx?searchFields%5bstate%5d=&query=312+P.2d+1056&juriStatesHidden=&searchCriteria=Citation&tabAction=ALLC&dtypeName=&headAdmin=&headCaselaw=&headStatutes=&searchType=overview&jurisdictions.allStates=on&jurisdictions.includeRelatedFederal=on&pinCite=y> (1957). Brunner never has taken possession of the property. Accordingly, she cannot avail herself of the provisions of RCW 4.16.090 as a defense or bar to Morcom's quiet title action.....

Title Insurers remain concerned about lack of service on any interested party, whether fee owner, mortgagee, etc.

John McCrady
Counsel
Puget Sound Title Company
5350 Orchard Street West
University Place WA 98466
253-476-5721

From: wsbarp-bounces at lists.wsbarppt.com<mailto:wsbarp-bounces at lists.wsbarppt.com> [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Doris Eslinger
Sent: Tuesday, January 10, 2017 8:39 AM
To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com<mailto:wsbarp at lists.wsbarppt.com>>
Subject: Re: [WSBARP] Title insurance and 3 year issue

I spoke with Chicago, First American and Old Republic recently on the subject and all will issue title insurance after 3 years for WA properties and may also issue title insurance before three years for the right price, and on a case by case basis.  First American cited RCW 4.16.090 for the three-year window.  Old Republic agrees to issue title within 3 years on one case but the premium is 10% of the insured amount.   One of the title officers I spoke with mentioned that if we can locate the former property owner to sign a deed, then they can issue the insurance.

Regards,

Doris Eslinger
Attorney at Law
Eslinger Law Office, PLLC
2200 112th Ave NE | Suite 200 | Bellevue, WA 98005 | Phone: (425) 451-3237 |
Fax: (425) 633-2468 | doris at eslingerlawoffice.com<mailto:doris at eslingerlawoffice.com> | eslingerlawoffice.com<http://www.eslingerlawoffice.com/>

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From: wsbarp-bounces at lists.wsbarppt.com<mailto:wsbarp-bounces at lists.wsbarppt.com> [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of John McCrady
Sent: Monday, January 09, 2017 4:45 PM
To: WSBA Real Property Listserv
Subject: Re: [WSBARP] Title insurance and 3 year issue

I can tell you that Stewart will insure (on a case by case basis) after three years, and before three years if the buyer obtains a certification through Tax Title Services.
You can give me a call if you like for more specifics.

John McCrady
Counsel
Puget Sound Title Company
5350 Orchard Street West
University Place WA 98466
253-476-5721

From: wsbarp-bounces at lists.wsbarppt.com<mailto:wsbarp-bounces at lists.wsbarppt.com> [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Schmidt & Yee
Sent: Friday, January 06, 2017 12:41 PM
To: wsbarp at lists.wsbarppt.com<mailto:wsbarp at lists.wsbarppt.com>
Subject: [WSBARP] Title insurance and 3 year issue

Good Afternoon:
Recently there was a discussion about having a tax deed and title companies being unwilling to issue title insurance until 3 or 10 years has passed.  Due to a new computer, I lost my emails saved and would appreciate it if someone could tell me if they know of a title company closing sales and issuing title insurance after 3 years instead of 10 years or the filing of a quiet title action.
Thank you.
Pam Yee
Schmidt & Yee, PC
Aloha, OR  97078
503-642-7641
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