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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal><span style='color:#1F497D'>Dwight has set forth the issue better than I could have. The escrow instructions (at least the ones I have seen) merely tell escrow which exceptions to title are acceptable on the Title Policy, and don’t address which exceptions are approved for the deed. This results in the closer making the decision as to what warranties are being made by the seller; that is not a good thing.<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>The closer could amend the escrow instructions to set forth the warranties to be made on the deed, and I am considering doing that in our escrow instructions. This may not give any real relief since few buyers and sellers even read the escrow instructions. But at least they will have an opportunity to consider the matter.<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><div><p class=MsoNormal><span style='font-size:11.0pt;font-family:HelveticaNeueETW01-55Rg;color:#1F497D'>John McCrady<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:HelveticaNeueETW01-55Rg;color:#1F497D'>Counsel</span><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Puget Sound Title Company<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>5350 Orchard Street West<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>University Place WA 98466<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>253-476-5721<o:p></o:p></span></p></div><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><div><div style='border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>From:</span></b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> wsbarp-bounces@lists.wsbarppt.com [mailto:wsbarp-bounces@lists.wsbarppt.com] <b>On Behalf Of </b>Bickel, Dwight<br><b>Sent:</b> Thursday, September 22, 2016 6:39 PM<br><b>To:</b> WSBA Real Property Listserv <wsbarp@lists.wsbarppt.com><br><b>Subject:</b> Re: [WSBARP] Listing exceptions to title in deed versus "boiler plate" reference to exceptions of record<o:p></o:p></span></p></div></div><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'>In my personal opinion (not binding on my company in any way), this is a big issue that the escrow agents should handle very carefully such that the parties make the choices to resolve the ambiguity that is presented by the typical P&SA. The P&SA, as noted in prior post, does not provide sufficient guidance for the LPO to know what exceptions to the warranties are “pursuant to the agreement of the parties.” In my opinion, choosing the “boilerplate” or choosing to specifically list the Schedule B exceptions on the preliminary commitment are both a choice that the LPO should defer for the parties to decide.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'>Consider that the warranties of the statutory warranty deed are different than the title insurance coverage. Note that coverage varies according to the policy and the particular exceptions listed by a particular title company on the particular commitment. It is not correct that the Schedule B exceptions are the only exceptions to the warranty that may be appropriate based upon that ambiguous P&SA language about acceptable encumbrances. <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'>An example will illustrate that gap. Presume there is a long-standing boundary based upon a neighbor’s fence that is inside of the invisible survey line of the legal description of the land to be conveyed. Presume the warranty deed given lists only Schedule B exceptions. Normally, the variance between occupation by the fence and the legal description is not disclosed by the public records, so the title company will not list an exception there. However, the title company may have a general exception that applies to survey matters that are not disclosed in the public records. After the purchase, the neighbor files a quiet title action alleging ownership of a portion of the land described by that deed. The purchaser tenders that action to the seller, seeking defense and compensation for that portion of the land on the neighbor’s side of the fence. Presume that the purchaser knew about the variance and had no expectation of possessing on the other side of that fence. Do the warranties apply? Is that consistent with the ambiguous acceptable encumbrances language of the P&SA? Would it be fair and consistent for a seller to have an exception to the warranties for that fence variance? <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'>For those that don’t recognize the facts, see </span><i><span style='font-size:10.5pt;font-family:"Helvetica",sans-serif;color:#333333;background:white'><a href="http://www.northwestlandlawforum.com/wp-content/uploads/sites/317/2012/01/Edmonson-v.-Pop.opn_.pdf">Edmonson v. Popchoi</a></span></i><span style='font-size:10.5pt;font-family:"Helvetica",sans-serif;color:#333333;background:white'>, 172 W2nd. 272 (2011).</span><b><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:#002060'><o:p></o:p></span></b></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Verdana",sans-serif;color:navy'><o:p> </o:p></span></p><div class=MsoNormal align=center style='text-align:center'><hr size=1 width="100%" noshade style='color:black' align=center></div><p class=MsoNormal>NOTICE: The information contained in this message is proprietary and/or confidential and may be privileged. If you are not the intended recipient of this communication, you are hereby notified to: (i) delete the message and all copies; (ii) do not disclose, distribute or use the message in any manner; and (iii) notify the sender immediately. <o:p></o:p></p></div></body></html>