The United States District Court for the District of Utah recently granted a title insurance company’s motion for summary judgment in part, holding it was not required to tender a payment within 30 days of accepting its insured’s claim, and denied the motion in part because there were issues of fact as to the proper date of loss under an owner’s policy. See Marcantel v. Stewart Title Guar. Co., 2017 WL 5991734 (D. Utah Dec. 1, 2017). In the case, the plaintiff insured purchased a property and obtained a title insurance policy from the defendant title insurance company. Six months later, the insured received an offer to purchase the property for $1,900,000, but the purchaser subsequently discovered a previously undisclosed sewer easement on the property and offered $1,400,000 instead. The insured then sent the title insurance company a letter demanding $745,000 and, three weeks later, filed this action. The title insurance company then accepted the claim and informed the insured that it would obtain an appraisal to determine the insured’s loss. Two months later, it sent the insured a check for $68,000, along with appraisals of the property with and without the easement as of the date the insured purchased the property. The insured refused to accept the check and continued with this action. The title insurance company then filed a motion for summary judgment.
The Court granted the title insurance company’s motion in part and denied it in part. First, the Court granted the motion to the extent the title insurance company argued that its attempted payment to the insured was timely. The insured had argued that the title insurance company had 30 days from the date it accepted the claim to make a payment because the policy states, “[w]hen liability and the extent of loss or damage have been definitely fixed in accordance with these Conditions, the payment shall be made within 30 days.” However, the Court held that the acceptance of a claim did not mean the extent of loss has been “definitively fixed,” and to hold otherwise would be “absurd” because it would deprive the title insurance company of some of its options when accepting a claim, such as litigating to clear a title defect. Second, the Court denied the motion because it held there were factual disputes as to whether the title insurance company’s tender of payments was sufficient under the policy. Among other things, the Court found that there were issues of fact as to what date should be used in calculating the insured’s loss, and whether the title insurance company’s appraisals appropriately determined the loss.