Lance R. Pomerantz
Attorney at Law

Land     Title     Law

“Constructive Notice”  The  Newsletter

Excerpted from the January 17, 2014 mailing of "Constructive Notice":

Title Agent’s Mistake

Does Not Amount to Fraud

The Agent determined that access to the insured parcel was over a particular Right of Way. After closing, questions arose concerning the access rights. The Agent reviewed the issue, decided that its original position was sound and reaffirmed it to the Insureds attorney. Eventually, the courts determined that the parcel was not benefited by the Right of Way. The Insured sued the underwriter for fraud, claiming that the Agents continued representation was made with knowledge of its falsity for the purpose of inducing plaintiff to refrain from filing a claim under the policy.

The Third Department held that the evidence would not support a reasonable inference either that [the Agents] employees knew that their representations regarding the ROW were false or that plaintiff relied on them. McColgan v Brewer, 2013 NY Slip Op 08492, (App. Div., 3rd Dept., December 19, 2013).

(Kudos to Constructive Notice subscriber Edward M. Tobin, Esq. and his team at Fidelity National Law Group on their impressive win.)


The evidence showed that two Agency employees undertook several investigations of the problem and independently reached the same sincere (albeit, incorrect) conclusion. In addition, the Insureds counsel undertook his own independent investigation and arrived at the same conclusion! Ultimately, the Insured relied on his own counsels opinion in delaying to file suit.