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ESTHER JANE HOOPER v. COMMONWEALTH LAND TITLE INSURANCE COMPANY (03/13/81)

filed: March 13, 1981.

ESTHER JANE HOOPER, A/K/A ESTER J. HOOPER, A/K/A MRS. WILLIAM E. HOOPER, APPELLANT,
v.
COMMONWEALTH LAND TITLE INSURANCE COMPANY



No. 1055 October Term, 1979, Appeal from the Order of the Court of Common Pleas of Delaware County, at No. 77-6974, Civil Action, Law.

COUNSEL

Harry R. Mayer, Drexel Hill, for appellant.

Kenneth T. Ulrich, Philadelphia, for appellee.

Spaeth, Brosky and Van der Voort, JJ.

Author: Van Der Voort

[ 285 Pa. Super. Page 267]

Appellant was the seller of a certain tract of real estate. Appellee issued a policy of title insurance to the third party buyer of appellant's tract. In conducting a title search appellee discovered a judgment of record against the seller in the amount of $37,155.09. At the time of closing, May 30, 1974, appellee withheld $37,155.09 from the vendor's proceeds from the sale. This amount was forwarded to the judgment creditor on the same day of settlement. The creditor failed to enter satisfaction of the judgment until March 10, 1977. On January 26, 1977, appellant applied for a loan but was denied the same because of the previously mentioned judgment. Appellant filed a Complaint in Trespass and/or Assumpsit on May 31, 1977, against the title insurance company. It was alleged that appellee failed to satisfy the judgment thereby causing appellant's credit standing to suffer.

Appellee, title insurance company filed preliminary objections in the nature of: a demurrer; non-joinder of a necessary party; a motion to strike; and failure to exercise a statutory remedy. The court sustained the objections in the nature of a demurrer and non-joinder of a necessary party. Leave was granted to appellant to file an amended complaint. The amended complaint followed the form of the original complaint with an added allegation that the circumstances gave rise to a promise on the part of the company to remove the judgment. Appellee's preliminary objections contained a demurrer and a claim of non-joinder of a necessary party. The preliminary objections were sustained and the seller was allowed to again amend her complaint. Appellant filed a notice of appeal to this Court of the order dismissing her complaint.

Appellant argues that there are three bases for imposing liability upon the company for the alleged damage to her credit rating:

1) there was a direct contractual relationship between the title company and the seller;

[ 285 Pa. Super. Page 2682]

) the seller was a third party beneficiary of the contract between the title company and the buyer; and

3) the title company's authority to receive the payment created a duty on its part to extinguish the debt.

These three contentions demonstrate only two theories for recovering from the title company; contractual, as a result of the title insurance contract; and assumption of a duty, resulting from the company's role as a conveyancer. The assumption of the duties of a conveyancer are independent of the contract to insure. Henkels v. Philadelphia Title Insurance Co., 177 Pa. ...


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