Appeal from the Order of Superior Court at Nos. 535 and 665 Philadelphia, 1986, dated March 24, 1987, affirming the Order of the Court of Common Pleas of Montgomery County at No. 83-02305 dated October 22, 1985, granting judgment in favor of appellee, and against appellant. 365 Pa. Super. 651; 526 A.2d 819 (1987). Sur Appellant's Petition for Reconsideration of her Petition for Allowance of Appeal granted by Order of the Supreme Court on November 7, 1988, said Petition for Allowance of Appeal being from an Order of the Superior Court of Pennsylvania at No. 535 and 665 Philadelphia, 1986, dated March 24, 1987, affirming the Order of the Court of Common Pleas of Montgomery County at No. 83-02305, dated October 22, 1985, granting judgment in favor of appellant, and against additional appellee. 365 Pa. Super. 651; 526 A.2d 819 (1987).
Jeffrey S. Estabrook, Philadelphia, for appellants.
Lawrence A. Ruth, Conshohocken, for appellee Hicks.
Nix, C.j., and Larsen, Flaherty, McDermott, Zappala, Papadakos and Stout, JJ. Larsen, J., concurs in the result. Zappala, J., files a concurring and dissenting opinion in which McDermott, J., joins.
This appeal presents two questions: whether a land title insurance company can be liable directly to a widow whose late husband sold their entireties property by forging her signature on a deed, even though the widow was not insured by the title company; and whether the chancellor erred in holding that the widow's claims for rescission of the deed and reconveyance of the land were barred by laches so that she could not recover from the purchasers of the property. We hold that the land title company's liability is limited to indemnification of its insured and that direct liability to an uninsured third party is precluded. We also hold that the doctrine of laches does not bar the widow's recovery of the real estate, as her three and a half year delay in filing suit was not prejudicial to the rights of the purchasers.
The plaintiff-appellee, Nancy Krupa Hicks, formerly Nancy Krupa, entered into a valid common law marriage with Nicholas Krupa in 1940. Two children, George and Shirley Krupa, were born of the marriage. Together, in 1955, Nancy and Nicholas Krupa purchased a residence in Montgomery County, Pennsylvania, taking title as tenants by the entireties. The Krupas separated in 1959; Nicholas remained in the marital domicile with his son George, and Nancy moved to a new residence with her daughter Shirley. Following the separation, Nancy contributed to the household
expenses of her husband and son who remained in the marital domicile.
In 1961, Nicholas forged Nancy's signature on a deed which conveyed the residence from Nicholas and Nancy Krupa to Nicholas Krupa as sole owner. On April 25, 1977, Nicholas Krupa unilaterally sold the property to Joseph and Rita Saboe. Nancy Krupa learned of the forgery on September 6, 1979, as well as the sale to the Saboes. She took no action, however, until 1983.
In the meantime, Nicholas Krupa died in January, 1982. On February 13, 1983, Nancy Krupa Hicks sued the Saboes in equity seeking rescission of the 1977 sale from Nicholas Krupa to the Saboes and reconveyance of the real estate to her. The Saboes joined two additional defendants: the witness to the forged 1961 deed and the notary on the deed. On October 7, 1983, the notary joined appellant, Industrial Valley Title Insurance Company (IVT), as an additional defendant, alleging that IVT negligently cleared the title at the time of the 1977 sale from Nicholas Krupa to the Saboes.
Following trial before the equity chancellor, judgment was entered in favor of the Saboes due to Nancy Krupa Hicks' delay in bringing suit against them, and judgment in the amount of $24,000 was entered for Mrs. Hicks against IVT due to its negligence in clearing its objections to Nicholas Krupa's title as grantor of the real estate in 1977. Claims against the remaining parties were dismissed or waived. Both Mrs. Hicks and IVT appealed from the chancellor's judgments, and a divided panel of the Superior Court affirmed the trial court 365 Pa. Super. 651, 526 A.2d 819. Both parties have appealed from Superior Court.
IVT challenges the award of money damages in favor of Mrs. Hicks, who was not a party to the title insurance contract between IVT and the Saboes, who purchased the property in 1977. It is clear ...