Title company never told us about ROW's found during their search. Can we sue after we have closed o

[Rachel R.]

Jurisdiction

Virginia

We purchased land in Feb 2021. We chose a closing company and they did a title search. They told us that everything looked good and that we could close on the property. (to me that means that nothing was wrong with the property). After we started construction, one of the neighbors informed our contractor there were several major Right of Ways through our property and that wherever we put our driveway, the neighboring lodge and guests can use it. The neighboring lodge provided us with the plat of their property which showed the ROW onto our property. I confronted the title company about the newly discovered information and demanded that they send me the title search results. (They were NOT provided to us before or at closing.) The title company said that they couldnt locate our plat at the court house. (Which was a lie because my husband went and found it once we realized we were having issues with the ROW). The title company advised that I get a lawyer and they would no longer answer my questions. The ROW's were noted in their title search paperwork in the exceptions sheet. Can I sue them for not disclosing that information to us prior to closing? We likely would not have purchased this lot or would have negotiated a much lower price. We have cameras on the property and have had a number of people using our driveway.

 

[zddoodah]

We chose a closing company and they did a title search. They told us that everything looked good and that we could close on the property. . . . I confronted the title company about the newly discovered information and demanded that they send me the title search results. (They were not provided to us before or at closing.)

I'm confused about what exactly this title company's role was. Was it solely to act as an escrow company/settlement officer? Or did you purchase a policy of title insurance? You said that someone at the title company "told [you] that everything looked good" but that the title company never provided you any documentation regarding the title search results. Did this just happen in a phone call or something -- in other words, did you simply rely on someone telling you, "everything looks good" without any sort of title policy or any sort of written assurance regarding the status of title?

The title company said that they couldnt locate our plat at the court house. (Which was a lie because my husband went and found it once we realized we were having issues with the ROW).

The fact that your husband was able to locate it doesn't support your allegation of a lie.

Can I sue them for not disclosing that information to us prior to closing?

Anyone can sue anyone for anything. However, it's not clear that this title company owed you any duty of disclosure.

The title company advised that I get a lawyer

That's an excellent suggestion.

 

[Zigner]

The ROW's were noted in their title search paperwork in the exceptions sheet.

That will likely be a problem.

 

[Redemptionman]

That will likely be a problem.

Yes, and did you not read the exceptions sheet?

 

[Rachel R.]

I'm confused about what exactly this title company's role was. Was it solely to act as an escrow company/settlement officer? Or did you purchase a policy of title insurance? You said that someone at the title company "told [you] that everything looked good" but that the title company never provided you any documentation regarding the title search results. Did this just happen in a phone call or something -- in other words, did you simply rely on someone telling you, "everything looks good" without any sort of title policy or any sort of written assurance regarding the status of title?

We paid them for a title search and they were also our settlement company. I did not purchase a policy of title insurance from them. We were told over the phone that everything looked good with the title search and that we could continue with the closing. They did not provide the title search documentation results at or before the closing. They were only provided after the closing and I had to demand them because they did not want to send them.

I assumed the title search results would be in our closing paperwork but with so much paperwork to go over and sign, i didnt think about asking for it at the time. I have learned my lesson the hard way not to trust people without asking for documentation.

Thank you for your time in responding.

 

[Rachel R.]

Yes, and did you not read the exceptions sheet?

I read the exceptions. It was not sent to us until 4+ weeks after the closing.

 

[Redemptionman]

I read the exceptions. It was not sent to us until 4+ weeks after the closing.

You need a real estate transaction lawyer familiar with the law in your state. Virginia has some strange laws relating to ROW issues and have not ever seen a ROW deeded to another property owner. In any case if you are too far into the construction then build it then sell it. Someone who doesn't care about the easement would buy it.

 

[zddoodah]

We paid them for a title search. . . . I did not purchase a policy of title insurance from them. We were told over the phone that everything looked good with the title search and that we could continue with the closing. They did not provide the title search documentation results at or before the closing.

I don't know...maybe that's just how things are done in Virginia, but I have never heard of paying a title company to do a title search and not receiving something in writing. The buyer typically receives a written preliminary title report that lists everything of record and lists out various exclusions and exceptions. Nor can I even conceive of closing on a real property transaction based solely on a verbal representation that "everything looked good."

I suggest taking whatever documentation you do have to a local real estate attorney for review and advice.

 

[welkin]

and have not ever seen a ROW deeded to another property owner.

Then who do you think the easement is granted to if not another property (the dominant estate)?

Here are 59 cases that have already been adjudicated by the Virginia courts that prove you are incorrect.

An easement (ROW) is between the servient and dominant estates.

 

[Redemptionman]

Then who do you think the easement is granted to if not another property (the dominant estate)?

Here are 59 cases that have already been adjudicated by the Virginia courts that prove you are incorrect.

An easement (ROW) is between the servient and dominant estates.

Usually an access road is joined in ownership 50/50 which if that is the case then the land owner needs to understand that. If that is what they are saying great, it was my understanding that this ROW cuts through the other land owners property which case I have not heard of this.

 

[flyingron]

Usually, the bank insists on the search (and its results) and requires a title insurance policy to protect their interest. Frankly, the search is pointless without the insurance to back it up. I wouldn't even take a gift of property from my sainted aunt without owner's title insurance. I've also not seen a lender issue a loan without a plat either.

Still, I find the title insurer's behavior a bit dubious if it actually happened the way you said it did.

 

[welkin]

Usually an access road is joined in ownership 50/50 which if that is the case then the land owner needs to understand that.

That would depend on how the road was created. If the land that the road lies on is a separate plot and not belonging to any other owner of adjacent land, then it may be true.

However, that is not true of an easement. Our easement law has evolved from English Common law and dates back more than 3,000 years to the time of kings and sovereigns. So the doctrines and laws are well established.

An easement is a non-possessory interest in the use of property you do not own. The property that is encumbered by the servitude is the servient estate and the property that the easement serves is the dominant estate. There is no ownership of the land by the dominant estate. There is only the use for which the easement was granted.

In this case (of OP) there is an easement across his/her property for the benefit of another property (the lodge). That makes OP's property the servient estate and the lodge property the dominant estate.

Once an easement that is appurtenant is granted it will exist in perpetuity (with some exceptions) determined by the courts.

We purchased land in Feb 2021. We chose a closing company and they did a title search. They told us that everything looked good and that we could close on the property

What the title search may have reveled is that there was no cloud over the title. But it may not have flagged the fact that you wanted to know if there were an encumbrances or a servitude on the property unless you asked that question. You apparently did not ask.