Southland Title Corp. v. Superior Court

Petitioners Southland Title Corporation, Land Title Insurance Company and Lawyers Title Insurance Corporation (Southland) seek a writ of mandate compelling the Los Angeles Superior Court to vacate an order which overruled Southland’s demurrer to a cause of action for negligence and to enter a new and different order sustaining that demurrer. It was alleged that Southland had negligently prepared a preliminary report of title upon which a prospective buyer of residential real property had relied in deciding to purchase. The report failed to reflect a recorded flood control easement which affected the property.

We hold that while the law was otherwise prior to January 1, 1982, amendments to the Insurance Code, effective upon that date, prevent the assertion of a claim of negligence against the issuer of a preliminary report of title. The trial court should have sustained Southland’s demurrer. We will therefore direct the issuance of a peremptory writ.

Procedural and Factual Background

In June of 1990, the real parties in interest, Joel W. Nye and Patricia A. Nye (the Nyes), filed an action for damages against Southland. They sought recovery in both contract and tort. For…