Plaza Home Mortgage, Inc. v. North American Title Co., Inc.

Plaza Home Mortgage, Inc. (Plaza), appeals the motion of judgment granted by the trial court after it found (1) North American Title Company, Inc. (North American), did not breach the closing instructions contract between Plaza, a wholesale lender, and North American, the settlement agent; and (2) even if North American did breach that contract, there was no showing by Plaza that North American proximately caused Plaza’s damages.

Plaza sued North American after North American distributed $53,853 to the attorney in fact of the buyer of real property—a payment Plaza refers to as a “kickback”—that was neither authorized by the closing instructions nor disclosed by North American before it made the payment. North American made the $53,853 payment after escrow closed, based on a last-minute escrow instruction it received from the owner of the property at or near the time of the closing of escrow.

As we explain, we conclude the court erred both when it found there was no breach of the closing instructions contract with Plaza because escrow had closed and when it failed to consider whether North American breached the closing instructions contract when it disbursed the $53,853…