First American Title Insurance v. Johnson Bank

VICE CHIEF JUSTICE PELANDER,

opinion of the Court:

¶ 1 This case presents the question of how to calculate damages under a lender’s title insurance policy that failed to disclose encumbrances substantially affecting the value of the property and thwarting its intended use. Because the policy itself does not specify a valuation date, we are asked to determine the appropriate date from which to measure the insured lender’s loss. We hold that when an undisclosed title defect prevents the known, intended use of the property and causes the borrower to default on the loan, the lender’s…