Chicago Title Insurance v. Allfirst Bank

In this case we must decide an issue of first impression, whether a depositary bank is liable in negligence to a non-customer drawer of a check. The parties and their respective roles, in this declaratory judgment action, are complex and will be detailed infra. For now, we note that the instant case originated with the refinancing of Mark A. Shannahan’s home in 1997. Petitioner, First Equity, an agent for petitioner, Chicago Title Insurance Company, conducted Shannahan’s settlement. 1 Shannahan granted an indemnity deed of trust (“IDOT”) to Farmers Bank of Maryland, where he also maintained…