On March 21, 2023, the Connecticut Appeals Court ("the Court") issued its opinion in the matter of Stewart v. Old Republic Nat'l Title Ins. Co., 291 A.3d 1051 (Conn. App. Ct. 2023), affirming the grant of summary judgment to Defendant Old Republic National Title Insurance Company ("Old Republic") and the dismissal of Plaintiffs Jeffrey Stewart, Andrea Stewart ("the Stewarts"), and 9 Byram Dock, LLC's ("the LLC" and together with the Stewarts "Plaintiffs") claims that Old Republic was required to afford them a defense under title insurance policies they had purchased.
Background
The Easement Dispute
In 2013 and 2014, Plaintiffs purchased two neighboring real properties located on Byram Dock Street in Greenwich Connecticut ("the Properties"), with Old Republic issuing title insurance policies in connection with these transactions. In 2016, neighbors to the Properties brought suit against the LLC, alleging it had obstructed an easement allowing for the private use of a portion of the street by extending its lawn, installing a raised drainage system, and removing a pillar that marked the private and public portions of the street. The LLC initially retained counsel to defend this suit without informing Old Republic, before later filing a Notice of Claim advising of the pending action and seeking defense and indemnification. Old Republic subsequently denied the LLC's claim on the basis that the title policy insured only the LLC's right to ownership and good title, which was not in dispute and which the easement-related allegations could not implicate.
The Cemetery Dispute
In a separate 2016 incident, the Town of Greenwich Conservation Commission ("the Commission") recommended that the Town of Greenwich ("the Town") acquire an abandoned cemetery that a portion of the Stewarts' driveway was believed to pass over, advising the Town that it was entitled to do so by General Statute § 19a-308a which vested municipalities with authority to "acquire an abandoned cemetery, including ownership of any occupied or unoccupied lots or grave sites in such cemetery." The Town proceeded with this plan and published a public notice advising of its proposed acquisition. In response, the Stewarts sued the town – again without notifying Old Republic – seeking a declaratory judgment to quiet title regarding the portion of their driveway. Ultimately, it was agreed that the Town would acquire the cemetery and then quitclaim the driveway back to the Stewarts. Subsequently, the Stewarts filed a claim with Old Republic seeking to recover the fees they had expended in this litigation, with Old Republic disclaiming coverage because it had never approved the Stewarts' suit or fees, and also because the Stewarts' title policy expressly excluded actions resulting from exercises of governmental police power or condemnation.
The Appeal
Following the above denials, Plaintiffs brought suit against Old Republic alleging that each denial constituted a breach of Old Republic's title policies. Old Republic ultimately obtained the dismissal of these claims via summary judgment, which Plaintiffs then appealed before the Court.
On appeal, the Court affirmed the grant of summary judgment. Beginning with the easement dispute, the Court held that the neighbors' easement claims had no potential bearing on the validity of the LLC's title, as their complaint contained no allegation that they or anyone else possessed an adverse ownership interest in the land underlying the easement. Simply put, since the complaint did not include allegations potentially impacting title or ownership, the grant of summary judgment was warranted.
As to the cemetery dispute, the Court held that the Town's acquisition of the cemetery never constituted an attempt to impact the Stewarts' title to the property, as the ultimate determination of whether there was a cemetery on the property merely constituted a condition of the property, and not a matter of title. Additionally, the Court held that the Town's acquisition of property under General Statute § 19a-308a constituted both an exercise of governmental police power and an acquisition via condemnation, and thus, the title policy's exclusions for these manner of actions operated to relieve Old Republic of any duty to defend.
Takeaways
This opinion demonstrates that a title policy does not, absent express language to the contrary, protect an insured against allegations that the insured's use of its land infringes on other parties' easement rights. It also illustrates that an insured's initiation of litigation to determine whether a municipality can acquire a portion of the covered property via either governmental police power or condemnation will not trigger coverage under a standard title insurance policy.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
