THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.
Bulletin: CA000012
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Bulletin: CA000012
Dear Associates:
Recently this office suffered a substantial tax loss on taxes affecting a fee ownership. Our binder had been written to insure a leasehold interest. In the process of the search and examination we did not consider the taxes on the underlying fee.
One week prior to the Tax Collector's tax sale for the property in question a claim was made on Stewart Title to protect the insured from loss of their interest if the tax sale was held.
Note: Taxes on a fee interest are superior to any lease or sublease created on the same property. As such, a tax sale for fee taxes would terminate any junior lease or sublease.
In the future, whenever we are insuring a leasehold interest or subleasehold interest, we must verify taxes on the underlying fee estate to make sure that they are current and except them from coverage if delinquent, by showing the delinquent fee taxes as an item in our preliminary reports and policies if not paid.
References
- Bulletins Replaced:
- None
- Related Bulletins:
- None
- Underwriting Manual:
- Exceptions Manual:
- None
- Forms:
- None