Bulletin: OK2007001

Dear Associates:

The Oklahoma Legislature has amended the requirements for issuing title insurance in Oklahoma. House Bill 3009, signed into law on June 7, 2006, amends Title 36 O.S. 2001, Section 5001 (C) of the Oklahoma Statutes. The new law, which will become effective July 1, 2007, provides an alternative to the requirement for examination of a duly certified abstract of title, as defined in the Oklahoma Abstractors Law, prior to the issuance of a policy of title insurance.

Effective July 1, 2007, for the purpose of issuing title insurance in Oklahoma, a duly certified abstract extension or supplemental abstract may be prepared by an abstractor licensed in the county where the property is located, and starting from the effective date of a prior owner’s policy of title insurance, issued by a title insurer licensed in Oklahoma. The "supplemental abstract" must be examined by an attorney licensed to practice in the State of Oklahoma. The amended statute requires that the "prior owner’s policy of title insurance" must be provided by the insured at the time a "valid order", pursuant to the provisions of the Oklahoma Abstractors Law, is placed.

The "new statute" continues the requirement under Title 36 O.S. 2001, Section 5001 (C), that "every policy of title insurance . . . .issued by any company authorized to do business in this state shall be countersigned by some person, partnership, corporation or agency actively engaged in the abstract of title business in Oklahoma, as defined and provided in the Oklahoma Abstractors Law or by an attorney licensed to practice in the State of Oklahoma, duly appointed as agent of a title insurance company . . . ."

We believe that it will be necessary for the examining attorney to base his/her examination of title on both the '“prior owner’s policy" and the "supplemental abstract". Therefore, the examining attorney must be provided a copy of the "prior owner’s policy" to examine in conjunction with the "supplemental abstract". We expect that the examining attorney's opinion will be limited to the title evidence presented for examination.

In the event that you will be utilizing this new procedure, we require (1) that the "prior owner’s policy" provided by the insured be complete, including the policy jacket; (2) that the search and examination of title begin no later that one year prior to the effective date of the "prior owners policy", in order to determine that nothing adverse has been filed in the "gap"; (3) that the "start" or "from" date of the "supplemental abstract", authorized by HB 3009, will be a minimum of one year prior to the effective date of the "prior owners policy", and (4) that the "vesting deed" must be shown in the "supplemental abstract". In the event that the "vesting deed" was filed for record prior to the "one year period", the "start" or "from" date of the "supplemental abstract" will be the date and time of recording of the "vesting deed".

STEWART TITLE GUARANTY COMPANY POLICIES:

You may utilize a "prior owners policy", with specific Schedule B exceptions, issued by Stewart Title Guaranty Company, as the basis for issuance of a subsequent policy of title insurance, pursuant to HB 3009.

OTHER UNDERWRITERS POLICIES:

You may utilize a "prior owners policy", with specific Schedule B exceptions, issued by a well regarded national or regional underwriter, as the basis for the issuance of a subsequent policy of title insurance, pursuant to HB 3009.

COPY OF THE NEW LAW:

See Exhibit "A" Title 36 O.S. § 5001 (C)

Please contact a Stewart Oklahoma underwriter if you have any questions concerning this or any other topic for which you need assistance.