Silberger v. Smith

NASSAU COUNTY
Insurance Law

New York Law Journal

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Justice Arthur Diamond

Old Republic Title Insurance (ORTI) moved to dismiss the complaint against it. Silberger commenced an action against ORTI, among others, alleging damages as the real property he purchased was a legal one family dwelling, not a legal two family dwelling. He claimed the variance allowing use and occupancy of the premises as a two family dwelling expired without his knowledge before the closing. ORTI, a title insurance underwriter, was named in the action as Junction Abstract, its issuing agent, issued an owner's policy of title insurance to Silberger. The court noted a policy of title insurance was a contract of indemnification regarding the marketability of title indemnifying the insured against loss or damage resulting from title being rendered unmarketable by a defect, lien or encumbrance. The court noted a zoning ordinance, existing at the time of the contract regulating only the use of the property, generally was not an encumbrance making title unmarketable. It ruled the violation Silberger complained of related to the manner the property could be used, not its marketability, thus not a defect impairing title, and was specifically excluded from coverage. As ORTI made a showing of documentary evidence that all factual issues were resolved, its motion was granted.

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