Showing posts from December 16, 2007

Condominium unit title insurance (page5)

Examples of these documents include a declaration, by-laws, plats and maps. See JOYCE PALOMAR, TITLE INSURANCE LAW, 9.07 (1997). ' See ALTA Endorsement 4 (Condominium), Appendix A, infra p. 194. The ALTA Condominium Endorsement Form 4 was adopted in New York on September 1, 1993. 8 See ALTA Endorsement 4.1 (Condominium), Appendix B, infra p. 196. Form 4 and Form 4.1 are identical with two exceptions. In those states where the association lien for common charges has been granted a super-priority status, Form 4.1 is used and assures only that the insured interest has priority and that no amount is due or lien is in existence for condominium association charges at the date of the policy. ALTA Endorsement 4, supra note 7; ALTA Endorsement 4.1, supra note 8. See, e.g., ALA. CODE 35-8A-401 to -417 (1991); N.C. GEN. STAT. 47C-4101 to -113 (1996). For example, the condominium acts in Alabama and North Carolina each have sections that require offering statements to provide specific informa…

Condominium unit title insurance (page4)

The ALTA Condominium Endorsement Form 4.1 of October 17, 1992 goes even further than insuring priority by substituting a new paragraph four in place of the paragraph four in the ALTA Condominium Endorsement Form 4 as follows: "Any charges or assessments provided for in the condominium statutes and condominium documents due and unpaid at Date of Policy."27 This Form 4.1 language insures that there are no unrecorded common expense liens unpaid as of the date of policy. Without this language an inchoate unpaid lien that existed at the date of the policy, but not filed or recorded until later, would not be covered by the policy as a post-policy lien. Under a statute such as New York Real Property Law section 339-aa, the common charges lien is effective only from and after the filing of a verified notice of the lien in the recording office in which the declaration is filed. Furthermore, the notice of lien must conform to the various requirements set forth in the statute.28 Paragr…

Condominium unit title insurance (page3)

It should be noted that the insurance only deals with "present violations" as of the date of the policy. It is difficult to imagine how the violation of a restrictive covenant by the seller might result in loss or damage to the new purchaser or mortgagee. Paragraph four in ALTA Condominium Endorsement Form 4, although seemingly applicable to loan policy coverage only, can actually be used for either form of policy. Paragraph four insures against loss or damage sustained by reason of: The priority of any lien for charges and assessments provided for in the condominium statutes and condominium documents over the lien of any insured first mortgage identified in Schedule A.22 The mortgage lien priority insured only deals with charges and assessments that were given priority by the applicable condominium statute. This usually involves the lien in favor of the condominium association for common expenses and charges. Underwriting requires an examination and understanding of the app…

Condominium unit title insurance (page2)

While paragraph one of the Condominium Endorsement deals with the unit not being part of a statutory condominium, paragraph two deals with the adverse effect on title to the unit if some of the required statutory documents do not comply with all of the statutory requirements. Usually, the basic statutory condominium documents are the declaration, by-laws, and plans. Many of the condominium statutes require that the declaration or other documents either contain certain provisions or conform to standards set forth in the statute. For instance, UCA section 2-105 sets forth fourteen necessary contents of the declaration of a condominium.13 With respect to "Flexible Condominiums" and "Leasehold Condominiums,"14 both of which are impermissible in many states,15 there are additional statutory requirements in sections 2-106 and 2-107. In the states that have adopted the UCIOA, its section 2-105 also contains fourteen requirements.16 Similarly, there frequently are other re…

Condominium unit title insurance

A condominium unit is real property and, as such, is insurable under all current forms of title insurance policies, including the almost nationally accepted forms of the American Land Title Association ("ALTA"). As such, the owner's policy insures against loss sustained by the insured by reason of the following four coverages: 1. Title to the estate or interest described in Schedule A being vested other than as stated therein; 2. Any defect in, or lien or encumbrance on, the title; 3. Unmarketability of the title; 4. Lack of a right of access to and from the land.l The ALTA loan policy2 furnishes all four coverages to a condominium unit mortgagee plus four additional coverages:
5. The invalidity or unenforceability of the lien of the insured mortgage upon the title; 6. The priority of any lien or encumbrance over the lien of the insured mortgage; 7. Lack of priority of the lien of the insured mortgage over any statutory lien for services, labor or material: (a) arising fr…

Chicago Title Insurance Company

Chicago Title Insurance Company has appointed James G. Hyland to the position of assistant vice president and counsel to its Mineola office. Hyland was formerly chief underwriting counsel to Stewart Title Insurance Company in New York City.
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