I did sign the Settlement Agreement

Well I did throw in the towel and give up the fight and I signed the Settlement Agreement.  The fight was very costly not just in money but time and energy and I realized that one person cannot fight a huge corporation who I believe rather than pay claims uses the money from their client's policy payments to fight lawsuits.  And their resources compared to mine are limitless.

As soon as I get the document signed back from them I will be in a much better place to comment about the situation at large.

Fidelity National Title's Manager West Region

In July 2010 the Manager West Region honored by Reconsideration Request and the Fifth assigned Claims Counsel on July 22, 2010 considered the matter concluded and closed.  But four days later the Manager West Region emailed "If you would like to provide us with an appraisal from a certified appraiser we would be more than willing to review it."

I spoke to different advisers who felt that this matter was still then open but that the actions of Fidelity National Title warranted other actions as the loss at this point was more than just the loss of actual easement but also the loss of the ability to market the property.

And one of the things also that had made an impression on me by this time was that the job of the Claims Counsel was not to help me as the insured but rather to represent the bottom line and profitability of the company itself. 

The Second Appraisal from the same Appraiser from Boise Idaho

I requested that a different appraiser be retained to do the next appraisal and also the data I provided be included in the analysis.

The Fourth Claims Counsel from Fidelity wrote:

Needless to say on November 19, 2009 the Fourth Claims Counsel sent an almost identical appraisal which did not address that "extensive sales data" I had sent and it now indicated not surprisingly after reading the Brief cited before - the value of the loss was not zero.

And also not surprisingly I did respond and it could be easily interpreted that I did "complain" which prompted the following response from the Fourth Claims Counsel:

The Fourth Claims Counsel with Fidelity National Title Expresses His Intentions

I could not get the Third Claims Counsel to respond to me so I finally wrote to the California Department of Insurance for help and assistance.

On August 18, 2009 I heard from the Fourth Claims Counsel that he was replacing the Third Claims Counsel.  We had a phone conversation and I explained what had happened and how I felt that valuing an existing prescriptive easement to a road in a different county was inappropriate.  And as naive as I was - I thought he actually understood and agreed with me.

Then a couple of weeks ago I read this - and I realized what a fool I had been to actually trust the Fourth Claims Counsel to actually have my best interests at heart.

Needless to say when I read the above brief I was - well - it is difficult to describe exactly how I felt.

But here is what I understand from the above:

1. First, when the appraiser originally advised the Third Claims Counsel "If the estimated Cost to Cure is less than the difference of the "Before and After Value", the Cost to Cure is considered to be the appropriate measure of damages."  To me this means that at the time of the first appraisal, the appraiser determined that the "Before and After Value" was greater.
2. The reason it was decided to do a second appraisal was because of my complaint to the Department of Insurance and not because a replacement value for an easement in Napa Valley could be to a different road in a different county.
3. Even though one would think because of #1 is logical the Fourth Claims Counsel already feels that the second appraisal "will likely be lower."
4. It is already felt that I might "complain".
5. And finally, even though the property was foreclosed on because it was not marketable without the lost easement - they will then raise the foreclosure as an issue.

And one of the really interesting things is that the Fourth Claims Counsel never mentions to me or in any of the communication which I read that he understood that the lost easement was actually valid.  As a matter of fact the second appraisal is done as if it were still lost.  Very confusing.

A Very Confusing Letter From Fidelity National Title's Third Claims Counsel

On July 10, 2009 I received this letter:

So until year's later I understood this letter I interpreted this letter to say that although the Parcels were excepted in Schedule B they were still treating this as a covered loss and they were using the value determined in the DIV appraisal prepared by the appraiser from Boise Idaho.  I CERTAINLY DID NOT GET THAT THE EASEMENTS WERE VALID.  And my attorney did not understand this letter as saying that the easements were valid.  Only after reading the internal communication three years later did I get that the easements ran with the land.  What a shock !!!!!  

In fact I disagreed with the statement that the Parcels 2 through 5 were excepted from coverage by Schedule  B.  Per Part One of Schedule B, number 3 states that "easements, liens or encumbrances, or claims thereof which are not shown by the public records" are excepted from coverage.  And I was provided the recorded documents by the title officer in Napa prior to the original purchase.

The Easement is Valid - But Fidelity National Title Never Told Me

So as I delved into the documents that Fidelity provided - the most shocking thing which I discovered was that because of the Third Claims Counsel's inquiry - it was determined a year after it was lost - that the easement might actually be valid.

In the Policy Payment Approval Report dated June 26, 2009:

And then by the time the property has proven to be unmarketable without the easement:

So according to this - even though the loss of the easement for almost a year had affected the marketability of the property tremendously, the Third Claims Counsel appears to be preparing a defense that there was actually no loss and the property is as insured.

And on June 30, 2009 from a Fidelity employee to the Third Claims Counsel:

At this same time as we had dropped the price of the property dramatically without getting even the slightest offer, I allowed the property to be foreclosed on.

Fidelity National Title Accepts the Appraisal from PGP Valuation of Boise Idaho

By this time my agent and I had dropped the sale price on the property more than seven times, decreasing the sale price more than $750,000.  The loss of the private entrance through residential property leaving only a legal entrance through a commercial winery, which included the manufacturing facility and tasting room, was the single largest deterrent in the sale of the property.  Traffic and noise from the vineyard operation, commercial manufacturing of the wine, and the constant flow of tourists to the tasting room and for special events were major objections of all potential buyers.

May 1, 2009 the appraiser from Boise Idaho completes his appraisal determining that perfecting the prescriptive easement to Cavedale Road in Sonoma County can be substituted for perfecting the easement to Mount Veeder Road in Napa County and valued the "Cost to Cure" at $13,500.

I wrote a response of almost 30 pages correcting errors and misinformation in the appraisal and providing additional documentation and comparable properties demonstrating that the loss was in excess of the insurance policy amount of $650,000.

On June 15, 2009 the Third Claims Counsel from to the Sonoma County Manager of Fidelity National Title Company and another Fidelity employee, "I'll call Ann and advise her that I'm waiting for Mr. Gibson to provide a written response to his review of the information Ann submitted in an attempt to increase the loss amount indicated in his original DIV report.  I really need to discuss options 1 & 2 with you because Ann is asking me if we have acted on either of these options."  (Note Option #1 was regaining Parcels 2 -5 and Option #2 was obtaining another residential  easement from Mount Veeder Road.)

This email prompted the first investigation (a year after the problem arose) of the validity of the easement described as Parcels 2, 3, 4 and 5.

In the meantime the appraiser from Boise Idaho did respond to my response to his appraisal with what I felt was even more false and misleading data.

Third Claims Counsel in Omaha Nebraska- Now It is Getting Interesting

When I reached the Third Claims Counsel in Omaha Nebraska he said that he was swamped from the closing of the Chicago Office but he did ask for the names of local appraisers which I provided him with.

I was then told that an appraiser was chosen from Fidelity's list of "approved" appraisers.  Here is an email to the supervisor of the Third Claims Counsel from Boise Idaho.  He appears to be well qualified in providing Diminution in Value appraisals for title companies in a variety of states but not necessarily familiar with the Napa Valley.

The appraiser from Boise Idaho appears to be very well versed in producing an appraisal that is the lesser amount which is the "appropriate measure of damages".  My understanding of this is that it is his job as a specialist in DIV appraisals to advise the Claims Counsel in how to come up with an amount that pays the least to the insured as an "appropriate measure of damages."  Or am I reading the following email incorrectly?

And he indicates (but has never listed nor defined) the "commercial" vineyards he has appraised.  Nor does he explain what this has to do with valuing the loss of a residential easement.

The Second Claims Counsel with Fidelity National Title Insurance Company

So I am now with a Claims Counsel in Chicago.  I do not quite understand this - I just receive a letter stating that I have a new office and counsel.  It does not make sense to me to transfer the claim from Walnut Creek, California near the subject property in the Napa Valley to Chicago but.............what do I know?

A document on November 18, 2008 Initial Fact and Claims Analysis states, "However, since these easements were included as insured parcels in Schedule A, we have provided coverage to our insured."

On December 30, 2008, the second Claims Counsel in Chicago wrote, "I have completed my investigation of your claim of loss resulting from a secondary easement insured by the Policy of Insurance as Parcels 2 through 5 of Schedule A but which was, in fact, not owned by the seller and was therefore not properly conveyed to you at the time of your purchase of the property in question.  Consequently coverage is appropriate as defined b the terms and conditions of CTLA Standard Coverage Policy of Title Insurance No. CAFNT0928-949-0003-0006211344-fntic-2004-01-0."

I never heard from Claims Counsel Number 2 again.  He just seemed to fall off the face of the earth.

On January 26, 2009 I finally called the first Claims Counsel in Walnut Creek who told me that the Chicago Office had been closed and that I had been assigned to my third Claims Counsel in Omaha Nebraska.

The First Claims Counsel with Fidelity National Title Insurance Company

First, although I am identifying the Claims Counsel as being with Fidelity National Title Insurance Company - I am not totally certain if this is the correct of the three affiliated companies. I am now aware that there are multiple affiliated companies - the one company I have not been able to identify that one person that I have dealt with works for is Fidelity National Title Insurance Company.

At any rate I spoke was assigned to my first Claims Counsel in Walnut Creek, California on October 29, 2008.  In our conversation it ended with he was going to research on getting the easements back and he wrote to the title officer who had discovered the error, "Since she's trying to sell the property, and needs the claim resolved first, (and we apparently have a long professional history with her) I'm going to be sure to keep this on, or near, the front burner."

Well, I do not think I stayed on his front burner for long as I never heard back from him on the claim.  On November 13, 2008 I was re-assigned to a new Claims Counsel in Chicago, Illinois.

Listing the Property for Sale

In May 2008 I listed the property for sale and contacted all of the adjacent property owners whose properties the easements crossed that I would be crossing their properties.  (I had been working on other properties and had not even been to this property in three years until we started getting it ready to put on the market.)

When I contacted the owner of the first property for the access off Mt. Veeder Road the new owner of the property questioned my right to cross her property.  I sent her the copy of my Prelim with the parcels listed and the descriptions I had received from the Fidelity National Title Company title officer prior to purchasing the property.  She did meet me at the gate from Mt. Veeder and the two of us traversed the easement to the adjacent property.  The road through her property passed her pond and vineyard but the home was not visible from the road.

She told me that it was her understanding that I did not have an easement and she was checking with her attorney and title officer.  I did have the opportunity to show the easement to my real estate agent with the owner's permission but we had to access it from the interior property as the owner never gave me the gate code.  Prior to her title officer confirming that we did not have an easement we had been marketing the property with the two deeded easements from Mt. Veeder Road - this easement through residential property and the other through the commercial/manufacturing property.

After her Title Officer stated that the easement was not valid I immediately contacted my Fidelity National Title escrow officer with the problem.

On October 9, 2008 a Fidelity National Title Company title officer wrote I believe to his boss, "We have asked to issue a pre that Fidelity has insured previously insuring appurtenant easements that do not reach our properties through adjacent properties.  The good new is our property does have access by other means but not by the insured appurtenant easement.  Our insured is now putting the property on the market and wants to advertise that she has and additional access (being the insured easement).  I know we need to forward to the claims department, but escrow wants to know what she should advise her customer.  I think we should be up front and let her know the facts and that it will be handled by the claims department.  Please advise."

The addressee responded, "Your response is the correct one.  You should inform the insured that the matter is being referred to claims counsel and that they will be hearing from claims counsel."

The following Confidential Claim Report to General Counsel was filed:

Meeting with Fidelity National Title Officer in 2002

In 2002 I met with the Title Officer from Fidelity National Title Insurance Company who gave me the parcel map with the easements marked and copies of all of the public records for all of the easements meaning both easements from Mt. Veeder Road in Napa County to the property.

It was apparent to me after this meeting that I needed to deal with the opinion expressed by Fidelity in a previous Preliminary Title Report on the property of the view easement.  But it was also my understanding that there were two easements from Mt. Veeder Road to the property and that there were public records for these easements.

Fidelity National Title Company's First Mistake

In 1998 Hamilton Vose subdivided his property and sold this 80 acre parcel.  At that time the Grant Deed from Napa Land Title Co. lists only Parcel One (the subject property) and Parcel Two (later in the Fidelity Grant Deed described as Parcel Six - the easement through the former Chateau Potelle property).

In 2002 and again in 2004, Fidelity National Title Company added Parcels Two, Three, Four and Five comprising the northern aka lost easement.

According to Fidelity's Website:

"In order to determine the status of title, Fidelity National Title conducts a diligent search of the public records for those documents associated with the property." 

So one of the reasons I was told that the easement was not valid was because it was never the seller's to deed to me.  Reading these two Grant Deeds last week - this actually made sense for the first time.  Not being a title officer preparing a Preliminary Title Report and a Grant Deed on a property for a client, I would think that part of doing a "diligent search of the public records for those documents associated with the property" would include looking at the Grant Deed of the Seller !!!!!!  Guess not.

Describing the Three Easements

As I spent days pouring over the documents from Fidelity National Title Insurance Company trying to find out what had actually happened - I occasionally got a glimmer of what was really going on behind the scenes.  I am over the next few days going to chronicle what happened using the documents they provided and I will let you draw your own conclusions.

But first it is important to illustrate the three easements to the subject property:

This map was prepared by a Fidelity Title Officer for Claims Counsel #3.  I did add the color to make it easier to identify the three easements.

The green easement (which actually continues along the curved property line to Mt. Veeder Road in Napa County) is the only deeded easement at this time.  It comes up through the former Chateau Potelle Winery including the facility for the manufacture of wine and the tasting room making this a commercial/manufacturing entrance to the property.

The pink (dotted) easement to Mt. Veeder Road in Napa County is the northern residential easement and is the easement that apparently should not have been included in the Grant Deed but still indeed may run with the land - I will explain this more later.

The short easement outlined in blue is the prescriptive easement to Cavedale Road in Sonoma County.  This is the easement that PGP Valuation from Boise Idaho valued at $3500 to obtain as a substitute for the residential (pink) easement for the "Cost to Cure" valuation.  His methodology was a square foot calculation (length X width) and then using that figure to his estimation of value per acre.  Needless to say I felt this was not comparable as this easement a) I already had and was using, b) it is obviously much shorter, and c) it leads to a different road in a different county than the lost easement.

"Public insurance companies are the only companies that improve their business by not providing a service to their customers."

"Public insurance companies are the only companies that improve their business by not providing a service to their customers."

I forgot to include this quote in the previous blog entry with the article by Luke Landes.  I really like this quote a lot !!!!!!

He then makes this comparison:

"While everyone jokes about cable companies, they provide customer service by making sure you’re getting hundreds of channels all the time. They may not show up at your door to fix problems, but there are hardly any problems. If a cable company categorically refused to deliver service despite charging its customers every month, it would go out of business; yet, this is exactly how public insurance companies must operate in order to succeed."

He also explains the difference between a mutually held insurance company as opposed to a public insurance company - I after I finish this blog - the next item on my list is to begin researching all of the insurance companies that I use (primarily auto and health insurance) and find companies that do not have shareholders but are mutually held.

I just read a great article on the internet !!!!

Insurance Companies Work for Shareholders, Not Customers

This article was written by Luke Landes 

Please read the entire article as I believe he makes some excellent points like: 

"The entire concept of insurance, particularly public insurance companies with shareholders, is backward. If a company is to survive year after year, it has to make money for its owners. In the case of public companies, executives answer to the board of directors and the shareholders." 

"Here is how insurance companies make money, reduced to the absolute basics:

• Collect as much as possible from insured policyholders in the form of premiums.
• Pay out as few claims as possible (but enough to avoid regulatory scrutiny) to policyholders.
• Profit." 

"When you battle with a publicly-traded insurance company that doesn't want to pay your claim, it is trying to earn another fraction of a cent per share. You just want the company to honor your insurance agreement in exchange for the premiums you have been paying."

This is exactly what I believe happened in my case with Fidelity National Title Insurance Company.  I just wanted them to pay me for my loss that they confirmed was a valid claim - but then in order to protect the value of their shares for their shareholders - they valued the loss at $0.

The Cloud on the Title Made My Property Unmarketable

One of the huge questions in this case was the actual value of the lost easement.  Obviously Fidelity National Title with the assistance of their appraiser from PGP Valuation in Boise Idaho valued this loss at $0.

I, on the other hand, felt that my loss was approximately $800,000 and I felt passionately about this.  And then I also felt that Fidelity had wasted thousands of hours of my time plus the legal fees and expenses in just beginning the lawsuit and then throw my attorney's compensation which was well deserved.

After having spent a full two days pouring over the thousands of pages Fidelity National Title had sent looking for examples of their having acted in Bad Faith - more on that later today - I was driving to the Settlement Conference in Walnut Creek.  Somewhere on I-680 the lightbulb went off on why I felt so strongly about this.

It was not a mile long strip of dirt that I lost - what I lost was the ability to market and sell my property due to the cloud (error) in the title and Grant Deed prepared and insured by Fidelity National Title.  I listed the property in May 2008 and we marketed it first with three easements and then with two easements with a disputed third until October 2008 and finally even in a letter in January 2009 my agent wrote that we still had one potential buyer waiting for resolution (and Claims Counsel #1 was going to pursue obtaining the easement again.)

In the meantime we were dropping the price of the property like a lead balloon in response to this cloud on the title that was proving to make the property unmarketable.  By the time the title officer from Fidelity confirmed the loss of the easement we had already dropped the price by $400,000.

Price reductions were as follows:

6/13/2008                                $1,295,000                              List Price

8/5/2008                                 $1,195,000

8/15/2008                                $  995,000

9/24/2008                               $  945,000

10/13/2008                              $  895,000

10/22/2008                             $  845,000

11/4/2008                                 $  795,000

1/22/2009                                $  770,000

2/19/2009                                $  745,000

4/2/2009                                 $  649,000

5/28/2009                               Withdrawn/Cancelled

The property was foreclosed on in July 28, 2009 when a negotiation for a purchase price of $525,000 failed.

More later........................................

I Would Never Use Fidelity National Title Insurance Company Again

Well I settled with Fidelity for what I felt was pennies.  Their attorney began the settlement conference with a summation of what he felt they did (admitting later that he had not even read their documents) and then spent a huge amount of time "explaining to" (in my opinion threatening) with me all of the horrible things that can happen to me financially if the case went to trial using the example of how much I would owe to Fidelity even if I won and was only awarded a dollar.  It was all legal doctrine that to be honest I do not understand.

If I had it all to do over I never would have bothered with the lawsuit.  I spent thousands and thousands of hours now trying to get Fidelity to pay my claim - basically for nothing.  But over the next few weeks I am going to relate everything that happened yesterday for only one reason - so hopefully no one will ever have to go through what I did.

I did call my escrow officer yesterday after I left Walnut Creek to tell her that I thought she should seriously think of working for a different company.  Her response to the short version of the story was that insurance claims are not part of her job - but then I questioned her - if that is the case how could she sell Fidelity National Title insurance knowing that it may not insure the real estate of the person she is selling it to?  I do not think she is the person I thought she was for all of these years.

The only good thing about this situation is thank goodness that this happened to me and not the hundreds of clients that I referred to Fidelity for title insurance.

So I have to get some work done today but as time permits I will tell the entire story.  But my advise for today -  well I would Never Never Never use Fidelity National Title Insurance Company again.

Meeting Tomorrow with Fidelity National Title Insurance attorneys

So I have spent the last three days reading the 2500 pages that Fidelity sent.  Most of which is just ten copies of everything.  I managed to glean about 10 things of value and the rest was mostly stuff that I wrote in the first place.  No notes.  No research by the Claims Counsels.  No telephone or meeting notes.  A few  things that appear  that they never had the intention of paying the claim and were going to do everything possible to confuse and delay and not respond to my communication.  Reading some of the things I found made me even more disappointed in Fidelity which was a company that I had referred dozens of clients to.

Oh well - tomorrow should be interesting.

Letter to my Fidelity National Title Escrow Officer

December 22, 2009

Dear XXXX,

I know that we have spoken about this very unfortunate situation many times.  Having worked together on literally dozens of escrows both on my own properties and those of my clients, I want to clearly say the future actions I am going to be force to take are no reflection on you or XXX in regards to the excellent escrow services and customer service you have always provided.  Through all of these transactions you were both ultimate professionals and through our association also became friends.

I know that you know that a private entrance to an 80 acre parcel overlooking the Napa Valley does not have a value of zero.  I believe that you really need to consider the ethics in stating that your company represents its clients as an insurance company.  I am including quotes taken directly for your (Fidelity's) website.  Being the honest person that I know you are- I do not see how you can sit across the desk from clients and tell them that your company is going to insure their interests in their property when clearly you now know that the claims department of Fidelity will intentionally delay and then finally not cover the interests in the property that you tell your clients that they have.

I believe that you should look at every single Prelim and tell your clients that in the event there is some errors made by your title department, Fidelity will not take any responsibility whatsoever for those errors and that they are wasting money insuring their title with Fidelity National Title.

I have found this entire situation to be unconscionable.

Ann

Here is a good example of what Fidelity says...............

This was written by Claims Counsel #4 - isn't this disappointing?  It does not give me great confidence that this appraisal was done without bias considering that it is basically been decided before it was done that it would be lower in value and that I would complain about the amount being lower.

And I wonder whose interest Fidelity National Title Insurance Company is protecting ???????????

“XXXX and I decided that due to the DOI complaint, we should go ahead and get the DIV appraisal, which will likely be lower than what Bob already paid Zollinger based on “cost to cure” appraisal.  XXXX suggested if Zollinger complains about lower appraisal, we can then raise the issue of the foreclosure.”

BTW - I did let the bank foreclose on the property as the property proved to be unmarketable without the northern residential easement to Mt. Veeder Road.

So how is the loss of the truly hypothetical easement determined?

So far there are two appraisals that have been done:

·         The appraiser from Boise Idaho who I feel used false and misleading information first valued a ‘cost to cure’ with the easement from Cavedale and then subsequently compared the before and after value using the same  comps as $0.  He does not appear to have even been on the easement nor does it appear that he visited the comparable properties that he used - nor driven on Cavedale Road.

e   "We will take care of this project.  It’s similar to a DIV project I did in Aspen/Snowmass CO last fall.  A key issue for this type of project is not to over look the “Cost to Cure” for the noted defect in title.  If the estimated Cost to Cure is less than the difference of the “Before and After Value”, the Cost to cure is considered to be the appropriate measure of damages, in terms of this project we have valued numerous commercial vineyards within the Napa/Sonoma market over the past few years.”

c    I guess appraising commercial vineyards and properties in Aspen qualified him for this job?  Still have not heard from Fidelity National Title Insurance Company how they found him.

      

      The second appraisal I did myself.  I based it on these principles from Lee vs. Fidelity National Title Insurance Company.

      “[t]he ambiguity should be resolved in favor of the insured.”

“[t]he function of the title company is to ‘give the insured the protection which he reasonably had a right to expect’”

“[t]he risk of a proper description was assumed by the company, and it should bear the responsibility for the mistake.”

·         

       I valued the diminution as the value which we listed the property with all three easements which was determined by comparable properties and we felt was aggressive as the ‘before’ value (as that was clearly what I was led to expect by Fidelity) and compared that to the reality of having only the one deeded easement.  (XXXX just explained to me that unless I am doing the valuation for a lending institution – I can do an appraisal.  Even as an interested party this work should be considered.)

      Needless to say the value that I determined to be the diminution in value was not $0 like the appraiser from Boise Idaho.

From Fidelity - the Parcel Map with the Easement

Parcel Map from Fidelity National Title Insurance of the lost easement

Learning new things about Fidelity all the time

So here is what happened:

• ·         In 1998 XXXXXX subdivided off this property and sold it to XXXXXX.  At that time the Grant Deed from Napa Land Title Co. lists only Parcel One (the property) and Parcel Two (our Parcel Six – the easement thru Chateau Potelle).
• ·         AND HERE IS THE MISTAKE.  When we purchased the property from the XXXX kids after XXX’s death Fidelity added in Parcels Two thru Five.  So although in many documents sent by Fidelity there is a debate as to whether the easements are valid as recorded – THE REASON THEY ARE NOT VALID AS THEY WERE NOT THE SELLER’S TO CONVEY.  Not because they did not reach the property.
• ·         I met with the title officer in Napa prior to purchasing the property and received the map and recorded documents leading me to believe that there was this second deeded easement from Mt. Veeder.  (He apparently had Alzheimer’s and has subsequently died – and there is no record of the original search.)
• ·         When I went to sell the property I (obviously) thought there was a valid easement which is the reason I contacted XXXXXX which started the entire claim.

·         Which then brings us to Lee vs. Fidelity:

“[t]he ambiguity should be resolved in favor of the insured.”

“[t]he function of the title company is to ‘give the insured the protection which he reasonably had a right to expect’”

“[t]he risk of a proper description was assumed by the company, and it should bear the responsibility for the mistake.”

So for the first time I now understand why the easement was not valid - it was never granted to the person I bought the property from but Fidelity included it in my Preliminary Title Report and Grant Deed.

Documents from Fidelity National Title Insurance say.......

Well - there appears to be many missing documents but still over 2000 pages of communication sent from Fidelity National Title.  It is an overwhelming amount of data to sort through but it appears from their claims forms that a lot of it is coming up with a legal "strategy" to not pay my claim.  I am just guessing at this but it seems to be standard in the forms.

The original Title Officer in Napa appears to have suffered from Alzheimer's and passed away and there are no original documents from our meeting other than the documents which I was given.

As I wade through the documents I am just going to post what Fidelity says in the documents so to start here is a quote from Claims Counsel #1 in Walnut Creek to the Title Officer who verified the problem:

"Could you please check to see if an owner's policy was issued? And if so, forward a copy to me? since she's trying to sell the property, and needs the claim resolved first. (and we apparently have a long professional history with her) I'm going to be sure to keep this on, or near, the front burner."

And this seems to be the final communication from him and apparently most of what occurred in Chicago does not exist either.

It truly makes me wonder how I went from the front burner to still fighting this battle more than four years later.

Fidelity National Title - Am I a Victim of Corporate Abuse

Am I a victim of corporate abuse?

I just hung up with my attorney and appraiser - basically second guessing the arguments that Fidelity National Title is going to make to justify their actions and a value of $0.

First, if the value was $0 why did they first do a cost to cure appraisal and determine that perfecting the prescriptive easement to Cavedale Road in Sonoma County could be valued at $3500?

Why did the first claims counsel offer to see about re-gaining the lost easements?

Why was I transferred all over the country?  Why from office to office and claims counsel to claims counsel?

Why did they not produce their documents in a timely fashion?  And why were are the documents requested not produced?

Why would they hire an appraiser from Boise Idaho?

Well we are trying to set up a meeting.  At this point in time the actual value of the loss is almost a moot point but rather how this was handled (or not) is more to the point.  And as my attorney pointed out - a jury might see me as a victim of this huge corporation that has done everything other than deal with the claim professionally.

Is it Time to Give Up and Throw in the Towel?

I am tired.  I have been fighting this battle of trying to get Fidelity National Title to do the right thing and pay the claim that they opened on my behalf for over four years.

And when I was finally forced to hire an attorney and take the battle to court in hopes of getting them to act justly - I now understand that trying to pursue justice is really a matter of who has the most money to throw in the hat. We are now on the third attorney that Fidelity National Title has assigned to this case.

It is so apparent that they have the personnel and the money to make even getting heard a daunting task. They have the claims counsels and appraiser in other states.  Their "expert" witness are crazy expensive just to depose. They produce irrelevant documents and omit the ones asked for as part of the game.  And I think that it is only a game to them.  I am not a valued client - rather just an annoying bug that needs to be squashed.

All I have ever asked is to be treated fairly. Is it time to give up and lick my wounds and realize that one person cannot fight the insurance industry.  I cannot help but ask why I ever bothered to purchase title insurance - obviously it would not have made one bit of difference - as the title insurance from Fidelity National Title did not protect my investment.  Instead Fidelity has chosen to treat me in a way I would never treat a client of mine.

Naming names at Fidelity National Title

BTW I was advised at this point to not name the names of the individuals involved in this unfortunate situation.  But as soon as I can believe me I will so that others can learn from what has happened to me.  (Note on December 6, 2012 - I may not be able to as those individuals could sue me - I may need to be cautious as the legal system does not appear to me to protect the victim.)

And the games go on and on and on

Well although my mother said if you cannot say something nice...........................

But she did not know what it was like to be represented as an insured by a company like Fidelity National Title Insurance Company.  It is getting to the point that I do not understand how the people who work for Fidelity can get up and look themselves in the mirror before going to work.  Or maybe they don't.

From my attorney to Fidelity:

"We had agreed to postpone the disclosure of experts until this Wednesday, but I received the disclosure of Fidelity from XXXXXXXX in the mail. I also finally received the documents by messenger, but there are many documents in this production which relate to foreclosures and properties in other states which are not relevant and some of the documents which are relevant have not been produced and I need all of these documents for my experts to review."

But here is where the game goes on ............  one of their experts if we chose to depose him charges $575 an hour for depositions.

And instead of sending the documents requested, they appear to have just copied a bunch of unrelated documents that are not relevant and not produce the ones that are.  So here is what Fidelity National Title Insurance Company has done on this claim:

1. Opened the claim on my behalf.
2. Determined it was a valid claim.
3. Bounced me all over the country from claims office to claims office.
4. Determined the claim was not valid, then determined it was.
5. Hired an appraiser from Boise Idaho to appraise a Napa Valley property.
6. Determined the value of the claim was $0.
7. Sent me from claims counsel to claims counsel.
8. Forced me to hire an attorney.
9. Requested a mound of documents which I produced.
10. Had a deposition of the person who verified their Answer scheduled but cancelled after we all went to Walnut Creek.
11. Produced their documents weeks late and then sent red herrings or "forgot" the herrings completely.
12. Made the claims counsels and appraiser not available due to distance and/or expense of producing them.
13. Have chosen an absurdly expensive "expert" just to run up costs.

Obviously all they want to do is make my life as miserable as possible so that I will go away.

So take my right leg...............

So one of the arguments that has been made by Fidelity National Title Insurance Company is that although I lost an almost mile long easement through residential property - my 80 acre parcel was not land locked as there was still a deeded easement through the commercial/manufacturing property.  And therefore I obviously had no loss as it was determined that my loss was $0.

Again I attempted to address this with the Fidelity Claims Counsel with an illustration that perhaps he could understand.

A top soccer player who kicks with their right leg is in an automobile accident severing their right leg.  And their insurance company decides that there is not loss - after all our soccer player has another perfectly good leg to stand on !!!!!

I do not think I would be in this position if Fidelity National Title Insurance Company had taken any kind of a position of fairness at the beginning of this claim  that their title officer filed on my behalf.  What do I feel is "fair" now?

• An amount that represents my actual financial loss of the easement
• An amount that represents the hundreds of hours I have had to invest to get them to pay the claim
• An amount that represents the stress and anger that this has caused me
• An amount that pays for all of the lawsuit actual fees - filing fees, expert fees, etc.
• An amount that compensates my attorney

All I have ever wanted was for Fidelity National Title Insurance Company to do what they say that they do - protect my interest in my investment.  Is that too much to ask?

I did not open the claim.  I did not "verify" that I had a claim.  Both were done by employees of Fidelity.  So then why would a value of $0 be determined as the loss for this claim.  Why bother opening it in the first place?  Why bother determining that there is a valid claim?  And how can anyone associated with Fidelity honestly say that the value of this loss is $0?????????????????

Commercial vs. Residential Entrance to the Property

One (but hardly all) of the objections I had to the appraisal done by the appraiser from Boise Idaho was that he contributed the loss of an easement through residential estate property to $0 leaving only a deeded entrance through a commercial/manufacturing facility - a winery.  He did not compare the subject property to one property with such an entrance.

Early on (Claims Counsel #3 for Fidelity National Title Insurance Company who was in Omaha Nebraska) I attempted to explain the difference in terms that he could understand.

"Now when I think of Omaha I think of steak.  Imagine each of these properties not with their current entrance but through a stockyard then past the slaughterhouse and the store selling the steaks that hundreds of customers are going to especially on the weekends.  Okay – I admit that a vineyard does not smell like a stockyard and a grape does not look at you with those big brown eyes before sacrificing it’s little life for a bottle of wine but………  I believe you may see my point.  The entrance to the subject property has changed from a private estate quality entrance to through a stockyard (okay – a vineyard is a little different) but past the slaughterhouse (winery) and the store (tasting room and sales room) hosting hundreds of visitors, weddings and other large receptions.  THE LOSS OF THE NORTHERN ACCESS HAS HAD A HUGE AFFECT ON THE VALUE OF THIS PROPERTY."

Not that this made any difference as he and the appraiser just continued to ignore me.  I also attempted to explain this same difference to the attorney #1 for representing Fidelity for the lawsuit by using an example in Walnut Creek.  I think just maybe he got it.  Of course, he has been replaced - twice I think.

Just getting angrier and angrier

The more I am thinking about this the angrier I am getting.  First, these documents were due on November 5th.  They arrived today - the 20th.

And my attorney started looking at the disc and asked me if I was ever sued by an attorney in Washington state about a property in Portland that was foreclosed on.  I cannot even imagine what this is about.  Unless as I said rather than send the documents asked for - they just arbitrarily grabbed papers and scanned them into this disc to make it difficult.  I think this is called red herrings- right?

It reminded me of one of the response letters from the appraiser from Boise Idaho.  He started rambling in the middle of the letter about the price per ton of red grapes in 2006.  Now although this may seem like a pertinent fact to include in an appraisal for a property in the Napa Valley - one does have to wonder what this has to do with loss of an easement in 2008 - especially since no grapes gave up their lives for the easement.

Perhaps tomorrow I will describe my Omaha steak analogy.

So the documents finally came - hahahaha

My attorney just called and the attorney for Fidelity National Title Insurance Company claimed that the disc was just sitting on the receptionist's desk???????????????  Right.

So the file is too large to email but my attorney said that there is a document from a Washington state attorney about a property in Portland Oregon???

Are they serious?  Or did they just put every single piece of paper they could possibly find and send them to hide what we really asked for?

Stay tuned...........................

Still no documents from Fidelity National Title Insurance Company

From my attorney to Fidelity's attorney at 5:34 PM today.  Need I say more?

"I have still not received the documents or your amended response to request for documents."

Title Insurance is "insuring pig iron underwater...with a rust exclusion"

I keep running across the same figure that only 5% of the premiums for title insurance are allocated to paying losses.  Far far less than any other form of insurance.

I just found this great article from Mortgage News Daily by Rob Chrisman dated August 3, 2011

Perspective on Rejected Title Insurance Claims

Part of his article reads:


Monday the commentary discussed claims with title companies. "I just wanted to comment on the subject of claims with the title companies. I can tell you I had a personal claim against a national title company that missed some back taxes owed by the previous owner on a short sale. The county contacted me and said I was responsible for these back taxes, but that it was the title company's fault and I should contact it. Even though it was a clear case of the company being at fault the claim was denied. I had to eventually hire an attorney and threaten a lawsuit before getting them to settle. It took a lot of time and resources to get it to admit fault even though I had clear documentation from the county etc. I just thought I would share as this seems to back up what you are hearing."

One reader wrote, "As far as I can tell, from over 20 years of experience in this business, rejection of virtually all title claims by the insurer has been standard operating procedure. This is not a new phenomenon. In fact, a similarly jaded former Chairman of a small Midwestern thrift (long since deceased) once was heard to say that title insurance is "insuring pig iron underwater...with a rust exclusion". The economics of title insurance are vastly different from ordinary insurance with upwards of 80% of all premiums being paid to title agents merely for delivering the business. Only about 5% of all premium income is allocated to paying losses (the rest is administrative expense-such as lawyers to fight claims). The economics of casualty insurance, on the other hand, are reversed. There is rarely accountability between the purchaser of title insurance and the person making a claim (consider in many states the seller buys the insurance), but it's the buyer (or lender) who will have to pursue the claim. As a result, there is no need to have a good claims paying history since the buyers of their insurance never have to deal with a claim denial. In fact, if you think about it, if the title company does a proper search and knows the applicable law, the risk of loss should be zero. It is not as if a random occurrence like a tornado can hit your title and cause it to change. Title insurers are really just insuring their own negligence (and malfeasance) on the front end. Title losses were covered up by rising real estate values generally during the first half of the 2000's. Now, mortgage holders are seeking to hold title insurers liable for title losses whenever possible, many of which are really the result of fraud. Title claim volume has no doubt increased, so title insurers are just continuing their business model (of not paying claims easily) in more visible fashion."

And the rudeness goes on......................

From my attorney to the attorney for Fidelity National Title Insurance Company:

"I have not received the documents and yet we have deadlines approaching and my expert will need to see these documents before finalizing any report."

It is amazing to me the rudeness and unprofessional behavior that is shown by a company of this size and reputation.

After the claim was filed on my behalf by their own title officer I was shuffled around, ignored, not communicated with and not listened to.

Their attorneys have allowed us to drive to Walnut Creek for a deposition knowing full well that the person who was suppose to be deposed not only was not there - but actually knew nothing about the claim even though he had "verified" the Answer to the Third Amended Complaint.

And now they do things like ten days after the date for producing documents send a blank disc and now we are still waiting for the documents.  As it is Friday - it can only be assumed that we might get them on Monday which will be two weeks past the date they were due.

So what are they trying to hide??????????????????

No documents yet today from Fidelity National Title Insurance Company

It makes me wonder why I spent a dozen hours producing every single document in a timely fashion?  Especially since whoever is producing their documents is getting paid.

Insurance Companies and Sandy

I was watching the news this morning and there was a woman on Staten Island who was having a difficult time with her insurance company which caused me to do an Internet Search.

Sen. Schumer Warns Insurance Companies Against ‘Playing Games’ With Sandy Victims

Per this article Sandy was classified as a tropical storm when she reached the coast of New Jersey rather than a hurricane.  If classified as a tropical storm the homeowner's deductible is $1000 but if classified as a hurricane the deductible is $20,000.

Per the article the insurance companies are pressuring the NOAA (National Oceanic and Atmospheric Administration) , the weather agency, to reclassify Sandy as a hurricane to be able to change the amount of deductible that the homeowners have to pay substantially.

Haven't the people in Sandy's path been through enough without having to fight their insurance companies especially when the NOAA has already classified the storm?

Is it the job of insurance companies to protect the insured or their stockholders?

Documents were due November 5th from Fidelity

So ten days later and still no sign of the documents.  Just a blank disc sent to my attorney.

It just has to make one wonder...............................................

So Fidelity's attorneys sent documents !!!! Just kidding............

"There were no files on the disc which you sent me. Can you send me a disc which has something on it."

My attorney's comments.

Just wondering ????

Still No Documents from Fidelity National Title Insurance Company

So my attorney was gracious enough to give the attorney for Fidelity National Title Insurance Company a week's extension on producing the requested documents.  That extension was yesterday.  Still no documents nor any communication for Fidelity's attorney.

Am I surprised???
Is this standard procedure for the way Fidelity handles claims and lawsuits???
Are they just trying to hide something???

This also delays the deposition of the remaining (at least I think he is the only person still employed by Fidelity) Claims Counsel - as difficult as it is since this claim was transferred to Omaha Nebraska from Walnut Creek California.

Was this transfer made just to make it difficult????  It was impossible for me to meet with the person handling my claim due to the distance.  Now I wonder if this transfer to so far away was just to make pursuing a legitimate settlement of the claim difficult????

Again Another Attorney !!!!

I just spoke to my attorney and I guess I misunderstood and since we filed the lawsuit against Fidelity National Title Insurance Company - we are now on our third attorney.  Moving up the ladder I think.

Lee v. Fidelity National Title Insurance Company

Fidelity National Title Company's legal description and erroneous references were resolved in favor of the reasonable expectations of coverage by the Insured.

The California Court of Appeal, First Appellate District, reversed an order granting summary judgment to a title insurer arising from a dispute in ownership of a parcel of land, where the title insurer provided a preliminary report that mistakenly referred to Plaintiffs’ land as comprising of two parcels, although the metes and bounds legal description of the land was accurately stated. 

Plaintiffs are purchasers of land who, at the time of the sale, believed they were buying two parcels of adjoining property, identified as Assessor’s Parcel Number (“APN”) 042-230-090 (“APN 9”) and 042-230-220 (“APN 22”). The purchase contract identified the property Plaintiffs were buying as APN 9 and APN 22.

In my case Parcels Two, Three, Four and Five were in not only the Preliminary Title Report but also in the Grant Deed and from a meeting with the Title Officer in Napa California I was lead to believe that I had two deeded easements from Mount Veeder Road to my property.

Years later, when Plaintiffs decided to sell their property, an investigation uncovered that APN 22 actually belonged to a neighboring property owner. The county assessor advised both Plaintiffs and the neighboring owner that taxes on APN 22 had been erroneously assessed to Plaintiffs, the error dated back to when title to Plaintiffs’ land was conveyed to Plaintiffs’ sellers, and thus title to APN 22 was held by the neighbor, not Plaintiffs.

Years later, when i decided to sell my property, an investigation uncovered that  Parcels Two, Three, Four and Five should not have been conveyed to me as the easement described did not go reach my property.

Plaintiffs’ counsel informed Fidelity of the county assessor’s determination and demanded Fidelity “obtain clear title in favor of [Plaintiffs].” Fidelity’s counsel sent Plaintiffs a letter denying coverage of Plaintiffs’ dispute over ownership of APN 22 because Plaintiffs held title to the legal description as set forth in their grant deed (echoed in the preliminary report) and were insured to hold title to no more than that which is described there. 

In my case I was not denied coverage as the claim was opened by the Fidelity National Title Company Title Officer but the loss of Parcels Two, Three, Four and Five where valued at $0 by an appraiser from Boise Idaho.

Plaintiffs subsequently filed suit against Fidelity for declaratory relief, breach of insurance contract, bad faith, and escrow negligence.

I, too, have filed suit against Fidelity National Title Insurance Company.

The Court of Appeal held that while the preliminary report shall not be construed as a representation as to the condition of title, it “shall constitute a statement of the terms and conditions upon which the issuer is willing to issue its title policy, if such offer is accepted.” The preliminary report, then, is an offer identifying the risk the insurer will agree to assume, which the insured accepts by buying the title policy, and the insured has the right to reasonably expect that the contract thus formed will be consistent with the terms of the offer. 

I not only had the Preliminary Title Report but I went to the Napa California office of Fidelity National Title Company and met with the Title Officer who showed me on the parcel map all six of the parcels listed in the Preliminary Title Report that were subsequently also in the legal description on the Grant Deed also prepared by Fidelity National Title Company.  I thought (reasonably expected) that I had two deeded legal easements from Mount Veeder Road to the property.

The Court of Appeal cautioned to determine if there is an ambiguity, it would look to the “ordinary reading” of words in the insurance policy that are to be interpreted according to the plain meaning which a layman (not an attorney or insurance expert) would ordinarily attach to the words. The Court of Appeal concluded the legal description in Fidelity’s preliminary report was ambiguous because laypersons like Plaintiffs would have no way of knowing from the surveyor’s metes and bounds description of the land in their title policy whether APN 22 was covered. In addition, further ambiguity was created in Fidelity’s report by the attachment of the assessor’s parcel map with an arrow pointing to APN 22 and listing APN 22 in the property’s address. The Court held Fidelity’s preliminary report can be reasonably construed as an offer to insure APN 22 and Plaintiffs could have reasonably expected, under the circumstances, that they were buying a title insurance policy on APN 22 that would conform to the preliminary report.

Although we are just at the discovery period I believed not only from my reading of Parcels Two, Three, Four, Five and Six that I had two legal easements from Mount Veeder Road to my parcel but also these parcels were all listed in my Grant Deed.  And I thought that these easement were not only deeded but also insured.

Needless to say there will be more to write about as this lawsuit continues on.

But I have so many questions. 

Insurance Claims and Settlements

The one thing that I am learning is the importance of research of how other people and their attorneys have successfully navigated this tangled web with their insurance claims and settlements.  It appears that this is necessary in order to achieve a just settlement or outcome with an insurance company such as Fidelity National Title Insurance Company or Fidelity national Title Group or Fidelity National Financial.

It appears that insurance companies are renowned for either not paying claims, paying low settlement amounts or withholding the release of settlement funds until the absolute last possible second.  These are implemented as both money making and money preserving techniques.  Major insurance companies like Fidelity National Financial and its subsidiary Fidelity National Title Group have billions of dollars due to high revenues and cash flow.  Like banks, they invest these funds in order to increase their profits.  Even if a claim should be paid that they cannot avoid paying, they will hold the money as long as legally possible in an effort to increase their own profits through the interest they earn on their investments.

Per my research in addition to delaying the payment of settlements, most insurance companies implement many of the following strategies to cut costs and generate profit:

• Nickel and dime individual clients with various charges with the knowledge that the clients cannot afford to investigate their legal options.
• Make the process lengthy and difficult by constantly changing the personnel handling the claim and moving the client from claims office to claims office.  Sound familiar?
• Provide "expert" evaluations of the value of the loss that are misleading and/or inaccurate knowing that the clients cannot afford to investigate the value of the claim on their own.
• Present clients with a very small initial settlement offer, as many policy holders do not realize they do not have to accept the insurance company's first offer nor questions the validity of the valuation.  (Such as value the loss of an easement to Mt. Veeder Road in Napa County with a value to an existing easement to Cavedale Road in Sonoma County.)
• Wait until the last possible week to disperse the payment of the settlement knowing that this process can last for years.  (It has now been 4 1/2 years since this process started for me.)

The bottom line appears from my research to be the bottom line of profits for Fidelity National Financial and its subsidiary Fidelity National Title Group and subsequently its stockholders- its employees.  The same people who process the claims.

More Research on Fidelity National Fianancial

Per Wikipedia and other sources Fidelity National Financial (NYSE:FNF) is headquartered in Jacksonville, Florida (formerly Santa Barbara California.)  It is a Fortune 500 company that provides real estate and financial services.  The company is comprised of three primary subsidiaries: Fidelity National Title Group, Fidelity property and Casualty Insurance Group, (both wholly-owned) as well as Sedgwick CMS, a minority-owned subsidiary.

Fidelity National Title Group (FNTG), a subsidiary of Fidelity National Financial (FNF) was established in 2005.  it provides title insurance and escrow services.  Title insurance brand names in the Fidelity National Title Group include Aero Records and Title, Alamo Title Insurance, Chicago Title Insurance Company, Fidelity National Title, Lawyers Title, Security union and Ticor Title Insurance.  The Fidelity national Title Group website claims that the group underwriters issue approximately half of the title insurance contracts in the United States.  Fidelity National Title Group provides additional real estate related services through brand names such as Fidelity National Home Warranty, Service Link, and Fidelity Residential Solutions.

The one thing I have not been able to find out is that if Fidelity National Title Group was established in 2005 what companies existed before then?  What company represented me on the title search in 2003 and 2004?  What company represented me in the escrow in 2003 and again in 2004?  What company actually insured m title in 2003 and 2004?

I would obviously welcome any comments if anyone has the answer to these questions.

Learning more about how insurance works

i have spent a lot of time over the last four years and the payment of claims and the motivation to pay claims leaves me with many questions.

For example, if you are in a car accident and it is not your fault it is obvious that your insurance company will defend you so that the other driver's insurance has to pay.

But as with the case with Katie Fisher and Progressive insurance where she lost her life when hit by another driver.  The other driver's insurance paid the Fishers the $25,000 owed by that driver's policy but Progressive apparently attempted to prove that Katie was at fault so that they would not have to pay the Fishers the additional $75,000 in under insured motorist insurance.

And with my title insurance claim - Fidelity National Title Insurance Company did not question when the neighbor's title insurance company said that I did have an easement across their property.  Actually instead of attempting to protect my interest they confirmed that the other company was correct in their analysis and opened a claim on my behalf for the easements that they recorded to my benefit in my Grant Deed.

So what happened next?  The Claims Counsel concurred with the Fidelity National Title Company Title Officer that I had a valid claim.  But then as I was shuffled across the country from Claims Counsel to Claims Counsel it was determined that the value of my claim was $0.

Why????

Huffington Post Article

Apparently per my understanding the insurance industry in California and other states is unique in that it is required to act in good faith - also known as the covenant of good faith and fair dealing - with its insured customers.

This Huffington Post article "Insurance Claim Delays Deliver Massive Profits To Industry By Shorting Customers" from December 2011 states that "a new profit-hungry model, combined with weak regulation, has upended that ancient social contract" between the insured and the insurance companies.

I, of course, do not know if this is the principle that was being applied in the case of my claim but it is interesting that the claim was filed on my behalf by Fidelity, determined by Fidelity to be a valid claim and then assigned the value of the claim for the loss of an almost mile long easement to an 80 acre parcel over looking the Napa Valley at $0.  Is this a coincident?