Equity Income Partners LP v. Chicago Title Ins. Co
In Equity Income Partners LP v. Chicago Title Ins. Co., 2012 WL 3871505 (D. Ariz. Sept. 6, 2012), Equity loaned over two million dollars to the owners of two properties.
Equity obtained lender's title insurance from Chicago Title. Id.
The owners of the properties discovered they were precluded from legally accessing the properties and stopped making loan payments to Equity. Id.
Equity filed suit against Chicago Title, alleging the starting point for valuation of the properties should be the date that Equity learned of the undisclosed defects.
Chicago Title argued that the date of foreclosure should determine the diminution in value to the properties. Id.
The federal district court held the date of the loan was the proper valuation date, relying on the court's analysis in Citicorp Sav. of Illinois v. Stewart Title Guar. Co., which reasoned that "because the policy was breached at the time of the loan, the title insurer should bear any risk of market value decline in the property at that time."