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Transamerica Title Insurance Co.  v. Johnson

Supreme Court of Washington
693 P.2d 697 (1985)


Johnson (defendant) was a corporation in the business of residential development and home building. Johnson purchased vacant lots that were subject to preliminary assessments for sewer district utilities. Johnson entered into earnest money agreements for sale of the lots to private purchasers. The earnest money agreements did not assign responsibility for the sewer assessments to the buyers. Johnson hired Transamerica Title Insurance (plaintiff) to prepare preliminary title insurance commitments and issue title insurance policies. The sewer district assessments were finalized and became liens against the lots prior to the time that Transamerica issued its preliminary commitments. The preliminary commitments and insurance policies did not disclose the sewer assessments. Transamerica was required to pay the sewer assessments on behalf of the insured purchasers. Transamerica filed suit against Johnson to recover the amount of the assessments. The trial court granted summary judgment in favor of Transamerica. The appellate court affirmed the trial court judgment. Johnson petitioned the supreme court for review.

Rule of Law


Holding and Reasoning (Brachtenbach, J.)

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