Case Name: Chauncey M. Mayers, Appellant, v. George S. Van Schaick, as Superintendent of Insurance of the State of New York, Respondent
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1935-07-11
Citations: 268 N.Y. 320
Docket Number: 
Parties: Chauncey M. Mayers, Appellant, v. George S. Van Schaick, as Superintendent of Insurance of the State of New York, Respondent.
Judges: Crane, Ch. J., Lehman, O’Brien and Crouch, JJ., concur with J.; Finch, J., dissents in opinion in which Hubbs, J., concurs.
Reporter: New York Reports
Volume: 268
Pages: 320–327

Head Matter:
Chauncey M. Mayers, Appellant, v. George S. Van Schaick, as Superintendent of Insurance of the State of New York, Respondent.
(Argued April 30, 1935;
decided July 11, 1935.)
Leopold K. Simon and Ralph S. Goodman for appellant.
The assessment became a lien when it was completed and confirmed. (Cons. Laws, ch. 64, §§ 113, 116, 280; Lathers v. Keogh, 109 N. Y. 583; Burr v. Palmer, 53 App. Div. 358.) The existence of the assessment was a risk against which the title company agreed to insure and respondent is Hable to appellant in the amount thereof. (.Empire Development Co. v. Title Guarantee & Trust Co., 225 N. Y. 53; 755 Seventh Ave. Corp. v. Carroll, 266 N. Y. 157.) The measure of appellant’s damages is either the amount of the assessment or the difference between the value of the property subject to the assessment and free from it. (Murphy v. U. S. Title & Guaranty Co., 104 Mise. Rep. 607; Empire Development Co. v. Title Guarantee & Trust Co., 225 N. Y. 53; 755 Seventh Ave. Corp. v. Carroll, 266 N. Y. 157.) The agreement of the title .company was to insure against the existence of any and all Hens and incumbrances not noted in its certificate. (Clarkson v. Western Assur. Co., 92 Hun, 527; Hay v. Star Fire Ins. Co., 77 W. M. 235.)
Jess H. Rosenberg, Joseph J. Corn, Jr., Irving H. Jurow and Harry Rodwin for respondent.
The assessment did not create a Hen upon the property. (McNamara v. City of Rochester, 124 Mise. Rep. 229; Real Estate Corp. v. Harper, 174 N. Y. 123; Matter of Sobol v. Common Council, 233 App. Div. 158.) Defendant is not Hable under the express terms of the policy to which plaintiff’s certificate is subject. (De Grove v. Metropolitan Ins. Co., 61 N. Y. 594; Lipman v. Niagara Fire Ins. Co., 121 N. Y. 454; Karelsen v. Sun Fire Office of London, 122 N. Y. 545.)

Opinion:
Loughran, J.
On May 8, 1928, the Board of Trustees of the village of. Scarsdale resolved to establish a village park and playground and to assess seventy per cent of the expense of that improvement against the owners of lands designated upon an assessment map as comprising the district to be benefited thereby. The cost of the project having meantime been determined, the Board, on June 12, 1928, apportioned seventy per cent thereof upon the respective properties so assessed, including premises of Eleanor M. Grieve against which was allotted $960.65 of the localized burden.
The Board then further resolved: " That the said assessments become due and payable in forty equal annual installments commencing with the year 1929, with interest on unpaid balances at the rate of four and one-quarter per cent per annum; * ⅜ ⅜ and that the amount of the said assessments falling due in any year, including interest, shall be included in the annual tax levy of such village for such year and become due concurrently with the general village tax." These proceedings were taken and completed pursuant to section 280 of the Village Law (Cons. Laws. ch. 64) and within fifteen days thereafter became final and conclusive accordingly.
On May 22, 1933, Lawyers Title and Guaranty Company issued to plaintiff its certificate that title to the premises of Eleanor M. Grieve in the village of Scarsdale was, as of that date, vested in her " clear of all requirements, hens, encumbrances and defects except as in said instrument noted, and agreed to insure plaintiff against the existence of any and all requirements, hens, encumbrances and defects not therein noted." In rebanee on this instrument, plaintiff thereupon purchased the title thus insured. The certificate made no reference to the above-mentioned local assessment to be borne by the premises after 1928, as part of the expense of the park and playground improvement laid out in that year by the Trustees of the village of Scarsdale. Installments of this assessment had been paid to and including 1932. Under the resolutions of the Trustees, further installments were to become due annually thereafter to and including 1968, in the aggregate sum of $863.97.
This is an action to recover that sum as the amount of a liability covered by the certificate of title insurance issued to plaintiff by Lawyers Title and Guaranty Com No cause of action for negligence in searching the insured title is alleged. The Superintendent of Insurance, as rehabilitator of Lawyers Title and Guaranty Company, is made defendant. The Special Term granted his motion for judgment on the pleadings and dismissed the complaint. The Appellate Division affirmed. Plaintiff is here by leave of this court.
Title insurance operates to protect a purchaser or a mortgagee against defects in or incumbrances on a title existing at the date of such insurance. It is not prospective in its operation and has no relation to hens or requirements arising thereafter. (Trenton Potteries Co. v. Title Guarantee & Trust Co., 176 N. Y. 65, 72.) The full form of the certificate of insurance of plaintiff's title is not before us. We have only so much of the text as has been quoted from his pleading. On that text, the issue is whether the unpaid installments of the assessment in question were on May 22, 1933, an existing requirement of, or a hen or incumbrance on, or a defect in, the title then acquired by plaintiff. His contention that such a hen existed at that time is based upon sections 280, 116 and 113 of the Village Law. We find no warrant for his position in these sections.
Section 280 contains the provisions under which the assessment was laid. That section does not provide that any assessment for a local improvement thereby authorized shah be a hen on property benefited. By subdivision 6 of that section it is provided (and the village Trustees here so resolved) that: " If the said assessments are payable in more than one installment, the amount thereof becoming due in any year may be included in the annual tax levy of such year and in case of default in payment said assessments, with interest and penalties, may be collected in the same manner as delinquent village taxes." Section 116 provided: " The annual village tax is a hen ⅜ ⅜ on real property on which it is levied from the fifteenth [now the first] day of June of the year in which it is levied
AJI installments of this assessment were paid to and including 1932. No installment unpaid on May 22, 1933 (the date on which the certificate of insurance issued), was then a hen on this title, or could become such a hen before June 15 of that year, by force of anything provided in sections 280 and 116 of the Village Law.
Section 113 of that statute has no apphcation here. It defines the effect of assessments for named purposes which do not include the local improvements authorized by section 280.
A village board of trustees " may declare and provide that the cost of ah local improvements or of any other work or benefit to or for abutting property as determined by it, shah be a hen upon the property." (Village Law, § 89, subd. 38.) The Board of Trustees of Scarsdale here elected not to follow that course, but rather to adopt the optional alternative method made available by section 280 of the statute. (See subd. 7.)
It follows, we think, that Lawyers Title and Guaranty Company no more agreed with plaintiff to protect him against habihty for the unpaid assessment in question than it undertook to indemnify him for taxes to be levied against the premises after dehvery of its certificate of title insurance.
/The judgment should be affirmed, with costs.