Opinion ID: 871623
Heading Depth: 2
Heading Rank: 1

Heading: The Harts' Title Insurance Policy

Text: This appeal arises from TICOR's refusal to defend the Harts under their title insurance policy against an escheat [2] claim asserted by the State of Hawai`i. The Harts purchased a title insurance policy from TICOR for their property comprised of two lots in Ewa Beach (Policy); TICOR issued the Policy on July 13, 2005. [3] The Policy provides, in relevant part: Subject to the exclusions from coverage, the exceptions from coverage contained in Schedule B and the conditions and stipulations, TICOR Title Insurance Company, a California corporation, herein called the Company, insures, as of Date of Policy shown in Schedule A, against loss or damage, not exceeding the amount of insurance stated in Schedule A, sustained or incurred by the insured by reason of: 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. The Company will also pay the costs, attorneys' fees and expenses incurred in defense of the title, as insured, but only to the extent provided in the Conditions and Stipulations. (Emphasis added). Additionally, the Policy includes the following Conditions and Stipulations, in relevant part: 4. Defense and Prosecution of Actions: Duty of Insured Claimant to Cooperate (a) Upon written request by the insured and subject to the options contained in Section 6 of these Conditions and Stipulations [entitled Options to Pay or Otherwise Settle Claims: Termination of Liability], the Company, at its own cost and without unreasonable delay, shall provide for the defense of an insured in litigation in which any third party asserts a claim adverse to the title or interest as insured, but only as to those stated causes of action alleging a defect, lien or encumbrance or other matter insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of the insured to object for reasonable cause) to represent the insured as to those stated causes of action and shall not be liable for and will not pay the fees of any other counsel. The Company will not pay any fees, costs or expenses incurred by the insured in the defense of those causes of action which allege matters not insured against by this policy. The Policy contains the following Exclusions from Coverage, in relevant part: 9. Claims arising out of customary and traditional rights and practices, including without limitation those exercised for subsistence, cultural, religious, access or gathering purposes, as provided for in the Hawaii Constitution or the Hawaii Revised Statutes. 10. Rights or claims of persons or entities other than the insured involving or arising out of: mineral or metallic mines; geothermal resources; water; fishing, commerce or navigation; creation or loss of the land or any portion thereof by accretion, avulsion, erosion or artificial means; persons residing on or otherwise in possession of the land or any portion thereof; trails, roadways or other rights of way, including without limitation any such rights or claims under Chapter 264, Hawaii Revised Statutes. Additionally, Schedule B to the Policy provides, in relevant part: All matters set forth in the paragraphs below the caption Exclusions from Coverage on the inside cover of this Policy and the following matters are expressly excluded from the coverage of this Policy and [TICOR] will not pay loss or damage, costs, attorney's [sic] fees or expenses which arise by reason thereof. ... 2. Location of the seaward boundary in accordance with the laws of the State of Hawaii and shoreline setback line in accordance with County regulation and/or ordinance and the effect, if any, upon the area of the land described herein.