Opinion ID: 754757
Heading Depth: 4
Heading Rank: 1

Heading: national title & sartain

Text: 29 The appellants' only evidence of any misrepresentation on the part of National Title and Sartain is the warranty deeds and folders. See J.A. at 121, 122 (Sartain Aff.); J.A. at 168-69 (Barnes Dep.); J.A. at 193 (J. Merritt Dep.); J.A. at 225 (E. Merritt Dep.); J.A. at 298 (Wynn Dep.); J.A. at 311-22 (Newman Dep.). 30 We hold that the preparation and the delivery of the warranty deeds create a genuine issue of material fact as to National Title's and Sartain's liability for negligent misrepresentation. The first element of the John Martin test is met because National Title and Sartain prepared the warranty deeds as part of their business. There is a dispute as to whether the three remaining elements are met. We hold that the evidence in this case presents a genuine issue of material fact as to whether National Title's and Sartain's preparation and delivery of the warranty deeds conveyed faulty information meant to guide the appellants in their purchase of their properties. The existence of a warranty guaranteeing that title was free and clear of all encumbrances was obviously part of the bargain in purchasing the properties. See, e.g., J.A. at 584 (Menuskin Sales Contract) (stating that [t]he Seller agrees to convey said property to the purchaser by general warranty deed free of all encumbrances, except as hereinabove set out, and Seller agrees that any encumbrances not herein excepted will be cleared at the time of closing.). By including the National Title logo on the documents delivered to the appellants, National Title and Sartain may have given the appellants the false impression that they had performed a title search. 31 The appellants also testified that they relied on the warranty deed before completing the closing. As it turned out, the information contained in the warranty deed was indeed faulty. The property was not free and clear of all encumbrances. The appellants claim that by not inserting a disclaimer on the warranty deed, indicating that National Title and Sartain assumed no responsibility for the information, National Title and Sartain failed to exercise reasonable care. The appellants point to such a disclaimer used in the past by National Title, which reads: This instrument was prepared from information furnished by the parties herein for which the preparer assumes no responsibility. J.A. at 855 (Plaintiff Ex. 56); see also J.A. at 858 (Plaintiff Ex. 57). The appellants also introduced testimony from a local attorney who stated that many title companies in the Chattanooga area included such a disclaimer. See J.A. at 1134 (Patrick Dep.). This evidence raises a genuine issue of material fact as to whether National Title and Sartain exercised reasonable care in obtaining or communicating the information to the appellants. 3 For these reasons, we reverse the district court's grant of summary judgment regarding the negligent misrepresentation claim against National Title and Sartain.