Court Opinion

ID: 6788671
Source: CourtListenerOpinion
Date Created: 2022-07-21 01:07:25.959611+00
Date Added: 2024-06-11T16:03:00.140034
License: Public Domain

Lanzinger, J.,
dissenting.
{¶ 47} I agree with the majority that a title insurance policy issued in response to an unqualified request for coverage but not delivered until after the closing is binding. But I dissent because, in my view, the evidence establishes that an arbitration clause is a usual and customary term in the 1992 American Land Title Association (“ALTA”) owner’s policy for title insurance.
{¶ 48} As a general rule, federal and state courts encourage arbitration to resolve disputes. ABM Farms v. Woods (1998), 81 Ohio St.3d 498, 500, 692 N.E.2d 574. On the federal level, the Federal Arbitration Act (“FAA”) shows the liberal federal policy favoring arbitration. Section 1 et seq., Title 9, U.S.Code; Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp. (1983), 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765. In Cone, the United States Supreme Court stated that “questions of arbitrability must be addressed with a healthy regard for the federal policy favoring arbitration.” Id. Likewise, Ohio’s policy of encouraging arbitration has been declared by the legislature through the Ohio Arbitration Act, R.C. 2711.01 et seq. This statute mirrors the FAA in many respects. R.C. *2762711.01 states that arbitration clauses “shall be valid, irrevocable, and enforceable” except on grounds applicable to revocation of any contract.
{¶ 49} ALTA creates forms of title insurance policies for the Ohio Department of Insurance to approve and for title companies in the state of Ohio to use. In keeping with the federal and state trend toward favoring arbitration as a means to settle disputes, ALTA began incorporating arbitration clauses into its title insurance policies in 1987. Furthermore, each of the title insurance companies in Ohio uses the approved ALTA forms.
{¶ 50} The majority emphasizes the testimony of Terry Endress, the vice president and area manager of Lawyers Title, and specifically relies on his statement that arbitration provisions are “in some policies, and they are not in other policies” to support invalidating the arbitration provision. However, by highlighting his statement, the majority obscures the fact that arbitration provisions have been in three of the last five ALTA title insurance policies, promulgated in 1970,1984,1987,1990, and 1992. Although arbitration provisions are not in the 1970 or 1984 versions, they are in each policy form beginning in 1987. Thus, while I do not dispute that arbitration provisions were not a usual and customary term ten years ago, their inclusion in the 1987, 1990, and 1992 policies shows the title insurance industry’s intent to establish arbitration as a usual and customary feature. Recognizing this intent comports with both federal and state policy favoring arbitration.
{¶ 51} Endress testified that the company’s custom and routine practice is to issue the most recently approved ALTA policy when a customer makes an unqualified request for an owner’s policy of title insurance. When a contract for an insurance policy is entered into, with nothing said about the terms, the parties are presumed to intend that the policy will contain the usual and customary provisions found in insurance policies in like cases. Avemco v. Eaves (1990), 67 Ohio App.3d 563, 568, 587 N.E.2d 900, citing Newark Machine Co. v. Kenton Ins. Co. (1893), 50 Ohio St. 549, 556, 35 N.E. 1060.
{¶ 52} In the present case, the Hendersons made an unqualified request for a title insurance policy. For Lawyers Title, the usual and customary practice was that, following an unqualified request for title insurance, it would issue the most recently approved ALTA policy. At the time of the Hendersons’ transactions in 1999, the most recently approved policy was the 1992 ALTA policy, which contained an arbitration clause. The majority suggests that in order for a term to be usual and customary, there must be consistency and regularity in its use. Lawyers Title established that as a routine practice, it issues title insurance policies containing arbitration provisions following an unqualified request for coverage and that arbitration provisions have been in all ALTA policies since 1987. I would hold that there is evidence of consistent and regular use to *277establish arbitration as a usual and customary term and would, therefore, reverse.
Ulmer & Berne, L.L.P., Marvin L. Karp, and David D. Yeagley; Sonkin & Koberna Co., L.P.A., Mark R. Koberna, and Rick D. Sonkin, for appellees.
Collins & Scanlon, L.L.P., Thomas J. Scanlon, Tim L. Collins, and M. Scott Wilson, for appellant.
Benjamin, Yocum, & Heather, L.L.C., Timothy P. Heather, and Brian A. Lee, urging reversal for amicus curiae Ohio Association of Civil Trial Attorneys.
Vorys, Sater, Seymour & Pease, L.L.P., William D. Kloss, and Michael Thomas, urging reversal for amicus curiae Ohio Insurance Institute.
Thompson Hiñe, L.L.P., William C. Wilkinson, and Jennifer E. Short, urging reversal for amicus curiae Ohio Land Title Association.
Lundberg Stratton, J., concurs in the foregoing opinion.