Riordan v. Lawyers Title Insurance Corporation

393 F.Supp.2d 1100 (2005)

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Nature of the Case

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Facts

Ps were owners of 160 acres of real property located in an 'in-holding' in the middle of the Sandia Mountain Wilderness of the Cibola National Forest near Albuquerque, New Mexico. D issued an insurance policy insuring P's title to the Property. At all relevant times, the Property has been accessed by the Piedra Lisa Trail, which is a hiking and horse trail maintained by the United States Forest Service ('USFS'). The Property is located two and a half miles from the nearest paved road. The Trail was and is unsuitable for vehicular access. At the time, P purchased the Property in 1995, there were several former roads that had been used to access the Property, including roads that were accessible by jeep. Before P purchased the Property, the prior owner represented that he had accessed the Property by jeep over an access route other than the Piedra Lisa Trail. P testified that a USFS employee informed P that the Property had vehicular access and suggested the access route was near the original homestead on the Property. P purchased the property for $225,000. Prior to closing, P visited the Property by walking and riding his horse on the Piedra Lisa Trail. D issued the owner's policy of title insurance which as part of the policy included: Unmarketability of the title; and Lack of a right of access to and from the land. P brought the Primary Action to declare a vehicular right of way to the Property. The United States raised affirmative defenses in the primary action but did not assert counterclaims. In September 2002, the property appraised for $2.8 million. P sold the property to Sandia Pueblo for $1.3 million and a tax deduction for a $1.5 million charitable donation to the Pueblo. Ps then made three demands for payment under the policy. The demands were rejected. Ps claimed lack of vehicular access as the grounds for their claim against D. P claimed that the lack of access also rendered the property title unmarketable. Ps sued D and D moved for summary judgment.