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1: ~ ~ Definition of Term3. ~ '. _ .. .. ~ •~.
<br />The tallgving terms when used in this polity mean:
<br />sal 'insured': the insured named in Schedule b The tertn'insured' also
<br />includes:
<br />lit the owner of the indebtedness secured by the insured
<br />mortgage and each successor in ownership of the indebtedness except a
<br />successor who is an obligor under the provisions of Section 121c1 el these
<br />Condition; and Stipulations (reserving, however, all rights and defenses as to
<br />any suuessor that Ilse Company would have had against any predecessor
<br />insured, unless the successor acquired the indebtedness as a purchaser for
<br />value without knowledge of the asserted defect. lien, encumbrance, adverse
<br />Clain ar other matter insured against by this policy as affecting title to the
<br />estate or interest in the lands:
<br />Iris any governmental agenry or govemmental instrumentality
<br />whit h is an insurer or guarantor under an insurance contract or guaranty
<br />insu ing nr guaranteeing the indebtedness secured by the insured mortgage, or
<br />any aan thereof, whether nan.~...r an insurrd herein or nat.
<br />liiil the parties designated in Section 21a1 of these Conditions and
<br />Stipulations.
<br />Ibl "insured claimant": an insured claiming loss or damage.
<br />Icl "knowledge' or `known`: actual knowledge, not constructive
<br />knowledge or nonce which maybe imputed In an insured by reason of the
<br />public records as defined in this policy or any usher records which u^yan
<br />constructive nonce of mauers affecting the land
<br />IdJ "land": the land described or referred to in Schedule A, and
<br />improvements affixed thereto which by law constitute real property The term
<br />"land` does not include any property beyond the lines of the area described or
<br />referred to rn Schedule A, nor any right, title, interest, estate er easement in
<br />abutting streets, roads, avenues, alleys. lanes, ways or waterways, but nothing
<br />herein shall modify or limit the extent to which a right of access to and from the
<br />land is insured by this policy.
<br />let "mortgage". mortgage. deed of trust, trust deed, or other security
<br />instrument.
<br />Ifs public records': records established under state statutes at Date of
<br />Policy for the purpose of imparting constructive note of matters relating to real
<br />preT~eny to purchasers for value and without knowledge. With respect to
<br />Sec:ron tlaNrvl of the Exclusions from Coverage. "public records" shall also
<br />include environmental protection liens filed in the retards of the clerk of the
<br />United States District Court for the district in which the land is located.
<br />Igl "unmarketabrlity of the title°: an alleged or apparent matter
<br />affecting the title to the land, not excluders sir excepted (rem coverage, which
<br />would emote a purchaser of the estate or interest described in Schedule A or
<br />the insured mortgage to be released from the obligation to purchase 6y virtue of
<br />a contractual condition requiring the delivery of marketable title
<br />7 Conhnuaoon of Insurance.
<br />sal After Acquisition of Title. The coverage of this policy shall continue
<br />in farce as of Date of Policy in favor of lit art insured who acquires all or any part
<br />of the estate or interestvn the land by lorrr.losure, trustee's sale, conveyance in
<br />lieu of foreclosure, or other legal manner which discharges the lien of the
<br />insured mortgage: lul a transferee of the ostate or interest so acquired from an
<br />insured corporation, provided the transferee is the parent or wholly~owned
<br />subsidiary of the insured corporation, and their corporate successors by
<br />operation of law and not by purchase. sulgcct to any nghls or defenses the
<br />Company may have against any predecessor insureds: and Isis) any
<br />governmental agency er governmental in,lrirmenlaliryvihich acquires all or any
<br />pan of the estate or interest pursuant to a cunuatt of insurance or guaranty
<br />msunng or guarameeing the mdebtednes+ srcured by the insured mortgage.
<br />Ibl After Conveyance of Title. The ~ irverage of this policy shall continue
<br />in farce as of Date of Policy in favor of art nisured only so long as the insured
<br />retains an estate or interest in the land ni holds an indebtedness secured by a
<br />puri:hase money mortgage given by a piui:liaser Irom Ilic insured. or only so
<br />long as the insured shall have liability by reason of covrnanls of warranty made
<br />by the insured in any transfer or conveyance of the estate or interest. This polity
<br />shall not continue m force in favor of any purchaser from the insured of either Irl
<br />an estate or interest in the land, or (ii) an indebtedness :rcured by a purchase
<br />mor~ey ntongage given to the insured
<br />Id Amount of Ins : ~ ea a artsuranie a r the acquisition
<br />~r~-.~:.. fix-, ...
<br />of aher the cenveyance shall in aeitherevent exreed.tlie leas pG--a"`~
<br />lit the Amount of Insuiante'stat0d in Stlhed`ule A:?"~'
<br />(ii) the amount of the principal of the indebtedness secured al the
<br />insured mortgage as of Date of Polity, interest thereon, expenses of
<br />foreclosure, amounts advanced pursuant to the insured mortgage to assure
<br />compliance with laws or to protect the lien of the insured mortgage prior to the
<br />time al acquisition of the estate or interest in the land and secured thereby and
<br />reasonable amounts expended to prevent deterioration of improvements, but
<br />reduced by the amount of all payments made; or
<br />(iii( the amount paid by any governmental agency or governmental
<br />instrumentality, if the agency or instrumentality is the insured claimant, in the
<br />acquisition ul (lie estate or interest in satisfaction of its insurance contract or
<br />yuaranry.
<br />3. Notice of Claim to be Given by Insured Claimant
<br />The Insured shall notity the Company promptly in writing lrl in case of any
<br />litigation as set forth in Section 4(al below, (iii in case knowledge shall come
<br />to an insured hereunder of any claim of title or interest which is adverse to the
<br />title to the estate or interest or the lien of the insured mortgage, as insured,
<br />and wlnrh might cause loss or damage far which Ilse Company may 6e liable
<br />by value of this policy, or liiil it title to the estate or interest or the lien of the
<br />insured mortgage, as insured, is rejected as unma~~~^.iable If prompt notice
<br />shall not be given to the Company, then as Io the inswed all Iiahilily of the
<br />Conili~irty shall terminate with regard to the matter or matters for which prompt
<br />notice is requn ud. provided, however, that failure to nosily the Company shall
<br />In no case prejudice the rights el any insured under this policy unless the
<br />Company shall be prejudiced by the failure and then only to the extent of the
<br />prejudice.
<br />4. Defense and Prosecution of Actions: Duty ollnsured Claimant to
<br />Cooperate
<br />sal Upon written request 6y the insured and subject to the options
<br />contained in Section 6 of these Conditions and Stipulations, the Company at its
<br />own cost and without unreasonable delay. shall prnwde for the defense of an
<br />insured in IiugaGon m which any third party asserts a claim adverse to the role
<br />or interest as insured. but only as to those stated causes of action alleging a
<br />defect, lien or encumbrance or other matter insured against by [his policy the
<br />Company shall have the right to select counsel of its choice Isublect to the right
<br />of the insured to object for reasonable causes to represent the insured as to
<br />those stated causes of action and shall not be liable for and will not pay the
<br />fees of any other counsel The Company will not pay any lees, costs or
<br />expenses incu«ed by the insured in the defense of those causes of action which
<br />allege masters not insured against by this Dolicy.
<br />Ibl The Company shall have the right, at its own cost. to institute and
<br />prosecute any action or proceeding or to do any outer act which in its opinion
<br />may be necessary or desirable to establish the title to the estate or interest or
<br />the lien of the insured mortgage, as insured. or to prevent or reduce loss or
<br />damage to the insured The Company may take any appropriate action under the
<br />terms of this policy, whether or not it shall be liahle hereunder, and shall not
<br />thereby concede liability or waive any provision of this policy. II the Company
<br />shall exercise its rights under this paragraph, it shall do so diligently.
<br />Icl Whenever the Company shall have brought an action or interposed a
<br />defense as required or permitted by the provisions of this policy. the Company
<br />may pursue any In~gation to final determination by a coup of competem
<br />jurisdiction and expressly reserves the right. in its sole discretion. to appeal
<br />from any adverse lutlgment or order.
<br />Ids In all cases where this policy Oermits or requires the Company to
<br />prosecute or provide for the defense of any action or proceeding, the insured
<br />shall secure to the Company the right to so prosecute or provide defense in the
<br />action or proceeding, and all appeals (herein, and permit the Company to use. at
<br />its option, the name of the insured for lh~s purpose Whenever requested by the
<br />Company, the insured. at the Company's expense, shall give the Company all
<br />reasonable aid lit in any action or proceeding, securing evidence. obtaining
<br />witnesses, prosecuting or defending the acnon or proceeding, or etlecting
<br />settlement, and (iii in any other lawful an wh¢h in the opinion of the Company
<br />tCommued on mode back cover.l
<br />muu vpcw auowneu „tie ,uno,.,vry muu
<br />t~aonpw Ileys'sasuadxa pue Baal sAawoue
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