A recent Washington Supreme Court opinion, Edmonson vs. Popchoi, provides some clarification and guidance for those of us who practice Washington Real Estate Law. The decision clarifies the duty of the grantor of a statutory warranty deed to defend against another's claim of title.
In Washington State, a good amount of title to property is conveyed pursuant to the statutory warranty deed. Statutory warranty deeds are governed by RCW 64.04.030. A statutory warranty deed sets forth several covenants including a covenant/warranty to defend the title conveyed against any and all persons who make claim against the title.
The Supreme Court in Edmonson held that the warranty to defend pursuant to a statutory warranty deed means that the grantor of a statutory warranty deed is obligated to defend in good faith against another's claim to title. The Court further held that this duty to defend is breached by the grantor's independent decision to settle and concede the claim without evident consideration of the merits of claim.
This decision provides some substantial guidance in relation to the use of statuory warranty deeds and the duties associated with statutory warranty deeds in Washington. If tendered the defense of a claim to title, the grantor of a statutory warranty deed must evaluate the claim in good faith and should include the grantee in decisions relating to the defense of the claim, including settlement. This can avoid a breach of the duty to defend.
