Fidelity National Title Insurance Company v. National Title Resources Corporation

National Title Resources Corporation (National) appeals the district court's2
grant of summary judgment in favor of Fidelity National Title Insurance Company
(Fidelity) in this breach of contract case. We affirm.

I.

Fidelity and National entered into an issuing agency agreement (agency
agreement) on July 1, 1994. By this agreement, National, a Minnesota based company,
issued title insurance policies underwritten by Fidelity, a New York corporation. The
agency agreement required National to maintain fiduciary funds in escrow accounts and
provided that either party could terminate the agreement without cause upon 30 days
notice or that Fidelity, in its sole discretion, could terminate the agreement at any time
in the event of default. The agency agreement defined events of default to include
deficiencies in National's trust accounts or its failure to perform any conditions or
obligations of the agreement. Fidelity discovered shortages in National's escrow
accounts, and as a result the parties entered into another agreement on March 29, 1995,
to address those shortages (March agreement). In the March agreement, National
admitted to defaulting under the agency agreement and agreed to secure a note payable
to Fidelity to reimburse the escrow shortages as well as to disclose bank account
records, turn over escrow-related banking responsibilities, and cooperate with
accounting and auditing procedures. On June 20, 1995, Fidelity terminated the agency
agreement with National, stating that National had not turned over all escrow-related
banking responsibilities and had not made up the escrow shortages.

Fidelity brought suit against National for breach of contract, negligence,
conversion, and breach of a personal guarantee. National counterclaimed for breach
of contract by Fidelity and for various torts. The jury found that National had breached the agency agreement and was negligent in its handling of three real estate transactions,
awarding damages of $233,781.11 and $208,867.77, respectively. The jury also found
that Fidelity had breached the agency agreement and awarded National damages in the
amount of $566,000 on its counterclaim. The district court granted Fidelity's motion
for new trial on the issues of whether Fidelity had breached the agency agreement when
it terminated National, and if so, what damages were sustained by National. The
district court vacated the $566,000 counterclaim judgment in favor of National. During
further discovery in preparation for the new trial, National announced that it would not
offer any new evidence on the issue of Fidelity's liability. Fidelity then filed a motion
for summary judgment, and the district court granted the motion and dismissed
National's counterclaim for breach of contract. National appeals.

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Click the case caption above for the full text of the
Court's opinion.

For the foregoing reasons, we affirm the judgment of the district court.

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Kent Morlan

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