Investors Title Insurance v. Bair , 296 F. App'x 332 ( 2008 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 07-1688
INVESTORS TITLE INSURANCE COMPANY,
Plaintiff - Appellee,
v.
CAROLYN BAIR, a/k/a Carolyn Songer Austin,
Defendant - Appellant.
Appeal from the United States District Court for the District of
South Carolina, at Beaufort. Patrick Michael Duffy, District
Judge. (9:05-cv-1434-PMD)
Submitted: September 9, 2008 Decided: October 14, 2008
Before WILKINSON, MICHAEL, and SHEDD, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Robert E. Austin, Jr., ROBERT E. AUSTIN, JR. LAW OFFICES, Leesburg,
Florida; Mark Weston Hardee, MARK W. HARDEE LAW OFFICES, Columbia,
South Carolina, for Appellant. Robert P. Wood, ROGERS, TOWNSEND &
THOMAS, PC, Columbia, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Carolyn S. Bair appeals from the district court’s
declaratory judgment, entered after a bench trial, that an
exclusion in a title insurance policy Bair had with Investors Title
Insurance Company (“Investors”) (the “Policy”) applies to release
Investors from its obligation to defend Bair’s title to certain
real property located in Hilton Head, South Carolina in an
underlying lawsuit. She asserts error in the district court’s
finding that she had actual knowledge of the claim of Forest Beach
Owners Association at the time of issuance of the title Policy;
claims the district court failed properly to consider the
applicable Policy provisions; and contends the district court erred
in failing to recognize that the quit claim deed from Property
Research Holdings was a matter of public record at the time the
title Policy was issued. She further appeals the district court’s
denials of her motions filed pursuant to Fed. R. Civ. P. 59(e). We
affirm.
The factual background of this case is somewhat complex
and involved, and we dispense with a complete recitation of the
facts, as they are fully set forth in the district court’s findings
of fact and conclusions of law, and are well known to the parties.
On appeal from a bench trial, we may set aside the district court’s
findings of fact only if they are clearly erroneous, and we give
due regard to the opportunity of the district court to judge the
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credibility of the witnesses. Fed. R. Civ. P. 52(a); see also
Ellis v. Thornton, 530 F.3d 280, 286-87 (4th Cir. 2008). The trial
court, sitting as a trier of fact, has the duty to weigh evidence
and draw reasonable inferences and deductions from that evidence.
United States v. Bales, 813 F.2d 1289, 1293 (4th Cir. 1987). An
inquiry as to what a person knew at a given point in time is a
question of fact. Bose Corp. v. Consumers Union of U.S., Inc., 466
U.S. 485, 498 (1984).
We find without difficulty that the district court’s
findings, based upon its consideration of the pleadings, the public
records of Beaufort County, the arguments and briefs of counsel,
and the evidence offered at trial, that Bair was aware of the title
risk in the contested portion of the lot were amply supported by
the evidence. Specifically, evidence exists to support the
conclusions that Bair contrived to obtain title to a portion of the
insured premises by adverse possession, filed a quiet title lawsuit
that purposely failed to name important parties, and colluded with
a local businessman to obtain a quit claim deed covering the
property to the end of Avocet Street. Evidence was presented
during trial that Bair failed to disclose her knowledge of these
facts, or her possession of many documents reflective of these
dealings that were not part of the public record, to the closing
attorney, the agent for Investors.
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We will not disturb the district court’s determination
that Bair’s testimony that she did not have actual knowledge that
members of the Forest Beach community retained an easement across
the portion of her lot that was formerly Avocet Street was not
credible. This finding was based on Bair’s familiarity with the
law of easements (as evidenced by other lawsuits she had filed), a
letter she received from an attorney with whom she had consulted
warning her that the Forest Beach community might retain an
interest to that piece of property, and her husband’s admission
that he had superior knowledge of title issues on Hilton Head. The
district court’s determination that Bair knew that all Subdivision
No. 1 lot owners owned an easement across Avocet Street was
supported by the fact that she took by adverse possession the end
of Avocet Street, filed for judgment wherein she failed to name
members of the Forest Beach community as defendants, and then
obtained (for no consideration) a quit claim deed to the land from
the businessman with whom she had arranged obtaining the judgment.
Evidence further establishing Bair’s lack of credibility was the
fact that just two months after the closing, Bair, represented by
Austin, filed a brief in a lawsuit, in which they argued that the
streets of Hilton Head Beach Subdivision No. 2 were open to the
public, a position inconsistent with her position in this lawsuit.
The court’s conclusion that Austin, her attorney husband, had
“expertly orchestrated” the quiet title suit likewise is adequately
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supported by Austin’s testimony that he tried to keep the quiet
title suit “quiet,” that he purposely failed to determine the
identities of Bair’s neighbors to notify them, and that he
published the notice of the quiet title suit in a neighboring
town’s newspaper, rather than the primary paper dispensed in the
area. Moreover, Austin testified that Bair was fully aware of all
his actions taken on her behalf, and Bair testified that Austin
“would not hold anything back from [her].” The sum total of the
oral and documentary evidence amply supports the district court’s
factual determination that Bair had actual notice that Forest Beach
Owner’s Association would have had a claim on the subject
property.1
Nor do we find to have merit Bair’s assertion that the
district court failed properly to consider the applicable Policy
provisions, as the record demonstrates that the court carefully
reviewed the Policy at issue, and expressly considered the proper
legal standards for construction of insurance policies in rendering
its carefully considered decision. The district court correctly
applied South Carolina insurance contract law in holding that the
language of an exclusion, where ambiguous, will be resolved in
1
That determination, contrary to Bair’s contention, is
consistent with Spence v. Spence, 368 S.C. 106, 628 S.E.2d 869(2006), as Spence holds that “[a]ctual notice may be shown by
direct evidence or inferred from factual circumstances.” 368 S.C.
at 118, 628 S.E.2d at 875.
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favor of the insured and coverage,2 and determined that Investors
would be entitled to avoid payment under the Policy only if Bair
had actual knowledge of the title risk at issue.3 The district
court then analyzed the evidence before it and determined with ease
that Bair had actual knowledge that members of the Forest Beach
Community retained an easement across the contested portion of
Avocet Street in spite of the 1999 judgment purporting to quiet
title in Bair. We find no error in the district court’s
construction of the Policy provisions.
Bair further asserts that the district court failed to
consider that a quit claim deed from Property Research Holdings to
Forest Beach Homeowners Association, recorded on July 25, 2001, was
a matter of public record at the time the title Policy was issued,
such that the Policy exclusions should not apply. Our review of
the record reveals that the district court considered all the
evidence before it during the bench trial,4 and properly determined
that the title search conducted by Investors’ agent, in which she
found the 1999 judgment purporting to quiet title to the contested
property on Avocet Street, was properly limited to matters of
2
See, e.g., Helena Chemical Co. v. Allianz Underwriters Ins.
Co., 357 S.C. 631, 639, 594 S.E.2d 455, 459 (2004).
3
See New York Underwriters Ins. Co. v. Central Union Bank of
S. Carolina, 65 F.2d 738, 739 (4th Cir. 1933).
4
Appellee asserts that the quit claim deed referred to by Bair
was not included in the record until the Fed. R. Civ. P. 59(e)
stage of the case, a statement Bair does not dispute.
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public record, and that the agent was not required to consider
“local ordinances, the pleadings from the quiet-title action, or
other papers not recorded in the Office of the Registrar of Deed
[of Beaufort County] which may have impugned the legal
effectiveness of the 1999 judgment.” Investors Title Ins. Co. v.
Bair, No. 9:05-cv-1434-PMD (D.S.C. April. 27, 2007).
Bair raises a number of issues in her reply brief. To
the extent these issues were not raised in her opening brief, she
has waived consideration of them on appeal. See Yousefi v. INS,
260 F.3d 318, 326 (4th Cir. 2001).
Finally, we review for abuse of discretion the district
court’s denial of a Rule 59(e) motion. Temkin v. Frederick County
Comm’rs, 945 F.2d 716, 724 (4th Cir. 1991). We find that the
district court properly exercised its fact-finding function in
inferring from the plethora of direct evidence that Bair was aware
of the title risk relative to the contested portion of the
property. Even assuming, arguendo, that we were to determine that
there existed the reasonable inference from the evidence that Bair
was not aware of the risk, the factfinder’s choice that she was
aware cannot be clearly erroneous. See Anderson v. Bessemer City,
470 U.S. 564, 574 (1985). Given that the district court’s
determination that Bair had actual knowledge of the title risk was
factually supported by sufficient evidence and legally justified,
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we find no abuse of discretion in the district court’s denial of
Bair’s Rule 59(e) motions.
Accordingly, we affirm the district court’s declaratory
judgment and its denials of Bair’s Rule 59(e) motions. We dispense
with oral argument because the facts and legal contentions are
adequately presented in the materials before the court and argument
would not aid the decisional process.
AFFIRMED
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