Escrow Instructions... Get It In Writing.

By Thomas Rose | Tue, 16 Dec 2008

Don't underestimate the importance of written escrow instructions to a title company which relate to oil and gas mineral interests.  My clients obtained an owner's policy of title insurance which affirmatively represented that their residential property in Montgomery County was not encumbered by any rights to explore or produce oil and gas from their property. Then they purchased a subsequent owner's policy of title insurance from a different title insurance company (but from the same escrow agent/title company) after they built their home on the property to cover the costs of the improvements.

After living in their home for several years, they discovered that the surveyor and the title company both failed to discover and disclose to them that their new home was in the path of an access easement to a designated oil and gas drill site within the subdivision. Both title companies refused to honor their policies, a litigator was retained by my client, a lawsuit was filed, and ultimately both title companies finally struck a financial arrangement with the oil and gas operator, and the problem was resolved.