TITLE GUARANTEE COMPANIES, the name given to companies which =pp.:: nrincip„, of corporate indemnity to the protection of those interested in real estate titles. either as owners or lenders. They are of the class of indemnity companies in which technical skill and experience in stization of risks are relied upon to protect the guarantor from loss. They are peculiar to countries where the title to real estate is a matter of public record. and where the complexity of the record and the variety or possible liens and encumbrances have made it and expensive to determine whether the title is good. The only country where they have reached large proportions or achieved success as indepen business is the United States. In Australia no ration of a title to real estate is necessary. because before the land passed into individual ownership the government adopted a sys tem of state registration and zu.a.rantee of title. so that its certin cate of registered title was universally accepted. In certain other countries there is neither registration of title nor recording of deed.; the title-deet'= are ;reserved and passed from owner to owner, and are accented on the authority of the records and opin ions of family solicitors. In the United States. however. there have been from the a:ts providing that all deeds and be and the records. when properly made.
constitute legal notice to all the world of their conten:S clams.
At the time, there are other records of wills. sui:s. judg ments, taxes and mechanics' claims which may encumher the title. In the cities these various records cecante in course of time that the proper investigatstn of them, and the of the va'li'dity 0: the title in of them, re-quired the best skill of an experienced lawyer and involved very heavy expenses. On a re-sale of the ;rt;-erty the new buyer did not rely upon the 12.wyer who had 77_ a 7:e .l.e examination for the seller. but felt called upon to employ and pay his own lawyer. who had to go over the same work again, and more. f:r with each new trans action the histor,- was getting longer. Tne delay and expense involved were great, and yet the owner little or no protection. for a law3.-er is not held to guarantee the c-irre:tness of his opinion.
The first company actually to undertake the guarantee of real estate titles was formed in Phil'adelphia. Pennsylvania, in 1576. It differed from the Prussian Mortgage Insurar_:e company (which titles merely as an incident in its *Cusiness as a dealer in. and custodian and guarantor of mortgages, in that its main business was the of a on a transfer of title to land. The advantages of its method were immediately recognized. Corporations to carri on the :zuzir,,, were org.a ed in New York. Washingt.cn. Baltimore and and subse quently in nearly every considerable city in the Unite-: States.
In order to be independent of the inaccuri= le and clumsy moi ods of the public record Of:eS, title guarantee companies compile in their own offi:e a copy or digest of the sea'_ estate records of the locality in which they are for this purpose a staff of skilled clerks. To make the examination of a title prior to the of a they require continually a body of experien:e:: real estate layer. BY these means a title can be examined and in a whereas thirty or forty days was formerly required. This has done much to make real estate available capital, for individual and cor porate lenders on mortgage accept the guarantee of the companies as the best evidence of title, and loans can be had without the delay that once prevailed.
The expense of maintaining the staff of clerks and lawyers is great, amounting to half of the gross charges on titles guaranteed. Strictly speaking, the risks outstanding are also large, running up a year for a single company in New York city, but in well-managed companies the losses are very not ing of the gross charges on titles guaranteed, so that the out standing obligations should scarcely be called risks. In spite of the office expenses. the charges for first bringing a piece of land under the guarantee are no more than owners were in the habit of paying each time for examination and opinion by counsel, amounting to about one-half of I% on the value of the property or on the amount of the mortgage ; and when once the guarantee has been issued, it is re-issued on a subsequent sale or mortgage on short notice and for a small fee. (C. H. K.)