Insured purchasers of real property brought action against title insurer, alleging breach of contract based on insurer’s refusal to defend insureds against city’s pre-existing lawsuit against vendors regarding alleged local zoning ordinance violations related to barn built by vendors.
The Circuit Court granted partial summary judgment in favor of insurer. Insureds appealed.
On transfer from the Court of Appeals, the Supreme Court held that:
- Trial court did not abuse its discretion in finding that partial summary judgment in favor of insurer was final for purposes of appeal;
- Insurer’s actual notice of city’s lawsuit did not trigger coverage under policy section providing coverage if notice was recorded in public records setting forth violation or intention to enforce building or zoning law, ordinance, permit, or governmental regulation;
- City’s lawsuit did not constitute “public record” within meaning of same coverage provision; and
- Policy exclusion for loss from any ordinance restricting, regulating, prohibiting, or relating to land use or character, dimensions, or location of any improvement on land unless claim met requirements of same coverage provision applied.