St. Paul Title Ins. Corp. v. Owen

Albert Owen conveyed property to his brother James and sister-in-law Cheryl by a deed with express covenants of seisin, right to convey, quiet enjoyment, warranty, and freedom from encumbrances. James and Cheryl later conveyed the property to Carlisle using only "grant, bargain, sell, and convey" language without expressly repeating those covenants. Carlisle mortgaged the property to GECC Financial Services, and St. Paul Title Insurance Company (plaintiff) insured the title; when Carlisle defaulted, GECC found it could not foreclose because a court determined Carlisle never actually owned the property, since Albert never had good title to convey. GECC recovered from St. Paul under its title policy, and St. Paul then sued Albert, James, and Cheryl (defendants) for breach of the title covenants in their respective deeds; the trial court ruled for the defendants, and St. Paul appealed.