R2006-189 AUTHORIZING PURCHASE OF REAL PROPERTY

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� � � � � � � CONDITIONS AND STIPULATIONS (Continued) 7. DETERMINATION,EXTENT OF LIABILITY AND COINSURANCE. (b) When liability and the extent of loss or damage has been definitely fixed This policy is a contract of indemnity against actual monetary loss or damage in accordance with these Conditions and Stipulations,the loss or damage shall be sustained or incurred by the insured claimant who has suffered loss or damage by payable within 30 days thereafter. reason of matters insured against by this policy and only to the extent herein 73. SUBROGATION UPON PAYMENT OR SETTLEMENT. described. (a) The Company's Right of Subrogation. (a) The liability of the Company under this policy shall not exceed the least Whenever the Company shall have settled and paid a claim under this policy, of: all right of subrogation shall vest in the Company unaffected by any act of the (i) the Amount of Insurance stated in Schedule A;or, insured claimant. (ii) the difference between the value of the insured estate or The Company shall be subrogated to and be entitled to all rights and remedies interest as insured and the value of the insured estate or interest subject to the Which the insured claimant would have had against any person or property in defect,lien or encumbrance insured against by this policy. respect to the claim had this policy not been issued. If requested by the Company, (b) In the event the Amount of Insurance stated in Schedule A at the Date of the insured claimant shall transfer to the Company all rights and remedies against Policy is less than 80 percent of the value of the insured estate or interest or the full any person or property necessary in order to perfect this right of subrogation.The consideration paid for the land, whichever is less, or if subsequent to the Date of �nsured claimant shall pertnit the Company to sue,compromise or settle in the name Policy an improvement is erected on the land which increases the value of the of the insured claimant and to use the name of the insured claimant in any insured estate or interest by at least 20 percent over the Amount of Insurance stated transaction or litigation involving these rights or remedies. in Schedule A,then this Policy is subject to the following: If a payment on account of a claim does not fully cover the loss of the insured (i) where no subsequent improvement has been made, as to any claimant, the Company shall be subrogated to these rights and remedies in the partial loss,the Company shall only pay the loss pro rata in the proportion that Proportion which the Company's payment bears to the whole amount of the loss. If loss should result from any act of the insured claimant,as stated above,that the amount of insurance at Date of Policy bears to the total value of the act shall not void this policy,but the Company,in that event,shall be required to pay insured estate or interest at Date of Policy; or only that part of any losses insured against by this policy which shall exceed the (ii) where a subsequent improvement has been made, as to any amount, if any, lost to the Company by reason of the impairment by the insured partial loss,the Company shall only pay the loss pro rata in the proportion that claimant of the Company's right of subrogation. 120 percent of the Amount of Insurance stated in Schedule A bears to the sum (b) The Company's Rights Against Non-insured Obligors. of the Amount of Insurance stated in Schedule A and the amount expended for The Company's right of subrogation against non-insured obligors shall exist the improvement. and shall include, without limitation, the rights of the insured to indemnities, The provisions of this paragraph shall not apply to costs,attorneys'fees and 9uaranties, other policies of insurance or bonds, notwithstanding any terms or expenses for which the Company is liable under this policy,and shall only apply to conditions contained in those instruments which provide for subrogation rights by that portion of any loss which exceeds,in the aggregate, 10 percent of the Amount reason of this policy. of Insurance stated in Schedule A. 14. ARBITRATION. (c) The Company will pay only those costs, attorneys'fees and expenses Unless prohibited by applicable law, either the Company or the insured may incurred in accordance with Section 4 of these Conditions and Stipulations. demand arbitration pursuant to the Title Insurance Arbitration Rules of the American 8. APPORTIONMENT. Arbitration Association. Arbitrable matters may include, but are not limited to,any If the land described in Schedule A consists of two or more parcels which are controversy or claim between the Company and the insured arising out of or relating not used as a single site, and a loss is established affecting one or more of the to this policy, any service of the Company in connection with its issuance or the parcels but not all,the loss shall be computed and settled on a pro rata basis as if breach of a policy provision or other obligation. All arbitrable matters when the the amount of insurance under this policy was divided pro rata as to the value on Amount of insurance is$1,000,000 or less shall be arbitrated at the option of either Date of Policy of each separate parcel to the whole,exclusive of any improvements the Company or Uie insured. Ail arbitrable matters when the Amount of Insurance is made subsequent to Date of Policy, unless a liability or value has othervvise been in excess of $1,000,000 shall be arbitrated only when agreed to by both the agreed upon as to each parcel by the Company and the insured at the time of the Company and the insured.Arbitration pursuant to this policy and under the Rules in issuance of this policy and shown by an express statement or by an endorsement effect on the date the demand for arbitration is made or,at the option of the insured, attached to this policy. the Rules in effect at Date of Policy shall be binding upon the parties.The award may include attorneys'fees only if the laws of the state in which the land is located 9. LIMITATION OF LIABILITY. pertnit a court to award attorneys'fees to a prevailing party. Judgment upon the (a) If the Company establishes the title,or removes the alleged defect, lien award rendered by the Arbitrator(s)may be entered in any court having jurisdiction or encumbrance,or cures the lack of a right of access to or from the land,or cures thereof. the claim of unmarketability of title,all as insured, in a reasonably diligent manner The law of the situs of the land shall apply to an arbitration under the Title by any method, including litigation and the completion of any appeals therefrom, it Insurance Arbitration Rules. shall have fully perfortned its obligations with respect to that matter and shall not be A copy of the Rules may be obtained from the Company upon request. liable for any loss or damage caused thereby. 15. LIABILITY LIMITED TO THIS POLICY;POLICY ENTIRE CONTRACT. (b) In the event of any litigation, including litigation by the Company or with �a) This policy together with all endorsements,'rf any,attached hereto by the the Company's consent,the Company shall have no Iiability for loss or damage until Company is the entire policy and contract between the insured and the Company. there has been a final determination by a court of competent jurisdiction, and In interpreting any provision of this policy,this policy shall be construed as a whole. disposition of all appeals therefrom,adverse to the title as insured. (b) Any claim of loss or damage,whether or not based on negligence,and (c) The Company shall not be liable for loss or damage to any insured for Which arises out of the status of the title to the estate or interest covered hereby or liability voluntarily assumed by the insured in settling any claim or suit without the by any action asserting such claim,shall be restricted to this policy. prior written consent of the Company. (c) No amendment of or endorsement to this policy can be made except by 10. REDUCTION OF INSURANCE; REDUCTION OR TERMINATION OF a writing endorsed hereon or attached hereto signed by either the President,a Vice LIABILITY. President,the Secretary,an Assistant Secretary,or validating officer or authorized All payments under this policy, except payments made for costs, attomeys' signatory of the Company. fees and expenses,shall reduce the amount of the insurance pro tanto. 16. SEVERABILITY. 11. LIABILITY NONCUMULATIVE. In the event any provision of the policy is held invalid or unenforceable under It is expressly understood that the amount of insurance under this policy shall applicable law,the policy shall be deemed not to include that provision and ail other be reduced b an amount the Com an ma a under an olic insurin a Provisions shall remain in full force and effect. Y Y P Y Y P Y Y P Y 9 mortgage to which exception is taken in Schedule B or to which the insured has 17. NOTICES,WHERE SENT. agreed, assumed, or taken subject,or which is hereafter executed by an insured All notices required to be given the Company and any statement in writing and which is a charge or lien on the estate or interest described or referred to�n required to be furnished the Company shall include the number of this policy Schedule A,and the amount so paid shall be deemed a payment under this policy to the insured owner. and shall be addressed to: Consumer Affairs Department, P.O. Box 27567, Richmond,Virginia 23261-7567. 12. PAYMENT OF LOSS. (a) No payment shall be made without producing this policy for endorsement of the payment unless the policy has been lost or destroyed,in which case proof of loss or destruction shall be furnished to the satisfaction of the Company.