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F I S C A L I M P A C T R E P O R T
SPONSOR Stewart
DATE TYPED 1/26/05
HB 33
SHORT TITLE Restore Title Search Duty of Reasonable Care
SB
ANALYST Rosen
APPROPRIATION
Appropriation Contained Estimated Additional Impact Recurring
or Non-Rec
Fund
Affected
FY05
FY06
FY05
FY06
NFI
NFI
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
Responses Received From
Public Regulation Commission (PRC)
New Mexico Land Title Insurance Association (NMLTA)
SUMMARY
Synopsis of Bill
House Bill 33 deletes language restricting liability only to underwriters of title insurance for rea-
sonable care in conducting title searches. House Bill 33 restores liability for reasonable care in
conducting title searches to both the underwriter and the agent.
Significant Issues
PRC indicates House Bill 33 reinstitutes the previous double liability situation for underwriters
and agents. PRC indicates title searches are conducted only for the benefit of the title insurance
underwriter and not the consumer; therefore, any defect in title or other actionable cause should
not create a cause of private action between a consumer and an agent.
OTHER SUBSTANTIVE ISSUES
NMLTA indicates 90% of New Mexico’s title insurance companies are small businesses that