Guideline: ALTA Endorsement 09.4 and 9.4-06 (Restrictions, Encroachments, Minerals-Unimproved Land; Owner's)

Explanation:

This endorsement to an Owner's Policy covering unimproved land insures against violations of restrictions, encroachments on the land from adjoining land, and damage by reason of mineral development. It is similar to ALTA Endorsement 9.1 and to other owner's comprehensive endorsements.

Endorsement 9.4 is issued with a 1992 ALTA Owner's Policy. Endorsement 9.4-06 is issued with a 2006 ALTA Owner's Policy.

Underwriting Requirements:

(1) Restrictions:

(a) Verify whether the restrictions create easements, options to purchase or rights of first refusal to purchase, or right of reentry, possibility of reverter or right of forfeiture because of violations. If any of these provisions appear in the restrictions, separately and explicitly except to those provisions in Schedule B. For example, separately except to "easement for ___ set forth in..." or "right of first refusal to purchase set forth in..."

(b) Verify whether the existing use, if any, materially violates the restrictions. If the use violates the restrictions, except to the violation in Schedule B.

(2) Encroachments:

(a) Unless local or national underwriting guidelines by the Company provide otherwise, require a survey. Except in Schedule B to any encroachments.

(b) If you do not require or otherwise receive a survey and our underwriting guidelines allow you to issue without a survey, you do not need to make any exceptions unless you actually know of encroachments.

(3) Minerals:

In order to provide the coverage of paragraph 2 because of development of minerals, comply with one of the following requirements:

(a) verify that there are no outstanding minerals (other than royalties) or that surface rights have been waived;

(b) on single family residential property within a platted subdivision and within municipal boundaries, you may provide the coverage even if there are outstanding minerals unless you know that the subdivision has actual mineral development;

(c) on land to be improved as an apartment complex and within municipal boundaries in a developed area, you may provide the coverage even if there are outstanding minerals unless you know that the immediate area has actual mineral development;

(d) on land to be improved as an office building or shopping center and within municipal boundaries in a developed area, you may provide the coverage even if there are outstanding minerals unless you know that the immediate area has actual mineral development;

(e) secure underwriter approval. Factors of relevance on other land include per cent of minerals outstanding, zoning prohibitions, waivers of surface rights, and development in the area.

If you cannot comply with these guidelines, delete paragraph 2 of the endorsement. The coverage of paragraph 2 may not be provided in Oklahoma. You may not provide this coverage in Florida or New Mexico if surface rights for mineral development of severed mineral interests have not been waived.

The underwriting guidelines contained herein have been provided for general reference. The facts, circumstances, and location of the subject property should be considered when determining the issuance of the requested form or endorsement. Please note that all of the forms and endorsements included in this system may not be available in all states. Accordingly, please contact the appropriate Stewart Title Guaranty Company underwriting personnel in order to determine availability.

Compliance with the underwriting guidelines contained herein in no way obligates Stewart Title Guaranty Company to issue any form or endorsement.