Lawyers Title Insurance Corp. v. Baik, 147 Wash. 2d 536

Summary

The Washington Supreme Court considers whether a title insurer could pursue negligent misrepresentation claims against a law firm and attorneys who represented an estate and stated that no estate taxes were due. The court holds that a negligently obtained or communicated opinion may constitute false information, and that the defendants’ professional role and circumstances could support a duty of care. It reverses summary dismissal because the reasonableness of the title insurer’s reliance was a question for the trier of fact.

Holdings

1. A negligently obtained or communicated opinion may constitute false information under Restatement (Second) of Torts § 552; the defendants were not entitled to summary judgment on that element.
2. The law firm and its attorneys were not entitled to judgment as a matter of law on the duty element because the letter was supplied in the course of their profession, reflected a pecuniary interest, and was directed to a known business use.
3. Whether Lawyers Title reasonably relied on the law firm's letter was a question for the jury, not an issue resolvable on summary judgment.
4. Restatement (Second) of Torts § 552A does not bar negligent misrepresentation claims in Washington; a plaintiff need not be entirely free from fault to establish justifiable reliance, although comparative fault may reduce damages.

Questions Presented

1. Whether the law firm's letter could constitute false information for purposes of a negligent misrepresentation claim even though it accurately stated the firm's opinion based on its tax preparation.
2. Whether the law firm and its attorneys owed Lawyers Title a duty of care under Restatement (Second) of Torts § 552.
3. Whether Lawyers Title's reliance on the law firm's letter was unjustifiable as a matter of law.
4. Whether Restatement (Second) of Torts § 552A's contributory-negligence bar applies to negligent misrepresentation claims in Washington.

Disposition

reversed_and_remanded