2018 | ISSUE 6
BIG SKY Review
~ A M O N TA N A A G E N C Y N E W S L E T T E R ~
AFFIDAVITS AND INDEMNITIES
Page In This Issue
The customer insists on modifying your standard form of affidavit and indemnity to add knowledge qualifiers or an automatic termination clause.
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What are affidavits and why do we require them? An affidavit is a document that contains a representation of facts, given under oath, of a person known as the “affiant.” The representations made in affidavits provide vital information, generally not available in the Public Records, upon which to base our underwriting decisions. Our standard forms include indemnification provisions by which an indemnitor, who may or may not be the affiant, agrees to indemnify (protect) First American against losses arising out of any false statements in the affidavit. This provides a direct contractual mechanism to recoup loss suffered by our reliance on the affidavit.
Affidavits and Indemnities
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Agent Advantage
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Safe Escrow
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Holiday Marketing Items
Knowledge qualifiers. The affiant should have personal knowledge of the facts stated in the affidavit, either because that person is knowledgeable about the day-to-day operations of the property or because he or she has consulted with someone who is. Without this knowledge, we cannot justifiably rely on the affidavit to provide coverage for off-record matters. When representations in the affidavit are limited “to the best of my knowledge”, “to my actual, current knowledge” or “ to the best of my knowledge with no duty to investigate”, it undermines the reliability of the representations and suggests that the affiant may not have the requisite knowledge to make a definitive representation. Are knowledge qualifiers acceptable? Generally, knowledge qualifiers are unacceptable. If the customer insists on knowledge qualifiers, you may agree to them only if you are confident that the representations in the affidavit are true. Consider the following in determining the reliability of the representations: (i) What is the requested knowledge qualifier? For example, in some states, “to the best of my knowledge” may be better than Continued on next page The information contained in this document was prepared by First American Title Insurance Company (“FATICO”) for informational purposes only and does not constitute legal advice. FATICO is not a law firm and this information is not intended to be legal advice. Readers should not act upon this without seeking advice from professional advisers. First American Title Insurance Company makes no express or implied warranty respecting the information presented and assumes no responsibility for errors or omissions. First American, the eagle logo, First American Title, and firstam.com are registered trademarks or trademarks of First American Financial Corporation and/or its affiliates. AMD: 12/2018
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