ReportThe Title

Volume 15 No. 4 Spring 2008•

Contents

Page One

Page Two

Page Three

Page Four

Page Six

Page Seven

Page Eight

The Other Side of the Fence

Devereaux Cannon...The Oneand Only

Michael Davis Joins ORT

In the Footsteps of Greatness

Escrow AccountsIt Ain’t Your Money…..Part Two

Agency Reminders

Tennessee MutualIndemnification Agreement

We’re Here to Make it EZ

Save the Dates for 2008

Page Five

A publication of

National Title Insurance CompanyTennessee

201 Fourth Avenue NorthSuite 150

Nashville, TN 37219-2011Phone 615.244.2101

WATS 800.423.0258 (TN)Fax 615.726.0286

OLD REPUBLIC

The Other Side of the FenceWayne Trapp,

Well, here we are off to a new year. 2008 has started offwith sadness in the Old Republic Title family as we lostour beloved Devereaux Cannon. Although he will alwaysbe missed he will also be fondly remembered by one andall. I truly believe with all my heart that Devereaux islooking down on us and is proud of the fact that we aremoving forward. He will always be walking with us. A littletribute is inside this edition.

On to more items that make this article what it is: silly. Due to printing time, I'm writing thison Wednesday, January 30th, so think back a little. Did it rain and storm at ya'll's house lastnight? Man, it did at mine. It didn't last but maybe 10 minutes, but it rained like pouring it outof a boot and the wind blew limbs everywhere. I'll leave a little early today so as to gethome before dark to see if my cows are still home. For all I know, a tree may have beenblown across a fence and every one of them are in Cookeville by now, who knows.

The calving season will start any time after February 10th which is just a couple of weeksfrom now. This weekend one of my buddies “big Ray” is coming up to eat breakfast with me(country ham, sausage, eggs, biscuits and gravy) and then we are moving the cows to aclean pasture to calve in. None of my other buddies can make it. Frankie will be working theconstruction expo at the fairgrounds in Lebanon, Wormy has to check on his dad who ishaving surgery and Tim just won't do it. He would probably get hurt anyway, so it's best hestays away. I've made a change in my cattle and have started a cross breed programwhere my Angus cows are bred to a Hereford bull. This gives a Black Baldie calf. It's just aname that means a black cow with a white face. They are really pretty and look like a pandabear. They grow really well and make great beef.

My diet is back on track (except for breakfast with “big Ray”). As of Monday morning, I'mdrinking a can of Slim Fast for breakfast and lunch then some sort of light supper. Have youever had the Lean Cuisine pizza or lasagna? Both are really good, just try to eat one boxinstead of two. I had the roasted vegetable pizza Monday night. It only has 230 calories andyes, with only 230 calories I ate two of them, but still only had a total of 840 calories for theday. Think of me every time you eat a Snickers or Peanut M & M's because they are myfavorites, just on the bad list right now.

Well, enough of the foolishness. Although my article is light, it's for a reason. It's a reminderto enjoy every day. If just one person reads this and maybe realizes the need to have morefun or to give the kids a little more time, or a hug, or maybe to call your mama, then it'sworth it.

Come see us; the door is always open. See you next time…..on the other side of the fence.

Vice President and State Manager

OLD REPUBLICNational Title Insurance Company

OR

ReportThe Title

DEVEREAUX CANNON…….THE ONE AND ONLYWayne Trapp, Vice President and State Manager

2

By now everyone has heard the horrible news ofDevereaux's untimely death. The title industry has losta very unique person. We at Old Republic Title havenot only lost a co-worker, we have lost a friend.Youngattorneys and title agents have lost a mentor,someone that never failed to help the person on theother end of the phone.He always took time tolisten to the completequestion before giving ananswer and then it wasclear, and sometimeswith humor. I've hadpeople say that not onlywould Devereaux tellthem how to dosomething he would alsotell them why we need todo it a certain way.

Devereaux and I workedtogether for over 20years and I can truly sayhe always carried himselfas a gentleman. Heloved the title industry, itspeople and Old RepublicTitle. He had talked withme many times abouthow happy he was to beworking for our company.More than anythingDevereaux loved his family. He always had pictures toshow us whether they were of his daughter's birthdayor his son's military adventures. His priorities weredefinitely in order.

I must tell a story. Not being one for fancy clothes(“duds” as he called them), he bought a custom-madeTom James suit right before Christmas. He was sohappy about it, he came in to me one morning andsaid “Wayneo, I'm gonna be so pretty and you're

gonna be so proud of me, I just bought a new suit andwill wear it to our Christmas dinner.” He did just that.The suit came in and he wore it to our dinner. Ofcourse, he had to go around and show himself offwearing that suit. He said it cost so much that hewould be buried in it, and he was. He didn't have to

have a custom made suitfor me to be proud ofhim. I was proud to beassociated with himbecause of who he was,what he stood for andwhat he has left behindfor all of us to remember.

There will never beanother Devereaux. Themold was thrown away. Iknow he would not wantus to sit around andmoan and groan becausehe is not with us. Guesswhat? He is still with usas his memory and spiritlives within each of usfortunate enough to haveknown him.

What a man, so happy,so loving, so helpful andso bright.You will bethought of daily and

remembered forever. Rest well my friend.

“We are remembered not bywhat we have, but by what we

leave behind.”

ReportThe Title3

MICHAEL DAVIS JOINS ORTWayne Trapp, Vice President and State Manager

It is my pleasure to welcome Michael P. Davis to the OldRepublic Title family. He is assuming the duties of ClaimsCounsel yet is also available to take underwritingquestions.

Upon graduation from Belmont University, Mike enrolledat the Nashville School of Law where he received hisJ.D. in 1989. For the past 18 years, Mike practiced law inGoodlettsville, Tennessee, where in 1996 he openedFrontier Title and Escrow, which was an exclusive agentfor Old Republic Title. He has also presented varioustitle-related seminars with Devereaux Cannon and Kirk

Moser. Mike's experience makes him a great fit for OldRepublic Title and its agents.

This newest addition to our team continues our focus ona strong legal department, one that will continue to workhard for you and to give the best service possible.

Please join me in welcoming Mike aboard. He can bereached by calling our office here in Nashville at (615)244-2101/(800) 423-0258 or by email atmdavis2@oldrepublictitle.com.

IN THE FOOTSTEPS OF GREATNESSMichael P. Davis, Assistant Vice President and Claims Counsel

It was a cool Saturday evening in December. I had juststepped outside my front door when my phone rang. Ianswered to hear Wayne say “Are you sitting down?”After a short pause, he told me that Devereaux hadpassed. For the first few moments I just stood in shock;it was hard to believe the man who I, and everyone elseassociated with the title industry in Tennessee, admiredand respected as the greatest mind in the industry wasgone. The next several days I found myself constantlythinking about what a great friend and mentor I had lostand having the feeling of this large void in my life. Afterall, it was Devereaux who had taken me under his wingand made sure I could survive.

About twelve years ago, I found myself exploring thepossibility of opening a title agency. Being familiar withthe industry and having spent a better part of thebeginning of my law career searching titles as a law clerkand closing loans as an attorney, I knew just enoughabout the industry to be dangerous. One thing I didknow was I needed an underwriter. So one day Igrabbed the telephone book and made the call to OldRepublic. A short time later Wayne and Bill Bozemanwere sitting in my office in Goodlettsville signing me asan agent.

Soon after becoming an agent, the title questions startedarising and I found myself reaching for help. Within a

short period of time I began to develop a comfort levelwith Devereaux. The one thing I quickly learned was thatDevereaux was there for me. Devereaux truly caredabout me as an agent, but more importantly he trulycared about me as a person. There was never a timethat you could not give him a call and find yourselfengaged in an intriguing conversation involving anythingfrom politics to how the apple of his eye, Kate, waslearning to shoot a rifle. We are all going to miss thoseconversations and we are certainly going to miss thewisdom that was passed along to us through thoseconversations. I am sure many of you, just as I, feel asthough you are a better person from having had theopportunity to study and learn from such a wise man.

If it wasn't for Devereaux, I would not be writing thisarticle as Claims Counsel. My education in this industryhas come at the feet of the master. This is truly a manthat I respected and valued as a great friend. This is aman who called one day and asked a novice to help himpresent a seminar. This is a great man who went out ofhis way to help you make a deal work. This was a greatman who truly showed respect for everyone he dealtwith.

This was a MAN OF GREATNESS who will be missed byall. We can only hope to follow in his FOOTSTEPS.

ReportThe Title4

ESCROW ACCOUNTSIT AIN'T YOUR MONEY…..PART TWO

Wayne Trapp, Vice President and State Manager

Just about a year and a half ago I wrote an articleentitled “ESCROW ACCOUNTS..IT AIN'T YOURMONEY”. To this day comments are still made aboutthat article; enough so that I thought maybe it was timeto do a follow up.

As business has taken a downward turn, things arepopping up that just don't look good gang, I'm tellin' you.For years underwriters have yelled and screamed thatescrow accounts are to be reconciled on a monthlybasis. Good gracious, back when I was doing agencywork starting in the mid 70's, underwriters were harpingon keeping escrow accounts reconciled. It's even in theagency contract as one of the items agents agree to do.At one time, the thing that was put on the back burnerwas issuing policies and reporting them to theunderwriter. Now it seems that reconciling the escrowaccount has taken a back seat. I need to makesomething clear before going any farther. We don'tcontinue to harp on this subject because we thinkeverybody is stealing money, but because we don't wantto see an agent go down the tubes due to a bank error(you only have thirty days to notify them of an error theymade) or an error that was made by not voiding a checkor maybe making a payoff twice, etc.

Right here in Tennessee (home of Rocky Top and theVolunteers) we are hearing of big losses due to agentsnot reconciling their escrow accounts. In some cases ithas been years since the account was reconciled andwithout the float, checks are bouncing. Some are leapingover tall buildings in a single bound. Agents are having tofund from their own pockets because of bank errors.Thirty days pass and the bank says, “Sorry Charlie, youdidn't notify us within the allotted time frame.” If theaccounts had been reconciled, the errors could havebeen found. The bank would have been notified and theagent would have saved a lot of money.

Here's a scenario to think about. Underwriter audits oneof their larger agents and everything is fine. Never hasbeen a problem so the underwriter puts this agent on athree year rotation. Business gets really good. I mean

smokin' and blowin' good. Pulling out your hair, ill as ahornet good. Finish up one closing and jump right toanother one. Making money hand over fist, moreemployees than ever. Oh no, things slow down; closingsdrop from 100 per month to 20 per month. There is nomore large float and all of a sudden a realtor'scommission check bounces. The underwriter gets a calland does an audit. They find that this really great agenthad not reconciled their escrow account since the lastaudit two years ago because they were too busy.Underwriter finds a shortage of $400,000.00 but can'tfind where anybody took the money. What they do find isthat a payoff check for $125,000.00 was cut for$225,000.00 and a deposit of $145,000.00 was creditedto their account as $45,000.00 and another deposit of$750,000.00 was credited as $75,000.00. Checks cut forthe wrong amounts were many. Very sloppy accountingon the agent's part. The Agent doesn't have $400,000.00lying around to make good on the shortage so theyborrow against their house. Underwriter cancels theagency contract due to non-reconciling of escrowaccounts. Word gets around (although untrue) that theagent stole $4,000,000.00. The agency goes out ofbusiness because they can't find another underwriter.

Scenario #2. An agent goes out of business because ofan escrow shortage and comments are made: Howcould they have been that short in the escrow account?Didn't their underwriter do an audit? Well, yeah, an auditwas done and a shortage found. Agent was told toreconcile and a follow up audit would be conductedwithin a timeframe agreed upon by everybody. When thefollow up audit time rolled around guess what? A phonecall to the auditor saying “We are so busy. Can we putthis off until next month?” Okay, let's put it off for anothermonth. Agent promises to have everything together. Newaudit date rolls around and the escrow account isn'treconciled to date as promised. When asked about thisthe agent gets upset with the auditor and says things like“I'm not stealing any money,” or “I know how muchmoney goes in and out of that account.” Agentterminates the contract with their current underwriter andmakes application for a new underwriter. The new

continued on page 5

ReportThe Title5

underwriter has to do a pre-signing audit. In doing sothey find a shortage of $30,000.00 due to file shortagesdating back a year or so. Most of the shortages are dueto bank errors that are over thirty days old and the agentmust come up with $30,000.00 out of their pocket. Thiscould have been avoided if only the account had beenreconciled monthly. The agent is turned down by the newunderwriter due to an escrow shortage. Their oldunderwriter won't take them back and rumors startspreading like wildfire that somebody stole $300,000.00from the escrow account and bought a new tractor.

In both scenarios nobody took any money and theagents knew how much went in and how much wassupposed to go out, but without reconciling, everythingwas lost. If only monthly reconciliations had been done,everything would have been fine. The bad thing is thatthe agent in scenario #2 really didn't get the new tractor;it was only rumored.

If you don't have time to reconcile your accounts yourselfplease hire an outside source to do it for you. For theprice of a couple of closing fees (or maybe less), you canhave this done monthly. The time saved will allow youand your staff to work on other things, like maybe anadditional closing or two. We can put you in contact witha couple of sources that do only title agents' escrowaccount reconciliations. Just give us a call; we are hereto help. Underwriters aren’t trying to make your job moredifficult; in fact, we are trying to make our partnershipstronger by helping everybody stay out of trouble.

Note: The above scenarios are fiction and used only toshow what could happen if escrow accounts aren'treconciled properly.

ESCROW ACCOUNTSIT AIN'T YOUR MONEY…..PART TWO, cont.

AGENCY REMINDERSValerie Matlock-Perry, Assistant Vice President and Agency Manager

56-35-119. Rebates prohibited.

I know that all of you are familiar with the above Statute,but you might be surprised at how many times we areasked if it is okay to give a gas card or gift card for arestaurant to a broker/agent, etc. Sometimes it seemsthat because the line can be construed as a gray one, itwould be okay to offer these sorts of things.

I hope I'm clear when I say that it is not okay to givethese sorts of things. If there is any doubt whatsoever,the best thing to do is give us a call and ask. One phonecall could make all the difference in the world. It couldnot only save your reputation when it comes to kickbacksand/or incentives for business, but it could save yourrelationship with Old Republic.

Also, keep in mind that you must charge the filed ratesfor title insurance. You cannot give a discount on a titleinsurance premium, unless it is eligible for reissue creditper our rate filing.

Please remember that we want to help you and protectyou and that we value our relationships with each andevery one of our agents.

(a) It is unlawful for any applicant for a policy of titleinsurance, or any person, firm or corporation, onbehalf of any such applicant, or any other person, firmor corporation whomsoever, to request, receive orobtain from a title insurance agent, or a title insurancecompany, any commission, discount, rebate, specialfavor, advantage or inducement, or to engage orparticipate in any collusion with respect thereto, or forany title insurance company, or agent, to give, grant orrebate any part of a premium for title insurance to anylender, mortgage broker or real estate agent or brokeror real estate builder or developer, and no person shallengage in business as a title insurance agent in thisstate, nor accept or hold a certificate of agency for thechief and primary purpose of securing some specialadvantage, rebates, commissions or concessions ontitle insurance written for such person, or someperson, firm, corporation or lending institution in whichsuch person is interested, or with which such person isconnected or associated, and all of which acts andthings are expressly prohibited and forbidden by thischapter.

(b) Nothing in this chapter shall be construed to makeunlawful the distribution of profits or dividends to theowner or owners or shareholders of a title insurance

company, agency, or agent; provided, that suchdistribution is made in the ordinary course of businessand in accordance with sound accounting principles.

ReportThe Title6

TENNESSEE MUTUAL INDEMNIFICATION AGREEMENTR. Kirkland Moser, Assistant Vice President and State Counsel

The Mutual Indemnification Agreement (MIA) is anagreement between certain title insurance underwritersin Tennessee to automatically indemnify each other forcertain title defects, so long as it reasonably appears thatthe Indemnitor previously has issued an owner’s titlepolicy to the current title holder or a mortgagee titlepolicy to a lender who subsequently has acquired theinsured land and is the seller in the current transaction.The previous policy must cover some or all of the landinsured under Indemnitee’s Policy without exception tothe potential defects, subject, however, to the terms,provisions, and conditions of the MIA. Many of you arefamiliar with the MIA provisions, but you may not knowthat there have been some additional signers over thepast few year. The following is a brief summary of theprovisions and the signers.

The following is a summary of the general requirementsand matters automatically covered by the MIA:

I. Must retain for your files at least one of the following:a) Owner's Policy at least one (1) year old insuringthe seller or mortgagor in the current transaction; orb) Mortgagee Policy at least one (1) year old insuringa lender who has taken title to some or all of thecovered land insured under the policy.

II. Matters covered automatically by the MIA:a) Conveyances of a possible homestead withoutjoinder of a spouse if the grantor was married;b) Liens arising from money judgments (but not acertificate of delinquency for child support) andfederal or state tax liens up to a face amount of$250,000.00;c) Unsatisfied mortgages securing on their face nomore than $250,000.00, so long as it does notsecure revolving credit or equity lines of credit;d) Lack of guardians or attorneys ad litem torepresent an absent defendant or deficiencies in, orabsence of, a diligent search affidavit (when requiredby law) in any judicial proceeding (“The Case”)which results in a final, unappealable judgmentaffecting the title to the property;e) Lack of or insufficient notice of record of theauthority of an attorney-in-fact or trustee to make aprior conveyance to the seller or mortgagor in thecurrent transaction so long as the Indemnitor's policyinsuring the title without exception is at least one (1)

year old;f) Lack of evidence as to the authority of anindependent executor/executrix or independentadministrator/adminstratrix to convey title to the landto the current insured owner or a predecessor in title.

III. General Conditions of coverage:a) The Indemnitor's policy must be at least one (l)year old and contain no exception for the subject titleobjection listed above;b) There must be no record notice of any proceedingto enforce the judgment, tax lien, or mortgage;c) There must be no record notice of any proceedingto attack or set aside the title resulting from the Caseor the conveyance referenced in items II(d) or (e)above;d) The amount of the automatic indemnity is limitedto the face amount of the Indemnitor's policy or$250,000.00, whichever is less:e) This indemnity is limited to policies issued onTennessee properties only; andf) An Indemnitor is the underwriter who has alreadyissued its policy without exception to the coveredmatter. An Indemnitee is an underwriter whosepolicy is issued in reliance upon the automaticindemnities given in the MIA.

The following is a list of the Title Insurance underwriterswho have signed the MIA:

a) Lawyers Title Insurance Companyb) Old Republic National Title Insurance Companyc) Southern Title Insurance Corporationd) Stewart Title Guaranty Companye) Commonwealth Land Title Insurance Companyf) First American Title Insurance Companyg) Fidelity National Title Insurance Companyh) Chicago Title Insurance Companyi) Security Union Title Insurance Companyj) Censtar Title Insurance Companyk) Ticor Title Insurance Company.

If you have any questions regarding the use of theMutual Indemnification Agreement (MIA), please contactus. Furthermore, if you need a copy of the MIA, let usknow and we will be happy to send you a copy.

ReportThe Title7

WE’RE HERE TO MAKE IT “EZ” . . . . !ezJacket/ezRemit Program Now Available to Tennessee Agents

Pamela L. Zimmerman, Assistant Vice President and Agency Manager

Old Republic Title's ezJacket/ezRemit program is nowavailable to Tennessee agents. This new user-friendlysystem enables agents to generate policy jackets via aninteractive website accessible through StarsLink, ourpassword protected agent services website.

Each policy is issued a unique individual number with thestandard ALTA 2006 policy language on the jacket. Agentsimplementing the program will continue to use theirindividual software systems for generating specific policyschedules, adding the policy number issued through theezJacket generator.

This new program provides speed and flexibility sincejackets can be accessed anytime, anywhere. Jackets areprepared and tracked through the system, whichautomatically calculates both the gross premium collectedand amount due to Old Republic, including any applicableendorsement premiums. This provides another excellentcheck and balance to ensure that premium calculations arecorrect and to confirm remittance amounts beforetransmitting to Old Republic.

The ezJacket/ezRemit system eliminates the need ofkeeping up with and accounting for paper jackets, using tearstrips, or making notes on the policy reporting copy re:premium calculation information, as each unique policynumber and related premium is captured in the systemwhen the jacket is generated. Agents can view jacketnumbers generated, both reported and unreported, viaavailable online reports which can be printed as well.

The program's ezRemit function enables agents to remitstatistical policy information in one “ez” step, creating arecord of each remittance electronically. Upon submittingan ezRemit report electronically, premium payment shouldbe sent simultaneously to Phillip Brizendine, AgencyCoordinator, in our state office. As we continue to build our

online S-Plant (search back titles) database, we requestthat agents send paper policy copies (schedules only) withthe premium remittance.

To review details of the system, log into the StarsLinkwebsite: www.starslink.com (give Valerie or myself a call ifyou've forgotten your user name or password!); click on theAgent Services menu; click on ezJacket/ezRemit. Once theregistration page appears, click on the User Guide link nearthe bottom of the screen to access information re:registration and use of the jacket generator and remitfunctions. If you choose to register, complete any requiredset up fields and click on the “OK” button to submit therequest. Authorization will be approved through our stateoffice and you will receive an e-mail with an activation link togain access to the program.

As agents transition to ezJacket/ezRemit, it is important thatpolicy schedule copies with ezJacket numbers be submittedseparately from policy schedule copies with numbers frompre-printed paper jackets. Once agents who choose to usethe program are fully transitioned, unused paper jacketinventory will be accounted for and picked up/returned forcancellation.

We encourage each agent to take a minute and review theezJacket/ezRemit information and seriously consider itsuse. While it may not appeal to every agent, we are suremany agents will find it useful and efficient. For those ofyou who choose not to implement the program, Phillip hasdeveloped an EXCEL spreadsheet for use in reportingwhich should make your remittance process “ez”er as well!Give him a call if you'd like to receive the spreadsheet.

Remember, we're always here to help, so feel free to givePhillip, Valerie or myself a call to let us know how we canmake it “ez”er for you!!!

Pam Zimmerman

Assistant Vice President & Agency Manager

As a real-estate professional, you want to help your customers throughout thepurchase and settlement process. You want to ensure no property dispute willjeopardize their single largest family investment. Old Republic title offers a hostof efficient services via innovative technology designed to simplify your task. Wetake care of you, so you can take care of your customers. That’s Old Republictitle.

Tennessee State OperationsWayne Trapp, Vice President & Tennessee State Manager201 Fourth Avenue North, Suite 150Nashville, Tennessee 37219(615) 244-2101(800) 423-0258 TN

Pam Zimmerman, Assistant Vice President & Agency ManagerValerie Matlock-Perry, Assistant Vice President & Agency Manager

Visit us online at www.oldrepublictitle.com

Still the highest rated.

OLD REPUBLICNational Title Insurance Company

OR

SAVE THE DATES FOR 2008

: Solving the Mysteries

Registration materials for these half-day seminars focusing on ALTA 2006 policy forms, expanded coverageresidential owner's and loan policies, commitment and policy preparation, and on-line research tools will be mailedto agents located in the surrounding areas approximately one month prior to the seminar date, but we know you'llwant to mark your calendars now! If you're not able to attend the seminar on the date scheduled in your area,please feel free to let either Pam Zimmerman or Valerie Perry know if you'd like to be included in notification for oneof the other locations. A registration fee of $25.00 will be charged. Approval for three hours of CLE and CE creditwill be requested and is anticipated.

Friday, August 15

Registration materials for our full day 2008 Annual Agent Seminar (tentative topics include: Forms Associated withthe Closing Process and Clearing Title, Case Law and Legislative Updates, Claims, Identity Theft, Condos andManufactured Housing, and Managing the Workplace During Downtime and Fostering an Ethical Workplace) will bemailed to agents in the summer. A registration fee of $75.00 for attorneys and $50.00 for non-attorneys will becharged. Approval for six hours of CLE and CE credit will be requested and is anticipated.

Wednesday, October 9

Make plans to join us for our Annual Golf Tournament and cookout! While you won't get any CLE or CE credits,you're sure to have great fun! Registration materials for the golf tournament will be mailed in the late summer.

Knoxville Wednesday, May 7 Chattanooga Wednesday, November 5 Nashville Wednesday, December 3

Nashville - DoubleTree Hotel

Mt. Juliet - Windtree Golf Course

- • - • -

•

•

PRSRT STD

U.S. POSTAGE

PAIDLEBANON, TN

PERMIT#112

OLD REPUBLICNational Title Insurance Company

OR

201 Fourth Avenue North Suite 150Nashville, TN 37219-2011

•