Court examines justifiable reliance in bankruptcy case

A title insurer filed an adversary complaint against a Chapter 11 debtor, seeking establishment, liquidation and allowance of a claim based on fraud and other theories, and a determination that the claim was nondischargeable. Calling it a “vexing problem,” the court weighed the debtor’s dishonesty against the title insurer’s responsibility for search and examination of title. Read on for the court’s determination.