## Facts

- Albert M. Owen executed and recorded an express warranty deed conveying Baldwin County, Alabama property to James R. Owen, Jr. and Cheryl C. Owen, with covenants including seisin, right to convey, freedom from encumbrances, quiet enjoyment, and general warranty to “heirs and assigns.”
- James and Cheryl conveyed the property to Dennis C. Carlisle, Jr. by statutory warranty deed using “grant, bargain, sell and convey,” without additional express covenants.
- Carlisle mortgaged the property, later giving a mortgage to GECC Financial Services; a title insurance policy insuring GECC was issued by an agent for St. Paul Title Insurance Corporation.
- After Carlisle defaulted, GECC attempted to foreclose, but a circuit court ruled Carlisle had no right, title, or interest when the GECC mortgage was executed, defeating foreclosure.
- GECC recovered under the title policy; St. Paul paid and, as GECC’s subrogee, sued Albert, James, and Cheryl for breach of covenants of title in the deeds.
- The conveyances in the chain were intrafamily transfers for no consideration.
- The trial court entered judgment for all defendants; St. Paul appealed.

## Issues

1. Whether the covenants of quiet enjoyment and general warranty in Albert’s express warranty deed ran with the land and were breached so as to be enforceable by a remote mortgagee/assignee and its subrogee.
2. Whether James and Cheryl breached any implied covenants arising from their statutory warranty deed.
3. If a breach was established, what damages were recoverable where the conveyances involved no consideration.

## Decision

- Reversed in part, affirmed in part, and remanded.
- Albert was liable for breach of the running covenants of quiet enjoyment and general warranty, triggered by constructive eviction through an adverse judicial determination of title.
- James and Cheryl were not liable because the implied covenants in their statutory warranty deed extended only to their own acts and did not cover pre-existing title defects.
- St. Paul’s recovery against Albert was limited to nominal damages due to the absence of consideration in the conveyances.

## Legal Principles

- Covenants of quiet enjoyment and general warranty are future covenants that run with the land and may be enforced by remote grantees, assignees, and those standing in their rights.
- A future covenant is breached upon eviction; an adverse court decree denying the covenantee’s title may constitute constructive eviction.
- In a statutory warranty deed, language such as “grant, bargain, sell and convey” implies limited covenants protecting only against title impairments caused or suffered by the grantor, not against defects predating the grantor’s ownership.
- A subrogee’s claim is derivative and cannot exceed the rights and remedies of the subrogor.
- Where no consideration was paid in the conveyances, damages for breach of covenant of title may be limited to nominal damages.

## Conclusion

The court held that the original grantor’s express covenants of warranty and quiet enjoyment ran with the land and were breached by constructive eviction when title failed, but limited recovery to nominal damages because the transfers were gratuitous, and it rejected liability for intermediate grantors who conveyed by statutory warranty deed without having caused the title defect.


St. Paul Title Ins. Corp. v. Owen, 452 So. 2d 482 (Ala. 1984)