ProNational Insurance Company insured the law firm of Davis & Meyer, Ltd., an Ohio law firm, for “Professional Services” rendered or that should have been rendered to clients. Included in the definition of “Professional Services” was the following: “Professional services also means services (including title opinions or title certifications) performed by an Insured for others for a fee as a title insurance agent, title abstractor, title searcher, escrow agent, or closing agent.”

The law firm operated a title agency, Lakeshore Title, which conducted business in the Chicago, Illinois area. Lakeshore was sued in Cook County, Illinois.

The primary allegations were that Lakeshore had billed excessive fees for courier services and recording fees. ProNational agreed to pay for the defense of the claim, or at least a portion of the legal fees charged by a defense firm requested by the policyholder.

Months later, ProNational withdrew its defense of the title company. Davis & Meyer and Lakeshore Title commenced a suit in Franklin County, Ohio seeking declaratory relief, and alleging breach of contract, bad faith and negligence on the part of ProNational.

The Court of Appeals upheld a decision by the trial court finding that ProNational was justified in denying coverage. The Court held that charging clients for recording fees and courier services, and similar expenses, in connection with real estate closing services, did not fall within the definition of “Professional services” as defined in the ProNational policy. In narrowly construing the policy language, and rejecting the plaintiffs’ contention that the language should be broadly construed, the Court stated ‘“We resolve that the act of billing or charging clients for ministerial, or non-ministerial activities, is not a service “performed by an Insured for others for a fee,” and thus does not fit the definition of “professional services” under the policy.”’

The case is Davis & Meyer Law, Ltd., et al. v. ProNational Insurance Co., et al., No. 06AP-730 (10th Dist. 2007).

The OBLIC policy does not include coverage for an attorney acting as a title agent in its definition of “Professional Services.” Rather, such coverage can be added by endorsement to the OBLIC policy. Other insurance coverage may have to be obtained for businesses that would be deemed “law-related” under Rule 5.7 of the Professional Rules of Conduct. Such business activities are generally not considered providing “Professional Services” to others in a lawyer-client relationship under the OBLIC policy, or other lawyers’ professional liability policies, as the Davis case demonstrates.