Hi Alix,

I'm just guessing, but I think that the wiki page you were looking at was probably distinguishing contract liability from tort liability. The paragraph you included was indeed about contractual liability, but that is completely different from tort liability. Tort liability usually, though not always, is predicated on some degree of negligence. There are cases which say omitting information on a title search, that appears in the public records, is negligence.

In your situation, where you are attempting to collect from a client, the claim is for breach of contract - they failed to pay you according to the terms of the contract. As Kevin stated, the corporate shield will protect against contract liability unless you are successful in piercing the corporate veil.

With respect to abstractors, incorrectly reporting information on a title search would give your client a claim for breach of contract and/or the tort of negligent misrepresentation (it depends on your state law). The corporate shield may protect you from the contract claim, but you need E&O insurance to protect yourself from tort claims.

Best,
Robert A. Franco
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