When should proximate cause be decided as a matter of law in Utah appeals? Harding v. Atlas Title Insurance Agency Explained

The Utah Court of Appeals decision in Harding v. Atlas Title Insurance Agency provides crucial guidance for practitioners on when proximate cause issues should be decided as a matter of law versus submitted to a jury. This case demonstrates the careful balance courts must strike between preventing speculative claims and preserving jury trial rights.

Background and Facts
The Hardings sold property to Pecan Ridge Partners and were to receive a trust deed recorded in second position behind another creditor’s $372,713.67 interest. Atlas Title conducted the closing but failed to record the Hardings’ trust deed until nine months later. During that delay, two additional trust deeds totaling $1,391,000 were recorded ahead of the Hardings’ interest, relegating them to fourth position. The Hardings subsequently exchanged their interests in multiple properties for a second-position interest in a third property, but lost their investment when that property was foreclosed upon.

Key Legal Issues
The trial court granted summary judgment for Atlas Title, determining that establishing causation would require impermissible speculation. The central issue on appeal was whether the Hardings’ proximate cause theory was supported by reasonable inferences from the evidence or constituted mere speculation.

Court’s Analysis and Holding
The Court of Appeals reversed, distinguishing between reasonable inferences and speculation. The court explained that “an inference is a deduction as to the existence of a fact which human experience teaches us can reasonably and logically be drawn from proof of other facts,” while speculation involves “theorizing about matters over which there is no certain knowledge.” Here, the Hardings presented evidence that they would not have traded their second-position interest (behind only $372,713.67) for another second-position interest (behind $625,000) if Atlas had properly recorded their trust deed initially. This theory had sufficient foundation in the evidence to support a reasonable inference of proximate cause.

Practice Implications
This decision reinforces that proximate cause is generally a jury question unless the facts are so clear that reasonable persons could not disagree, or the causal connection is purely speculative. Practitioners defending against causation claims should focus on whether the plaintiff’s theory has adequate evidentiary support rather than simply arguing alternative possibilities. The case also illustrates that a plaintiff’s efforts to mitigate damages do not automatically sever the causal chain to the defendant’s initial breach.