Opinion
This is a consolidated appeal by cross-complainant Sta-gen from (1) a judgment on the pleadings in favor of Stewart-West Coast Title Company (hereinafter West Coast Title), and (2) a judgment on the pleadings in favor of Stewart Title Guaranty Company (hereinafter Title Guaranty), an affiliate of West Coast Title.
Facts
On August 20, 1976, Stagen, a licensed real estate broker, and Simon Bard entered into a written contract of sale, whеrein Bard was to convey certain real property to Stagen. The property was the community property of Simon Bard and his wife Stella but was held by them as “husband and wife, joint tenants.” Stagen was aware, through his agent, of Stella Bard’s community interest in the property. Only the husband, Simon Bard, signed *117 the contract of sale, which was intended by both Stagen and Bard to cover the entire property and not merely an undivided onе-half interest therein.
On October 7, 1976, after repeated demands for Bard’s performance, Stagen filed an action against Simon Bard for specific performance. Stella Bard was not named as a defendant in Stagen’s complaint. On the same date, Stagen recorded a notice of pending action (lis pendens) on the property.
On October 8, 1976, Simon Bard and Stella Bard conveyed the property to H. & G. Brown (Vz interest), and J. & P. Mora (Vz interest). In connection with this conveyance, either Bard, as the seller, or the Browns and Moras, as buyers, obtained the services of West Coast Title and Title Guaranty to search the record as an abstractor of title and to issue a policy of title insurance. The title report failed to disclose the existence of Stagen’s lis pendens.
Stagen amended his complaint to include the Browns and Moras as co-defendants with Simon Bard. The Browns and Moras filed a cross-complaint against the Bards and Stagen. Stagen filed a cross-complaint against West Coast Title and Does 1 through 10 and later amended it to name Title Guaranty as a cross-defendant in place of Doe 1. Only the Stagen cross-complaint is involved in these appeals.
West Coast Title and Title Guaranty filed separate answers. On June 29, 1981, West Coast Title moved for a judgment on the pleadings on the ground that since Stagen was not in contractual privity with West Coast Title, and was not within the class of persons intended to be benefitted by the title report, no duty of care was owed to him. Hence, Stagen’s cross-complaint failed to state a cause of action against West Coast Title. The superior court, Judge Chernow, granted the motion, and judgment for crоss-defendant West Coast Title was entered. Stagen appealed from that judgment.
During the trial, Title Guaranty moved for a judgment on the pleadings, on the ground that the judgment in favor of West Coast Title left no cause of action against Title Guaranty because the cross-complaint did not allege any negligent acts or omissions by Title Guaranty.
The matter was tried initially before a jury (as to the legal causes of action) which determined that Bard had breached the land sale contract in bad faith. Stagen was awarded both actual and punitive damages. Thereafter, the equitable causes of action were tried by the court, which denied specific performance on the grounds that the property was the community *118 property of Simon Bard and his wife; Mrs. Bard was not a party to the contract; Stagen had notice оf these facts; ordering specific performance would have required the court to enforce a contract that neither party intended to make; and Stagen’s legal remedy was adequate.
After trial the superior court, Judge Ackerman, made and entered a judgment which included granting Title Guaranty a judgment on the pleadings. Stagen then appealed from that part of the judgment granting Title Guaranty a judgment on the pleadings.
The two appeals are here consolidated.
Contentions
Stagen contends that where it is foreseeable to a negligent party that its acts would harm a particular third party, privity of contract is not required as a basis for liability. He maintains that respondent title companies were negligent in failing to disclose the lis pendens recorded in connection with his action for specific performance against Bard, the seller of the proрerty. Stagen asserts that respondents knew, or should have known, that their omission of the lis pendens from the title report would jeopardize the rights of that class of individuals (e.g., persons, such as himself, who are claimants of an interest in the title to, or the right of possession of, real property) who reasonably rely on title companies to disclose the recordation of a lis pendens.
He argues that defеndants are liable because the lis pendens was recorded with the reasonable expectation that if the seller attempted to sell the property to another buyer, the prospective buyer would not purchase property with such a cloud on its title. Stagen concludes that had the title companies acted in accordance with their duty to their insured no sale would have been completed, and the remedy of specific performance would have been practicable at trial.
Discussion
When abstractors are negligent in preparing a title report, recovery may be sought either in contract or tort.
(Northwestern Title Security Co.
v.
Flack
(1970)
Recovery on the Contract
Civil Code section 1559 provides: “A contract, made expressly for the benefit of a third person, may be enforced by him at any time before the *119 parties thereto rescind it.” The measure of damages for breach of a contract is as provided in Civil Code section 3300.
To recover for breach of an obligation arising from a contract, a third person not in privity with a party to the contract must be an intended third party beneficiary of the contract
(Lucas
v.
Hamm
(1961)
In the instant case the buyers employed respondent title companies to search the record as abstractors of title and to insure good title to the рroperty. Because the abstractor did not know of Stagen’s interest in the property at the time the contract was performed, it follows that he could not have been an intended third party beneficiary of the contract. Stagen thus has no ground for recovery on the contract.
Recovery in Tort
In a proper case, there is a cause of action in tort against professional suppliers of information for the guidance of others. The measure of damage for breach of an obligation not arising from contract is as provided in Civil Code section 3333.
The Restatement of Torts section 552, 1 cited and approved by the Hawkins court, supra, 165 Cal.App.2d at pages 125-126, sets forth the rule of liability for professional suppliers of information for the guidance of others in their business transactions. “One who in the course of his business or profession supplies information for the guidance of others in their business transаctions is subject to liability for harm caused to them by their reliance upon the information if (a) he fails to exercise that care and competence in obtaining and communicating the information which its recipient is justified in expecting, and (b) the harm is suffered (i) by the person or one of the class of persons for whose guidance the information was supplied, and (ii) because of his justifiable reliance uрon it in a transaction in which it was *120 intended to influence his conduct or in a transaction substantially identical therewith.”
In
Kenny
v.
Safeco, supra,
In
Banville
v.
Schmidt
(1974)
In fact, the maker of the note had recorded a deed conveying the property back to the buyer of plaintiffs’ property six days prior to issuance of the policy to plaintiffs. The encumbered property was actually inadequate as security for the note, and the maker of the note was in shaky financial condition {id., at pp. 96-97).
Plaintiffs brought an action in tort for negligence, fraud, and misrepresentation against the broker, the buyer, and the title company. The trial court granted judgment against the broker and the buyer for compensatory and punitive damages, but granted judgment for the title company and against plaintiffs, who appealed from the judgment for the title company.
On appeal, the title company urged that it was only an insurer of title; that it owed no duty to the plaintiffs to search the title; that its liability, if any, could be founded only in contract, which was not pleaded; and that it *121 could not be held liable on the basis of negligence. (Id., at p. 102.) The Court of Appeal reversed and directed that the trial court enter judgment for plaintiffs and against the title company, citing section 552 and pointing out that the title insurance policy was issued to insure the plaintiffs against the very loss which they suffered, and that it would be unconscionable to say that the title company did not owe a duty to the plaintiffs to reasonably and carefully perform their search and examination. (Id., at pp. 104-105.)
The broker cross-complained against the title company for indemnity, alleging that its negligence in incorrectly reporting the status of the title to the property securing the trust dеed was a superseding cause of any damage incurred by plaintiffs; and that if the broker should be held liable to plaintiffs, the title company should indemnify the broker. The trial court sustained without leave to amend the title company’s demurrer to the broker’s cross-complaint. The court of appeal affirmed, pointing out that there was no privity of contract between the broker and the title company, thаt the “end and aim” of the title insurance policy was not to protect the broker from the consequences of his own negligence, and that the conduct upon which the broker’s liability to plaintiffs was predicated was not done in reliance upon any information furnished by the title company. Thus, there was no basis for holding the title company liable to the broker.
De Zemplen
v.
Home Federal S. & L. Assn.
(1963)
Plaintiffs alleged that a title company falsely represented to them that, in acquiring certain property in an exchange, they would be protected by an existing indemnity agreement in respеct to the property. Those representations were false, plaintiffs relied upon them to their damage, and the title company intended that plaintiffs rely upon those representations. The court of appeal reversed the judgment, citing section 552, holding that it was not necessary to plead privity of contract to maintain an action for negligent misrepresentation and pointing out that thе only limitations in section 552 are that the defendant must intend that the plaintiff rely on the information and that the plaintiff must rely on it to his detriment. (Id., at pp. 205-206.)
In each case cited above title companies were found liable only to persons (1) for whose guidance information was supplied; (2) who justifiably relied on the information; and, most importantly, (3) who were intended to be influenced by the communication. Intent to influence is a threshold issue. In its absence there is no liability even though a plaintiff
*122
has relied on the misrepresentation to his or her detriment, and even if such reliance were reasonably foreseeable.
2
(Walters
v.
Marler
(1978)
In the instant case, although respondents are professional suppliers of information, they did not supply information for Stagen’s guidance, but rather for that of the buyers. Thus, any failure to exercise сare in obtaining and communicating the fact that a lis pendens affecting the subject property had been recorded by Stagen would have been actionable only by the buyers.
Moreover, the buyers were the only parties whose reliance on the information was intended and which was justified; they are the persons to whom it was supplied. Stagen did not receive the information supplied to the buyers by the titlе companies, and he did not rely upon it. Stagen alleges that when he recorded the lis pendens he anticipated that some future title company would disclose its existence to a potential buyer, and the buyer would refrain from purchasing the property. Such reliance is not justified. The buyer could decide to purchase the property regardless of the lis pendens, or the title company сould decide that it would assume the risk of the plaintiff’s pending suit. It is not reasonable to take a document intended to impart notice of a pending action affecting the property
(Lee
v.
Silva
(1925)
Stagen’s analysis is also factually flawed. He has not been harmed by respondents’ asserted negligence in omitting to report the existencе of the lis pendens in the abstract prepared for buyers. As previously noted, “[t]he purpose of a
lis pendens
is merely to furnish a means of notifying all persons of the pendency of an action and thereby to bind any person who may acquire an interest in property, subsequent to the institution of the action, by any judgment which may be secured in the action affecting the property.”
(Lee
v.
Silva, supra,
*123
A judgment favorable to the plaintiif relаtes to, and receives its priority from, the date the lis pendens is recorded, and is senior and prior to any interests in the property acquired after that date (Civ. Code, § 1214;
Moore
v.
Schneider
(1925)
Stagen’s argument that had the title companies not failed to disclose the lis pendens no sale would have been completed and the remedy of specific performance would have been practicable at trial, is also without merit. The trial court denied specific performance because the property was the community property of the seller and his wife, the wife did not execute the sales contract, and Stagen was aware of these circumstances. The court concluded that ordering specific performance would have required it to enforce a contract that neither party ever agreed to, and Stagen’s legal remedy of damages was adequate. It is obvious that Stagen’s failure to recover judgment for specific performance was not caused by the subsequent sale of the property.
Stagen also relies on a line of cases commencing with
Biakanja
v.
Irving
(1958)
In finding for the intended beneficiary, the court concluded that “the ‘end and aim’ of the transaction was to provide for the passing of [decedent’s]
*124
estate to plaintiff.”
(Id.,
see also
Kenny
v.
Safeco Title Ins. Co., supra,
Stagen has no ground for recovery under Biakanja and its progeny. The “end аnd aim” of the transaction here, the title search and issuance of title insurance, was not intended to affect Stagen but to protect the buyers. 3
Disposition
The judgment on the pleadings for West Coast Title and the judgment on the pleadings for Title Guaranty are both affirmed.
Klein, P. J., and Lui, J., concurred.
Notes
References to section 552 hereinafter are to the Restatement of Torts.
In
Jarchow
v.
Transamerica Title Ins. Co.
(1975)
Stagen urges the court to adopt the standard set forth in
Williams
v.
Polgar
(1974)