This section contains the nature of the case and procedural background.

In 1946, Cleary entered into a land sale contract with the State of Nevada and acquired title from the state by patent. The patent contained the land sale contract number in the upper right-hand corner of the document. The land sale contract was not recorded. Before acquiring legal title to the land but still enjoying the patent, Cleary granted a power line easement over a portion of the property to Sierra Pacific Power Company which document the company caused to be recorded. Title then passed from Cleary to various persons and finally in 1964, to the present owners, Ryczkowski (P). Title Guaranty was engaged to search the record for defects in title and Chelsea Title (D) to insure title to the land. The title search by D stopped in 1952 with the recorded patent from the state. The 1949, power easement was not discovered. P then sued D.

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