advice needed - Title issue

[Bruce M.]

Hi,

I need some help trying to figure out what to do. I sold a property on May 30th and am holding a first mortgage for the buyer. The buyers attorney did a Title search at the local town offices on May 9th and was told that no back taxes were owed which was true at the time. On May 15th the taxes were actually due for this quarter.  The attorney went back to the town hall the day before closing to make sure the title was clear but forgot to research and ask about the taxes. We had the closing on the 30th.

Being the prior owner I received a delinquent tax notice on May 31st. I called my closing attorney and he said that the taxes "run with the property" and that is no longer my issue and that the closing attorney for the buyer should have picked that up during his search. The buyers closing attorney is trying to convince my attorney that I owe the taxes. As the lender I was issued a lender title insurance policy but I am not sure if the buyer got one too.

So morally I actually do owe the taxes but legally it seems that my buyer ( because of his attorneys mistake) now will soon have a tax lien on the property. I should also mention that I paid $1,000 towards my buyers attorneys fees and in addition he charged my buyer $850 for a grand total of $1850 in closing fees...so I am pissed off  that he took advantage. My attorney drew up the note and mortgage and closed the sale for $750.   

So what should I do from here ? The buyers attorney says I should pay and is blaming the town hall. Do I have my buyer file a title insurance claim ( if he has it ) or should I ? Do I just suck it up and pay and be even more pissed off ? What if I was Wells Fargo or some big bank...what would they do ? My lawyer seems to now be leaning towards having me pay or file a claim but it is as if he is trying to protect the other lawyer.

Whew...I know this is a lot but any help would be appreciated. I am conflicted by what seems to be the ethical thing to do and what is legally in my right. In many ways I'd like the buyers closing lawyer to make good on this. It's his fault. So where am I off here....? Brutal honesty I can handle so please don't hold back.

Thanks

Bruce