A question for all the knowledgeable lay title experts around. I understand that this is not legal advice but 'just' the opinions of (hopefully) informed people.

I purchased a multifamily property at an auction in an Ohio municipality that requires a 'Point of Sale' (POS) inspection prior to a property being transferred. For those that do not have this in their jurisdiction, a POS inspection is the municipalities procedure / opportunity to make sure the building is up to 'code', note any violations and hopefully get them fixed. A property can be sold 'AS IS WHERE IS' but still requires the inspection and certificate to be issued by the building department. The responsibility to order the POS rests absolutely with the owner / seller.

The closing date came and the ownership was transferred but no POS was carried out. The county registrars office should NOT have allowed the transfer without the POS but they did. The municipality has 'become aware' of the transfer and is now demanding a POS.

Does this become a title defect? Is there a claim against the title or escrow company for not ensuring that the local ordinances of the municipality were followed?