You're correct that the seller never informed us of the contract, even though he was required to. Our state has a standard form that buyers fill out, indicating whether there are any encumbrances, liens, etc. that the seller needs to be aware of.

What the seller SHOULD have done is informed us that the contract would have to be transferred to us as part of the home sale, and we would have factored that into our offer.

But because they failed to inform us, they ended up selling the same property to two different parties.

And you're also correct that we were never a party to the contract, and that's basically what our lawyer spelled out in our demand letter. He basically said that this was a breach of contract between the previous owner and the organization (the two parties to the contract), and they needed to handle it themselves and leave us out of it.

Eventually, after a lot of back-and-forth, the organization agreed to not pursue this any further with us and nullify the lien. They had the option to pursue the previous owner for breach of contract, which would likely have involved him returning the money, but I don't know if they actually did so or chalked it up as a loss.

My guess is title companies haven't caught up to this - they've never had unreal/intangible property associated with real estate before.

Title insurers have not had to do due diligence for decades because record keeping has gotten so reliable there is almost never a problem. The underwriters just eat whatever occasional costs arise, and title agents make bank - at least on the East Coast of the US, out West they are typically one entity but the process is the same. Solar adds an interesting new wrinkle!

You would think hopefully that having title insurance. That the title company would need to do everything for hopefully no out of pocket cost.

Mineral rights? But that's probably specialized to certain parts of the US (upper midwest, southwest, NE Appalachia).

And water rights, but mostly a west-of-the-Mississippi thing?

Yeah, those would be things they might know about, but mineral rights usually DON'T convey (in some places they do) and water rights is usually a farmland thing.

I daresay this title company will now be on the lookout for things like this!

Water rights are very common for residential properties here in Utah. I currently live in a townhome, but several of the homes I had looked at had X "shares" of water from the reservoir in the mountains a few miles away.

Title companies are like an old folks home for politically connected lawyers. They do very little, and make enough money to spackle cash over their mistakes.