The legal issues presented in this case will be displayed here.

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

P purchased a home from D and executed a promissory note secured by a deed of trust naming D as beneficiary with Modesto Title Guaranty (D) as trustee. The purchase price was $14,500, and the terms of the note required P to pay $100 monthly installments. The house was destroyed by a fire in January 1975. At that time $13,585.01 was owed on the house. The deed of trust provided that P agreed to restore building, which may be constructed, damaged, or destroyed and to pay the costs. It also required P to provide fire insurance with the option of D to apply it against monies owed. P got fire insurance which would pay $8,250 for the loss of the house or up to $14,100 if P decided to rebuild. A fire destroyed the house. P decided to rebuild. The insurer paid the $8,250 with the balance to be paid on completion of the house. D refused to release the money and kept it per the deed of trust. P could not make the monthly installment while paying rent for another home. P defaulted and D foreclosed. The property was sold on private sale to D for $600 who later sold it for $6,000. P sued D. P introduced evidence that a new home could have been constructed for $14,100 that would have had a fair market value of $20,000 upon completion because of the rise in property values. P had planned to sell the new home, pay off D, and keep the $6000 in equity for themselves. P got the judgment for $4,500 in that D breached the implied covenant of good faith and fair dealing. D appealed.

The court's holding and decision will be displayed here.

Legal analysis from Dean's Law Dictionary will be displayed here.