Freeman

This is an appeal from a judgment of nonsuit entered after plaintiffs’ opening statement at trial. The primary issue tendered is whether the failure of a trustor to provide fire insurance on the secured property in accordance with the terms of the trust deed precludes the trustor, as a matter of law, from maintaining an action for wrongful foreclosure when the sole basis for declaring a default and instituting foreclosure is the lack of fire insurance.

We hold that the failure to secure fire insurance on the secured property precludes an action for wrongful foreclosure only when the lack of such insurance impairs the security for the underlying debt and this is a factual issue to be determined by the trier of fact. Accordingly, we shall reverse the nonsuit as to the defendant Lind and affirm as to defendants Northwestern Title Company of Butte County (Northwestern Title) and Central Bank.

Factual and Procedural Background

The facts, as set forth in plaintiffs’ opening statement, which for purposes of this appeal we accept as true are: On July 21, 1972, Myrtle Noel sold a parcel of property in Butte County to Terry and Martha Davis. In connection therewith, the Davises…