Banerian

Plaintiffs, Gordon and Margaret Banerian, appeal from a judgment of dismissal entered after the trial court sustained, without leave to amend, defendant William O’Malley’s demurrer to the third count of plaintiffs’ complaint.

The third count of the complaint incorporates various factual allegations from the other five counts of the complaint. In order to understand the theory upon which the third count is based, it is essential that we summarize the entire complaint.

Taking in chronological order the facts which are alleged by plaintiffs to have occurred, it appears that on or about May 1, 1961, plaintiffs Banerian purchased certain real property located in Danville, California. The sellers of the property, Robert and Margaret Snyder, allegedly knew that there had been extensive grading and filling performed on the property, but failed to disclose this fact to the Banerians.

Immediately upon purchasing the property, the Banerians entered into a written contract with a general contractor, Carl Hansen, for the construction of a home on the property.

On November 16, 1961, the Banerians procured a policy of personal liability and property damage insurance from Northern…