Fox & Carskadon Financial Corp. v. San Francisco Federal Savings & Loan Ass'n

This is an appeal from a summary judgment in favor of defendant-respondent San Francisco Federal Savings & Loan Association (San Francisco Federal) and against plaintiffs-appellants Fox & Carskadon Financial Corporation and El Camino Real Associates.

Fox & Carskadon Financial Corporation entered into an agreement with one Hyman Weisel (not a party to this action) in which Weisel agreed to sell to El Camino Real Associates, a limited partiiership to be formed by Fox & Carskadon, an apartment project to be constructed by Weisel. The total purchase price for the project was $2,375,000. Weisel applied to San Francisco Federal for a construction loan of $1,800,000. In June 1969, the directors’ loan committee meeting of San Francisco Federal approved the loan. At the time the respondent approved the loan it knew of the agreement between Weisel and Fox & Carskadon. In making the loan, San Francisco Federal relied on information it possessed with regard to Weisel’s financial condition from prior business dealings together.

In late December 1969, it became apparent to San Francisco Federal from information obtained from Weisel that he was experiencing financial difficulty and…