Hardcastle V. Greenwood Savings And Loan Association

Hardcastle were the mortgagors and Greenwood Savings & Loan the mortgagee of a 7-unit apartment house in Seattle. The Hardcastles were required under the terms of the mortgage to maintain fire insurance on the property. About two weeks prior to the October 31, 1968, expiration date of the policy which the Hardcastles had maintained in compliance with these terms, Greenwood Savings & Loan telephoned the Hardcastles and asked their permission to secure fire insurance coverage on the apartment house. The Hardcastles agreed and allowed their policy to lapse. Greenwood Savings & Loan had been unsuccessful in replacing the insurance when on December 13, 1968, the apartment house was severely damaged by fire.