Weemer (defendant), former owner of the subject property, secured a loan of $5,400 by granting a trust deed on the property in favor of her creditor. Weemer later sold the property by grant deed to the Rosettes, who financed the purchase with a promissory note for $3,250 secured by another trust deed on the property. This grant deed did not mention the trust deed. The Rosettes later sold the property to Babb (plaintiff) by a grant deed “subject to the encumbrances and easements of record.” The agreement of sale between Babb and the Rosettes recited that the purchase price reflected the sum of all existing encumbrances, approximately $8,975. Babb sued for breach of the implied covenant in the grant deed from Weemer to the Rosettes for failing to mention the earlier trust deed. The trial court ruled for Weemer. Babb appealed.