Nashville, Tennessee. Bell accepted the airplane as being in satisfactory condition with the seats
and the maintenance and repair log books intact. UP Bank was not notified of Scenic’s termination
of the lease and transfer of the airplane. On November 20, 1980, Scenic instructed American Home
to delete the airplane from Scenic’s American Home policy effective November 15, 1980. At that
time, UP Bank was not notified of the deletion of the airplane from the breach of warranty
endorsement attached to the insurance policy. In fact, American Home did not send UP Bank written
notice of its cancellation of coverage of the airplane until March of 1981, well after the loss
occurred.

        On December 4, 1980, Bell leased the airplane to Robert B. O’Neal, Jr., and Tina-O Film
Enterprises,had been
deleted from the insurance policy at the time of the loss. On March 27, 1981, UP Bank contacted
Bell, and on that date first learned that the airplane had been seized by and forfeited to the United
States government.

        On April 3, 1981, UP Bank sent letters to Scenic’s insurance agent and American Home’s
representative on the policy giving notice of the seizure and requesting a copy of the policy. The
agent replied by letter dated April 13, 1981, denying coverage for UP Bank at the time the airplane
was seized, because “this aircraft was deleted from our Insured’s policy effective November 15,
1980.”

       On October 20, 1981, UP Bank filed a proof of loss with American Home. American
Home’s representative