Appellant guarantors sought review of a decision by the Superior Court of Los Angeles County (California), which in a jury trial, denied its motion for a directed verdict, denied its motion for a new trial, and granted a verdict in favor of respondent bank in its cause of action alleging that appellants breached guaranty contract.
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Overview
Respondent bank filed a breach of contract action against appellant guarantors based upon their written guaranties of debt obligations to respondent. The trial court denied appellant’s motion for a directed verdict, denied its motion for a new trial, and the jury granted a verdict in favor of respondent. The court affirmed the judgment in favor of respondent because appellant signed a valid waiver of the statute of limitations, and respondent’s action was timely under Cal. Civ. Proc. Code § 360.5, which permitted suit for four years beyond the statute of limitations. The court stated that without the waiver provisions, respondent would have had four years from the dates the notes were due and unpaid to commence its action. The court also stated that appellant’s interpretation of § 360.5 negated the statutory benefit conferred under § 360.5. The two notes signed by appellant became due and payable, yet remained unpaid, on February 28, 1982, and March 15, 1982. Respondent had four years from breach, plus an additional four years afforded it by § 360.5. The complaint was filed well within the eight years. The court concluded that respondent was to recover costs on appeal.
Outcome
The court affirmed the judgment in favor of respondent bank in its suit to collect upon the guaranty contract because appellant guarantors signed a valid waiver of the statute of limitations, respondent’s action was timely under the statute where respondent had four years from breach, plus an additional four years afforded it by the statute, and respondent was to recover costs on appeal.