CASE NAME: SARA MACDWYER? vs.? STEPHANIE NARDIL
HEARING ON MOTION FOR JUDGMENT ON THE PLEADINGS
FILED BY STEPHANIE D. NARDIL
* TENTATIVE RULING: *
Defendant?s motion for judgment on the pleadings is granted with leave to amend.? Plaintiff shall file any further amended complaint on or before July 24, 2015.
Each side?s request for judicial notice is granted.
The parties are directed to tab their exhibits in all future filings.? The exhibits to plaintiff?s?Complaint, and the exhibits to defendant?s request for judicial notice, are not tabbed.? (See, Cal.?Rules of Court, rule 3.1110, subd. (f).)
The basis for the Court?s ruling on the motion is as follows.
The Statute of Limitations
Plaintiff acknowledges that her judicial foreclosure action would be barred by the four-year statute of limitations for breach of a written agreement, absent the application of some kind of tolling.? (See, Code Civ. Proc., ? 337.)? The Court has granted defendant?s motion for judgment on the pleadings because plaintiff?s allegations concerning equitable estoppel are?deficient.
Plaintiff, a litigation attorney, does not allege facts showing why it was reasonable for her to wait more than four years after defendant signed the subject promissory note before bringing suit against defendant.? Defendant apparently made no effort to sell or refinance her home during that time.? Further, plaintiff does not allege that defendant, who is not alleged to be a lawyer, knew the statute of limitations for a judicial foreclosure action and intended her conduct to induce plaintiff to delay filing suit until after the statute had run.? Finally, as an attorney, plaintiff is charged with knowledge of the statute of limitations, and the law disfavors the application of equitable estoppel in this context.? (See, May v. City of Milpitas (2013) 217 Cal.App.4th 1307, 1338-39.? See also, Bergstein v. Stroock & Stroock & Lavan LLP (2015) 236 Cal.App.4th 793, 820.)
Defendant?s argument concerning the statute of frauds, and both sides? arguments concerning promissory estoppel, are not relevant to the issue of equitable estoppel to assert the statute of limitations.? Plaintiff is not pursuing a cause of action for the breach of an oral forbearance agreement; rather, plaintiff is attempting to ?plead?around? the defense of the statute of limitations.
Plaintiff?s argument based on the timing of the substitution of attorneys also lacks merit.? Plaintiff cites no law indicating that the statute of limitations for breach of contract is tolled during the time that the contracting parties are in an attorney-client relationship.? Plaintiff appears to be confusing the statute of limitations for breach of contract with the statute of limitations for legal malpractice, under which a client?s cause of action for legal malpractice may be tolled by ongoing representation.? (See, Code Civ. Proc., ??340.6, subd.?(a)(2).)
The Recordation of a Notice of Default
Defendant argues that plaintiff cannot pursue judicial foreclosure because she has not recorded a notice of default.? This argument lacks merit.
Plaintiff?s interpretation of the deed of trust is that the recordation of a notice of default is required only if plaintiff is pursuing non-judicial foreclosure.? The deed of trust is reasonably susceptible to plaintiff?s interpretation, and so that interpretation must be accepted as correct at the pleading stage.? (Southern Pacific Land Co. v. Westlake Farms, Inc. (1987) 188 Cal.App.3d 807, 817.? See also, Aragon-Haas v. Family Security Ins. Services, Inc. (1991) 231 Cal.App.3d 232, 239.)
Further, defendant has failed to explain how the failure to record a notice of default might be deemed a material breach that would operate as a contract defense.? The complaint in a judicial foreclosure action performs the same function as a notice of default in a non-judicial foreclosure proceeding, and defendant fails to argue how she could have been prejudiced by plaintiff?s failure to perform the redundant act of recording a notice of default.