Preview
1 Matthew S. Kennedy – CSB No. 125620
MATTHEW S. KENNEDY, A Professional Law Corporation
2 Post Office Box 1031
San Luis Obispo, California 93406-1031
3 (805) 544-5002 / (805) 544-5003
E-Mail: msk@KennedyLawRealty.com
4
Attorneys for Defendant Mechanics Bank,
5 a California corporation, successor by merger
to Rabobank, N.A.
6
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 COUNTY OF MONTEREY
10
11 ROBERT T. ELLIOTT, CASE NO. 21 CV 003944
Assigned to: Hon. Carrie M. Panetta
12 Plaintiff,
13 vs. DEFENDANT MECHANICS BANK’S
SUPPLEMENTAL BRIEF RE THE BANK’S
14 MECHANICS BANK, a California MOTION FOR SUMMARY JUDGMENT
corporation, as the Successor-in-Interest to
15 Rabobank, N.A., a California corporation;
RABOBANK, N.A., a California Cont. Date: September 29, 2023
16 corporation; and DOES 1 - 40, inclusive, Time: 8:30 a.m.
Dept: 14
17 Defendants.
18 Complaint filed: December 20, 2021
CMC: October 31, 2023
19 Trial Date: None Assigned
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21
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23 Defendant Mechanics Bank, successor by merger to Rabobank, N.A., (“the Bank”)
24 submits its Supplemental Brief requested in the Court’s Tentative Ruling, dated July 20, 2023 re
25 Defendant Bank’s Motion for Summary Judgment.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 THE BANK’S SUPPLEMENTAL BRIEF
2 I. THE STATUTE OF LIMITATIONS BARS PLAINTIFF’S LAWSUIT.
3 The Court, in its tentative ruling, specified that a pertinent issue is the determination of
4 the date when the purported settlement agreement was breached for purposes of accrual of the
5 sole cause of action for breach of contract. Noted was paragraph BC-2 of Plaintiff’s Complaint
6 alleging that the breach occurred “on or about: April-October 2018” for “failing and continuing
7 to fail to provide Plaintiff a manner and method of payment”. Plaintiff admits in his Declaration
8 there is no mention in the purported settlement of the manner and method of payment, as well as
9 no deadline for payment instructions. As the accrual period cannot exist in perpetuity, what is a
10 “reasonable time” under the facts and circumstances? (Civ. Code, § 1657.)
11
A. Substantial Evidence Establishes the Breach of Contract Claim Accrued by
12 September 2015.
13 The statute of limitations for breach of a written contract “is four years from the time the
14 claim accrues.” (Gilkyson v. Disney Enterprises, Inc. (2016) 244 Cal.App.4th 1336, 1341.) A
15 breach of contract claim “accrues at the time of breach, which then starts the limitations period
16 running.” (Cochran v. Cochran (1997) 56 Cal.App.4th 1115, 1120; Church v. Jamison (2006)
17 143 Cal.App.4th 1568, 1583.) “[A] breach of contract ordinarily occurs upon the promisor’s
18 failure to render the promised performance.” (McCaskey v. California State Automobile Assn.
19 (2010) 189 Cal.App.4th 947, 958 [emphasis in original].)
20 Even if there is an agreement, which there is not, the Bank maintains any breach occurred
21 in September 2015 because, by that date, Plaintiff was to have made his fourth and final payment
22 under the purported settlement but had not, as he alleges the Bank did not provide him with a
23 manner and method of payment. Substantial evidence supports the September 2015 conclusion.
24 If Plaintiff’s email of January 22, 2014, with an attached proposal promising to pay $140,000 in
25 four biannual installments, and the Bank’s January 23, 2014 email it was “willing to accept” the
26 $140,000 “requir[ing] some additional review and work” is the professed settlement agreement,
27 then September 2015 is the latest date the Bank refused to perform, i.e., provide the manner and
28 method of payment.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 While there is nothing in the purported “agreement” about the manner and method of
2 payment, Plaintiff emailed the Bank on April 1, 2014 – the date his first installment payment was
3 due – “want[ing] to confirm the settlement” and “if we could confirm the settlement” and if
4 Plaintiff “should deposit into an escrow account”. 1 Then absolute silence from Plaintiff through
5 his promised second installment payment, his promised third installment payment, and his
6 promised fourth installment payment in September 2015. It was not until almost four years later,
7 in February 2018, that he chose to contact the Bank.
8 Plaintiff may have had strategic personal or business reasons to refrain from filing a
9 lawsuit in September 2015 – for example, his own admission he “was on to bigger and better
10 things” 2 – but those motivations do not mean Plaintiff’s breach of contract claim did not accrue
11 by that date. Substantial evidence supports a finding that Plaintiff’s breach of contract claim
12 accrued by September 2015 and his Complaint, filed in December 2021 more than four years
13 later, is barred by the statute of limitations. (Code Civ. Proc., § 337(a).)
14
15 B. Any Accrual Arguments Past September 2015 by Plaintiff are Unavailing.
16 On the topic of accrual, the Court requests that the parties address Civil Code section
17 1657, which states:
18 If no time is specified for the performance of an act required to be
performed, a reasonable time is allowed. If the act is in its nature capable
19 of being done instantly—as, for example, if it consists in the payment of
money only—it must be performed immediately upon the thing to be done
20 being exactly ascertained.
21 Further, the Court “believes the case of Estate of Jones (2022) 82 Cal.App.5th 948 may be
22 helpful”. Estate of Jones involved a probate petition to enforce a stipulated judgment under Code
23 of Civil Procedure section 664.6, rather than a breach, which stipulated judgment’s express terms
24 were more delineated than the truncated emails between Plaintiff and the Bank here.
25
1
See the Bank’s Exhibit M, “Email dated April 1, 2014 from Plaintiff Robert Elliott” to the Bank in Defendant
26
Mechanics Bank’s Evidentiary Exhibits in Support of Its Motion for Summary Judgment, filed April 21, 2023 (“the
27 Bank’s Evidentiary Exhibits”).
2
See the Bank’s Exhibit R, “Deposition of Plaintiff Robert T. Elliott, 121:23-122:1”, in the Bank’s Evidentiary
28
Exhibits.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 Nevertheless, by referring the parties to Estate of Jones, the Bank construes the Court as positing
2 that the “manner and method of payment” alleged in Plaintiff’s Complaint may be a condition
3 precedent that suspended the deadline for Plaintiff to perform. This line of reasoning is not
4 persuasive.
5 In its basics, Plaintiff’s Complaint alleges the parties reached a contractual settlement
6 agreement in January 2014 wherein Plaintiff would pay $140,000.00 in four installments on a
7 $3,354,371.34 Judgment entered on July 8, 2008 in Monterey County Superior Court Case No.
8 M82496 in exchange for satisfaction of Plaintiff’s obligations on the Judgment. Plaintiff is not
9 seeking to enforce the settlement contract, rather Plaintiff alleges the Bank breached the contract by
10 “failing to provide Plaintiff a manner and method of payment” of the $140,000.00 on or about “April-
11 October 2018” 3 – more than four years after Plaintiff promised to perform. In essence, under Estate
12 of Jones, an implied condition precedent to Plaintiff’s payments and, the argument would follow, that
13 because the Bank did not detail “manner and method of payment” Plaintiff’s breach of contract claim
14 could not accrue. This theory defies logic and begs the question how a plaintiff can prosecute a claim
15 that could potentially never accrue – simply by sitting back and doing nothing.
16 A “condition precedent is either an act of a party that must be performed or an uncertain
17 event that must happen before the contractual right accrues or the contractual duty arises.” (Estate
18 of Jones, supra, 82 Cal.App.5th at p. 953, citing Platt Pacific, Inc. v. Andelson (1993) 6 Cal.4th
19 307, 313.) Conditions precedent are not favored and contractual provisions will not be so
20 construed in the absence of language plainly requiring such a construction. (Helzel v. Superior
21 Court (1981) 123 Cal.App.3d 652, 663.) A court should not construe a contract as imposing a
22 condition precedent “in the absence of language plainly requiring such a construction”, such as
23 “subject to” or “conditioned on”. (Estate of Jones, supra, 82 Cal.App.5th at p. 953; Rubin v.
24 Fuchs (1969) 1 Cal.3d 50, 54; In re Marriage of Hasso (1991) 229 Cal.App.3d 1174, 1181.)
25 Courts should not “interpret a condition as a condition precedent absent clear, unambiguous
26
27
28 3
The Bank’s Exhibit T, “Complaint, filed December 20, 2021”, BC-1, BC-2”, in the Bank’s Evidentiary Exhibits.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 language requiring that construction. (Estate of Jones, supra, 82 Cal.App.5th at p. 953, citing
2 Helzel v. Superior Court, supra, 123 Cal.App.3d at p. 663.)
3 Here there is no mention in the January 2014 emails that comprise the purported
4 agreement of the “manner and method of payment” as a conditional term. Plaintiff’s four
5 installment payments totaling $140,000 were not “subject to” or “conditioned upon” a “manner
6 and method of payment”. Plaintiff, by his own express proposal, was to make the four payments
7 to the Bank beginning in April 2014 and ending in September 2015. Yet, from January 23, 2014
8 through April 2018 Plaintiff never once raised a question to the Bank as to the “manner and
9 method of payment”. He testified he was busy and then just blithely moved on “to bigger and
10 better things”. Plaintiff then waited until December 2021 to file his Complaint.
11 This Court may interpret the settlement terms and conditions laid out in Plaintiff’s
12 January 21, 2014 letter to the Bank, Plaintiff’s January 22, 2014 email to the Bank, and the
13 Bank’s January 23, 2014 email to Plaintiff, “but it cannot impose terms to which the parties did
14 not agree”. (Estate of Jones, supra, 82 Cal.App.5th at p. 952, citing Weddington Productions,
15 Inc. v. Flick (1998) 60 Cal.App.4th 793, 810.) Contrary to Plaintiff’s allegations in his Complaint,
16 as well as the facts and circumstances of snubbing his purported settlement with the Bank, the
17 Court cannot now “insert in the contract language [a condition precedent] which one of the parties
18 now wishes were there”. (Estate of Jones, supra, 82 Cal.App.5th at p. 953, citing Levi Strauss &
19 Co. v. Aetna Casualty & Surety Co. (1986) 184 Cal.App.3d 1479, 1486.)
20 Meanwhile, the lack of express language as to the “manner and method of payment”
21 cannot undermine Plaintiff’s unconditional promise to pay the amount and installment terms of
22 his agreement. (McCaskey v. Calif. State Automobile Assoc. (2010) 189 Cal.App.4th 947, 958.)
23 Plaintiff could have established an escrow account as he submitted in his April 1, 2014 email to
24 the Bank 4 but he never did. He could have assigned as collateral the title to his commercial field
25
26
27 4
See the Bank’s Exhibit M, “Email dated April 1, 2014 from Plaintiff Robert Elliott” and Exhibit R, “Deposition
of Plaintiff Robert T. Elliott”, 143:17-23, 144:19-22 in the Bank’s Evidentiary Exhibits.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 trucks as stated in his January 2014 settlement offer 5 but he did not. Plaintiff admits he could
2 have gone into a branch office to make his payments 6 but he never did.
3 Plaintiff’s delayed reliance of the “manner and method of payment” is unavailing even if
4 the purported agreement did not fix a time for the Bank to designate the “manner and method of
5 payment”. Where a contract does not fix a time for the performance of an act required to be
6 performed, a reasonable time is allowed though it may be coincidental with the statute of
7 limitations. “The law implies that a contract shall be performed within a reasonable time ….
8 Reasonable diligence and good faith must be required in such instances and it is the duty of the
9 court [to] fix a time which would be fair.” (Pitzer v. Wedel (1946) 73 Cal.App.2d 86, 91
10 [emphasis added]; Civ. Code, § 1657.) In other words, the expiration of the “reasonable time”
11 for performance triggers the start, not the end, of the statutory limitations period.
12 Plaintiff’s allegations and arguments that his breach of contract claim is postponed
13 indefinitely until he learned of the “manner and method of payment” is not persuasive. As has
14 been argued repeatedly and supported by substantial evidence in the Bank’s Motion for Summary
15 Judgment, its Reply to Plaintiff’s Opposition, and in this Supplemental Brief, Plaintiff’s waiting
16 from April 1, 2014 to April 6, 2018 to request the “manner and method of payment” is not
17 reasonable diligence and not a party to a contract acting in good faith. In no realm of “reasonable”
18 would, or should, the start of the statutory limitations period be April 2018. Especially as the
19 evidence establishes Plaintiff did absolutely nothing for the four years from April 2014 to April
20 2018 to perform his promise to pay or to urge the Bank to propose the “manner and method of
21 payment”.
22 ‘Statute of limitations’ is the ‘collective term ... commonly applied to a
great number of acts,’ or parts of acts, that ‘prescribe the periods beyond
23 which’ a plaintiff may not bring a cause of action. It has as a purpose to
protect defendants from the stale claims of dilatory plaintiffs. It has as a
24 related purpose to stimulate plaintiffs to assert fresh claims against
defendants in a diligent fashion. Inasmuch as it ‘necessarily fix[es]’ a
25
5
See the Bank’s Exhibit F, “Email dated January 22, 2014 from Plaintiff Robert Elliott” to the Bank with Plaintiff’s
26
settlement offer and Exhibit R, “Deposition of Plaintiff Robert T. Elliott”, 144:25-145:4, in the Bank’s Evidentiary
27 Exhibits.
6
See the Bank’s Exhibit R, “Deposition of Plaintiff Robert T. Elliott, 134:12-21, 137:13-20, 138:22-139:11”, in
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the Bank’s Evidentiary Exhibits.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 ‘definite period [] of time’ ... it operates conclusively across the board, and
not flexibly on a case-by-case basis.
2
(Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 395-396 [internal citations
3 omitted].)
4
5 II. THE DOCTRINE OF EQUITABLE ESTOPPEL DOES NOT APPLY.
6 A further issue to be addressed per the Court’s tentative ruling is the issue of equitable
7 estoppel. The Court asks, “if the breach of contract occurred more than four years before the
8 complaint was filed, should [the Bank] be estopped from relying upon the defense of the statute
9 of limitations?” Even with the Bank’s consistent contention that no contract was created in
10 January 2014, substantial evidence establishes Plaintiff did not reasonably rely on any statement
11 made by the Bank. Hence, the Bank is not equitably estopped from asserting a statutory
12 limitations period.
13
A. The Evidence Demonstrates That Equitable Estoppel Is Not Justified to Bar
14 the Bank’s Statute of Limitations Defense.
15 In appropriate cases, a defendant may be equitably estopped from asserting a statutory
16 limitations period. Equitable estoppel empowers a court to allow a plaintiff to proceed with a
17 time-barred claim because the defendant has engaged in unjust conduct. The burden of proof to
18 establish equitable estoppel lies with the plaintiff. (Lantzy v. Centrex Homes (2003) 31 Cal.4th
19 363, 383; Doe v. Marten (2020) 49 Cal.App.5th 1022, 1027.)
20 An aspect of equitable estoppel is codified in Evidence Code section 623 which, with its
21 annotations, provides that “[w]henever a party has, by his own statement or conduct, intentionally
22 and deliberately led another to believe a particular thing true and to act upon such belief, he is
23 not, in any litigation arising out of such statement or conduct, permitted to contradict it.”
24 (Emphasis added.) In most cases, a plaintiff pleads the prerequisites of equitable estoppel to
25 sidestep any statute of limitations defenses (which Plaintiff did not do here). The court then
26 assesses whether the defendant’s conduct actually and reasonably persuaded plaintiff to forbear
27 suing within the limitations period. Additionally, the court must evaluate whether a plaintiff’s
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 detrimental reliance was reasonable. (Lantzy v. Centrex Homes, supra, 31 Cal.4th at p. 385;
2 Munoz v. State of California (1995) 33 Cal.App.4th 1767, 1785.)
3 Accordingly, (1) if one potentially liable represents, while the limitations period is still
4 running, that all actionable damage has been or will be averted, thus making it unnecessary to
5 sue, (2) the plaintiff reasonably relies on the defendant’s representation to refrain from bringing
6 a timely action, (3) the representation proves false after the limitations period has expired, and
7 (4) the plaintiff proceeds diligently once the truth is discovered, the defendant may be equitably
8 estopped to assert the statute of limitations as a defense to the action. (Lantzy v. Centrex Homes,
9 supra, 31 Cal.4th at p. 384; see also Vu v. Prudential Property & Casualty Ins. Co. (2001) 26
10 Cal.4th 1142, 1153.)
11 In Salmons v. Jameson (1956) 144 Cal.App.2d 698, referenced by this Court, the
12 plaintiffs brought an action for specific performance and to quite title on a written contract for
13 the purchase of a ranch of 930 acres of which 30 acres would be deeded back to plaintiffs by the
14 defendants. The defendants conceded that under the land sale contract the plaintiffs “had a perfect
15 right to live” on the property and “to build their home there”. The plaintiffs constructed a house
16 on the 30 acres, made improvements to the water system to the property, and built a road leading
17 from the county road to the house – all with defendants’ knowledge and with no objections by
18 defendants. (Id. at pp. 699-700.) Meanwhile, for those eight years the plaintiffs repeatedly asked
19 defendants for the promised deed to the 30 acres, which defendants “stalled” off on. Finally, after
20 eight years, plaintiffs “demanded” the deed and defendants for the first time claimed that
21 plaintiffs “had only a ‘life lease’” and refused to give plaintiffs a deed to the 30 acres. (Id. at p.
22 701.) When plaintiffs filed suit, defendants raised the statute of limitations as a defense.
23 In affirming the trial court’s ruling that the statute of limitations did not bar plaintiffs’
24 claims, the appellate court held that “it is well settled that a person by his conduct may be
25 estopped to rely upon” the defenses of laches or the statute of limitations “where the delay in
26 commencing action is induced by the conduct of the defendant”. (Salmons v. Jameson, supra,
27 144 Cal.App.2d at p. 705.) “In the instant case the evidence shows that [plaintiffs] repeatedly
28 asked for a deed to the property and that [defendants] ‘stalled it off’ and that [defendants’] refusal
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 to execute a deed was not made until [eight years later]. (Ibid.) In other words, the defendants’
2 continual stalling to plaintiffs’ continual inquiries were false representations. And, when
3 defendants finally flat out refused to provide the deed, which was after the limitations period ran
4 out, the defendants were then estopped from raising the statute of limitations defense.
5 The Bank contends that Salmons is so factually distinguishable from Plaintiff’s facts and
6 circumstances as to not be applicable. Here, Plaintiff did not repeatedly ask the Bank for a
7 “manner and method of payment” or demand that the Bank proceed with the next steps to execute
8 the purported settlement agreement. In fact, Plaintiff admittedly walked away from the alleged
9 settlement for four years, never performing or attempting to perform his promises of payment.
10 Moreover, the Bank made no representations to Plaintiff, whether false or true, that there was
11 even a contractual settlement agreement, let alone, never once making any reference to a “manner
12 and method of payment”. The Bank fails to see how the doctrine of equitable estoppel under
13 Salmons applies.
14 The Bank’s contention is further supported by more recent case law. In Lantzy v. Centex
15 Homes, supra, a construction defect case where the plaintiffs waited to file suit until after the 10-
16 year statute of limitations period of Code of Civil Procedure section 337.15, the California
17 Supreme Court ruled that the plaintiffs’ efforts to plead around the limitations period was
18 insufficient to equitably estop the defendant from raising the statute of limitations as a viable
19 affirmative defense. Although the matter was decided on defendant’s demurrer, the California
20 Supreme Court’s holding in Lantzy is applicable here.
21 The plaintiffs in Lantzy contended that “at various times [d]efendants have attempted to
22 make repairs … or advised [p]laintiffs that the defective windows were not defective and not to
23 file a lawsuit” and thus the defendants were “estopped to assert” a statute of limitations
24 affirmative defense. (Lantzy v. Centrex Homes, supra, 31 Cal.4th at p. 385.) The California
25 Supreme Court held that the complaint was devoid of any indication, let alone evidentiary facts,
26 that the defendant’s conduct “actually and reasonably” persuaded plaintiffs to hold back from
27 suing. Moreover, there were no “suggestions” by defendant that the alleged repair attempts would
28 have precluded plaintiff from filing a lawsuit. Nothing in defendant’s conduct prevented the
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 plaintiffs from challenging defendant’s representations and filing a timely lawsuit. (Ibid.) The
2 plaintiffs chose not to file suit within the limitations period.
3 In Doe v. Marten, supra, a medical malpractice action, the plaintiff patient did not timely
4 file a lawsuit because she relied on defendant doctor’s agreeing to plaintiff’s arbitration demand,
5 even though the defendant doctor was not a signatory on the arbitration agreement. The trial court
6 found the malpractice claim time-barred and dismissed the action. The plaintiff patient appealed
7 on the grounds the defendant doctor was equitably estopped from asserting the statute of
8 limitations defense. (Doe v. Marten, supra, 49 Cal.App.5th at pp. 1024-1025.)
9 The First District Court of Appeal, relying on Lantzy v. Centex Homes, held that in the
10 statute of limitations context, equitable estoppel is only appropriate where the defendant’s act or
11 omission actually and reasonably persuaded the plaintiff to refrain from filing a timely lawsuit.
12 “The requisite act or omission must involve a misrepresentation or nondisclosure of a material
13 fact bearing directly on the necessity of bringing a timely suit.” (Doe v. Marten, supra, 49
14 Cal.App.5th at p. 1028.) “The salient fact is that defendant responded to plaintiff’s arbitration
15 demand in a manner so as to induce plaintiff to reasonably and in good faith proceed with
16 arbitration instead of filing a legal action.” (Id. at p. 1030.) It was not until defendant doctor
17 belatedly challenged the arbitration demand, which demand was timely served, that plaintiff
18 promptly filed her civil action albeit beyond the limitations period. (Id. at p. 1032.)
19 Here, there is no issue of material fact establishing that Plaintiff refrained from filing a
20 timely suit in reasonable reliance for the Bank’s not advising Plaintiff the “manner and method
21 of payment” as alleged in Plaintiff’s Complaint. Not once from April 1, 2014 through September
22 1, 2015 did Plaintiff ask the Bank for the “manner and method of payment”. Instead, Plaintiff
23 unreasonably sat on his hands until April 2018 when he inquired of the Bank’s attorney how to
24 make the installment payments that were due between April 2014 and September 2015. This was
25 four years after the payments were due.
26 There is no evidence that the Bank made any representations, misrepresentations, or
27 nondisclosures of a material fact on the necessity of Plaintiff to bring a timely lawsuit to enforce
28 a settlement agreement that only Plaintiff believed existed. Nor is there evidence, as required
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 under the law, that the Bank made any representations or misrepresentations to dissuade Plaintiff
2 from bringing a lawsuit.
3 Plaintiff alleges in his Complaint that the Bank breached the contract by “failing to provide
4 Plaintiff a manner and method of payment” of the $140,000.00 on or about “April-October 2018”. 7
5 The Bank posits the allegation is disingenuous as the installment payments were due from April 2014
6 through September 2015 – not in the contrived time period of “April-October 2018”. Nevertheless,
7 Plaintiff did nothing for four years to meet his obligations and, to repeat, the Bank made no
8 representations, misrepresentations, or nondisclosures to prevent Plaintiff from filing suit.
9 To complicate matters, and in direct contravention of the allegations in his Complaint,
10 Plaintiff proffers his declaration in opposition to the Bank’s summary judgment motion now
11 claiming the statute of limitations did not begin to run until April 2018 when the Bank, ostensibly
12 for the first time, denied there was an enforceable settlement agreement. 8 Rather, as Plaintiff
13 always knew, the emails of January 2014 were an “agreement to agree” to continued settlement
14 negotiations requiring “additional review and work with both the SBA and Central Coast
15 SBDC”. 9
16 In other words, there is no evidence the Bank’s conduct actually and reasonably
17 persuaded Plaintiff not to sue for enforcement or breach of the purported settlement agreement.
18 There is also no evidence of any detrimental reliance by Plaintiff that was in any way, shape, or
19 form, reasonable. In fact, there is no evidence whatsoever, let alone substantial evidence, that the
20 doctrine of equitable estoppel should preclude the Bank from asserting the statute of limitations
21 as an affirmative defense.
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7
See the Bank’s Exhibit T, “Complaint, filed December 20, 2021”, BC-1, BC-2”, in the Bank’s Evidentiary
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Exhibits.
26 8
See Declaration of Robert T. Elliott in Support of Opposition” to the Bank’s Motion for Summary Judgment,
27 dated July 6, 2023, ¶¶ 36, 37.
9
See the Bank’s Exhibit F, “Email dated January 22, 2014 from Plaintiff Robert Elliott” to the Bank with Plaintiff’s
28
settlement offer and Exhibit H, “Email dated January 23, 2014 from Frank Oliver” to Plaintiff.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 Respectfully submitted,
2 Dated: September 5, 2023 MATTHEW S. KENNEDY,
A Professional Law Corporation
3 Digitally signed by Matthew
Scott Kennedy, Esq.
4 Date: 2023.09.05 10:19:31 -07'00'
By: /s/ Matthew S. Kennedy
5
MATTHEW S. KENNEDY
6 Attorney for Defendant Mechanics Bank,
successor by merger to Rabobank, N.A.
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
1 PROOF OF SERVICE
2 Elliott v. Mechanics Bank, etc., et al.
MCSC Case No. 21 CV 003944
3
4 STATE OF CALIFORNIA, COUNTY OF MONTEREY
5 I am employed in the County of San Luis Obispo, State of California. I am over the age
of 18 and not a party to the within action; my business address is Post Office Box 1031, San Luis
6 Obispo, California 93406-1031.My electronic service address is msk@KennedyLawRealty.com.
7 On September 5, 2023, I served the foregoing document described as “Defendant
Mechanics Bank’s Supplemental Brief re the Bank’s Motion For Summary Judgment” on the
8 interested parties in this action addressed as follows:
9 Nina M. Patane Attorneys for Plaintiff Robert T. Elliott
Andrea C. Avila
10 Patane Gumberg Avila, LLP
4 Rossi Circle, Ste 231
11 Salinas, CA 93907
Tel: 831.755.1461
12 Email: npatane@pglawfirm.com
aavila@pglawfirm.com
13
14 The following is the procedure in which service of this document was effected:
15 BY MAIL: I am “readily familiar” with the firm’s practice of collection and processing
correspondence for mailing. Under that practice it would be deposited with the U.S. Postal
16 Service on that same day with postage thereon fully prepaid at Carlsbad, California, in the
ordinary course of business. I am aware that on motion of the party served, service is
17 presumed invalid if postal cancellation date or postage meter date is more than one day
after date of deposit for mailing in affidavit.
18
BY E-MAIL: Pursuant to Code of Civil Procedure section 1010.6 and California
19 Rules of Court, rule 2.251, I caused this document to be transmitted via e-mail to the
e-mail address(es) listed for the addressee(s). No electronic message or other indication
20 that the transmission was unsuccessful was received within a reasonable time after the
transmission.
21
22 Executed on September 5, 2023, at San Luis Obispo, California.
23 I declare under penalty of perjury under the laws of the State of California that the above
is true and correct.
24
Digitally signed by Matthew Scott
Kennedy, Esq.
Date: 2023.09.05 10:19:50 -07'00'
25 By: Matthew S. Kennedy /s/ Matthew S. Kennedy
26 [Signed per C.R.C. 2.257 and Civ. Code § 1633.7(d).]
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DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF
RE THE BANK’S MOTION FOR SUMMARY JUDGMENT
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1 Matthew S. Kennedy – CSB No. 125620 MATTHEW S. KENNEDY, A Professional Law Corporation 2 Post Office Box 1031 San Luis Obispo, California 93406-1031 3 (805) 544-5002 / (805) 544-5003 E-Mail: msk@KennedyLawRealty.com 4 Attorneys for Defendant Mechanics Bank, 5 a California corporation, successor by merger to Rabobank, N.A. 6 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF MONTEREY 10 11 ROBERT T. ELLIOTT, CASE NO. 21 CV 003944 Assigned to: Hon. Carrie M. Panetta 12 Plaintiff, 13 vs. DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S 14 MECHANICS BANK, a California MOTION FOR SUMMARY JUDGMENT corporation, as the Successor-in-Interest to 15 Rabobank, N.A., a California corporation; RABOBANK, N.A., a California Cont. Date: September 29, 2023 16 corporation; and DOES 1 - 40, inclusive, Time: 8:30 a.m. Dept: 14 17 Defendants. 18 Complaint filed: December 20, 2021 CMC: October 31, 2023 19 Trial Date: None Assigned 20 21 22 23 Defendant Mechanics Bank, successor by merger to Rabobank, N.A., (“the Bank”) 24 submits its Supplemental Brief requested in the Court’s Tentative Ruling, dated July 20, 2023 re 25 Defendant Bank’s Motion for Summary Judgment. 26 27 28 -1- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 THE BANK’S SUPPLEMENTAL BRIEF 2 I. THE STATUTE OF LIMITATIONS BARS PLAINTIFF’S LAWSUIT. 3 The Court, in its tentative ruling, specified that a pertinent issue is the determination of 4 the date when the purported settlement agreement was breached for purposes of accrual of the 5 sole cause of action for breach of contract. Noted was paragraph BC-2 of Plaintiff’s Complaint 6 alleging that the breach occurred “on or about: April-October 2018” for “failing and continuing 7 to fail to provide Plaintiff a manner and method of payment”. Plaintiff admits in his Declaration 8 there is no mention in the purported settlement of the manner and method of payment, as well as 9 no deadline for payment instructions. As the accrual period cannot exist in perpetuity, what is a 10 “reasonable time” under the facts and circumstances? (Civ. Code, § 1657.) 11 A. Substantial Evidence Establishes the Breach of Contract Claim Accrued by 12 September 2015. 13 The statute of limitations for breach of a written contract “is four years from the time the 14 claim accrues.” (Gilkyson v. Disney Enterprises, Inc. (2016) 244 Cal.App.4th 1336, 1341.) A 15 breach of contract claim “accrues at the time of breach, which then starts the limitations period 16 running.” (Cochran v. Cochran (1997) 56 Cal.App.4th 1115, 1120; Church v. Jamison (2006) 17 143 Cal.App.4th 1568, 1583.) “[A] breach of contract ordinarily occurs upon the promisor’s 18 failure to render the promised performance.” (McCaskey v. California State Automobile Assn. 19 (2010) 189 Cal.App.4th 947, 958 [emphasis in original].) 20 Even if there is an agreement, which there is not, the Bank maintains any breach occurred 21 in September 2015 because, by that date, Plaintiff was to have made his fourth and final payment 22 under the purported settlement but had not, as he alleges the Bank did not provide him with a 23 manner and method of payment. Substantial evidence supports the September 2015 conclusion. 24 If Plaintiff’s email of January 22, 2014, with an attached proposal promising to pay $140,000 in 25 four biannual installments, and the Bank’s January 23, 2014 email it was “willing to accept” the 26 $140,000 “requir[ing] some additional review and work” is the professed settlement agreement, 27 then September 2015 is the latest date the Bank refused to perform, i.e., provide the manner and 28 method of payment. -1- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 While there is nothing in the purported “agreement” about the manner and method of 2 payment, Plaintiff emailed the Bank on April 1, 2014 – the date his first installment payment was 3 due – “want[ing] to confirm the settlement” and “if we could confirm the settlement” and if 4 Plaintiff “should deposit into an escrow account”. 1 Then absolute silence from Plaintiff through 5 his promised second installment payment, his promised third installment payment, and his 6 promised fourth installment payment in September 2015. It was not until almost four years later, 7 in February 2018, that he chose to contact the Bank. 8 Plaintiff may have had strategic personal or business reasons to refrain from filing a 9 lawsuit in September 2015 – for example, his own admission he “was on to bigger and better 10 things” 2 – but those motivations do not mean Plaintiff’s breach of contract claim did not accrue 11 by that date. Substantial evidence supports a finding that Plaintiff’s breach of contract claim 12 accrued by September 2015 and his Complaint, filed in December 2021 more than four years 13 later, is barred by the statute of limitations. (Code Civ. Proc., § 337(a).) 14 15 B. Any Accrual Arguments Past September 2015 by Plaintiff are Unavailing. 16 On the topic of accrual, the Court requests that the parties address Civil Code section 17 1657, which states: 18 If no time is specified for the performance of an act required to be performed, a reasonable time is allowed. If the act is in its nature capable 19 of being done instantly—as, for example, if it consists in the payment of money only—it must be performed immediately upon the thing to be done 20 being exactly ascertained. 21 Further, the Court “believes the case of Estate of Jones (2022) 82 Cal.App.5th 948 may be 22 helpful”. Estate of Jones involved a probate petition to enforce a stipulated judgment under Code 23 of Civil Procedure section 664.6, rather than a breach, which stipulated judgment’s express terms 24 were more delineated than the truncated emails between Plaintiff and the Bank here. 25 1 See the Bank’s Exhibit M, “Email dated April 1, 2014 from Plaintiff Robert Elliott” to the Bank in Defendant 26 Mechanics Bank’s Evidentiary Exhibits in Support of Its Motion for Summary Judgment, filed April 21, 2023 (“the 27 Bank’s Evidentiary Exhibits”). 2 See the Bank’s Exhibit R, “Deposition of Plaintiff Robert T. Elliott, 121:23-122:1”, in the Bank’s Evidentiary 28 Exhibits. -2- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 Nevertheless, by referring the parties to Estate of Jones, the Bank construes the Court as positing 2 that the “manner and method of payment” alleged in Plaintiff’s Complaint may be a condition 3 precedent that suspended the deadline for Plaintiff to perform. This line of reasoning is not 4 persuasive. 5 In its basics, Plaintiff’s Complaint alleges the parties reached a contractual settlement 6 agreement in January 2014 wherein Plaintiff would pay $140,000.00 in four installments on a 7 $3,354,371.34 Judgment entered on July 8, 2008 in Monterey County Superior Court Case No. 8 M82496 in exchange for satisfaction of Plaintiff’s obligations on the Judgment. Plaintiff is not 9 seeking to enforce the settlement contract, rather Plaintiff alleges the Bank breached the contract by 10 “failing to provide Plaintiff a manner and method of payment” of the $140,000.00 on or about “April- 11 October 2018” 3 – more than four years after Plaintiff promised to perform. In essence, under Estate 12 of Jones, an implied condition precedent to Plaintiff’s payments and, the argument would follow, that 13 because the Bank did not detail “manner and method of payment” Plaintiff’s breach of contract claim 14 could not accrue. This theory defies logic and begs the question how a plaintiff can prosecute a claim 15 that could potentially never accrue – simply by sitting back and doing nothing. 16 A “condition precedent is either an act of a party that must be performed or an uncertain 17 event that must happen before the contractual right accrues or the contractual duty arises.” (Estate 18 of Jones, supra, 82 Cal.App.5th at p. 953, citing Platt Pacific, Inc. v. Andelson (1993) 6 Cal.4th 19 307, 313.) Conditions precedent are not favored and contractual provisions will not be so 20 construed in the absence of language plainly requiring such a construction. (Helzel v. Superior 21 Court (1981) 123 Cal.App.3d 652, 663.) A court should not construe a contract as imposing a 22 condition precedent “in the absence of language plainly requiring such a construction”, such as 23 “subject to” or “conditioned on”. (Estate of Jones, supra, 82 Cal.App.5th at p. 953; Rubin v. 24 Fuchs (1969) 1 Cal.3d 50, 54; In re Marriage of Hasso (1991) 229 Cal.App.3d 1174, 1181.) 25 Courts should not “interpret a condition as a condition precedent absent clear, unambiguous 26 27 28 3 The Bank’s Exhibit T, “Complaint, filed December 20, 2021”, BC-1, BC-2”, in the Bank’s Evidentiary Exhibits. -3- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 language requiring that construction. (Estate of Jones, supra, 82 Cal.App.5th at p. 953, citing 2 Helzel v. Superior Court, supra, 123 Cal.App.3d at p. 663.) 3 Here there is no mention in the January 2014 emails that comprise the purported 4 agreement of the “manner and method of payment” as a conditional term. Plaintiff’s four 5 installment payments totaling $140,000 were not “subject to” or “conditioned upon” a “manner 6 and method of payment”. Plaintiff, by his own express proposal, was to make the four payments 7 to the Bank beginning in April 2014 and ending in September 2015. Yet, from January 23, 2014 8 through April 2018 Plaintiff never once raised a question to the Bank as to the “manner and 9 method of payment”. He testified he was busy and then just blithely moved on “to bigger and 10 better things”. Plaintiff then waited until December 2021 to file his Complaint. 11 This Court may interpret the settlement terms and conditions laid out in Plaintiff’s 12 January 21, 2014 letter to the Bank, Plaintiff’s January 22, 2014 email to the Bank, and the 13 Bank’s January 23, 2014 email to Plaintiff, “but it cannot impose terms to which the parties did 14 not agree”. (Estate of Jones, supra, 82 Cal.App.5th at p. 952, citing Weddington Productions, 15 Inc. v. Flick (1998) 60 Cal.App.4th 793, 810.) Contrary to Plaintiff’s allegations in his Complaint, 16 as well as the facts and circumstances of snubbing his purported settlement with the Bank, the 17 Court cannot now “insert in the contract language [a condition precedent] which one of the parties 18 now wishes were there”. (Estate of Jones, supra, 82 Cal.App.5th at p. 953, citing Levi Strauss & 19 Co. v. Aetna Casualty & Surety Co. (1986) 184 Cal.App.3d 1479, 1486.) 20 Meanwhile, the lack of express language as to the “manner and method of payment” 21 cannot undermine Plaintiff’s unconditional promise to pay the amount and installment terms of 22 his agreement. (McCaskey v. Calif. State Automobile Assoc. (2010) 189 Cal.App.4th 947, 958.) 23 Plaintiff could have established an escrow account as he submitted in his April 1, 2014 email to 24 the Bank 4 but he never did. He could have assigned as collateral the title to his commercial field 25 26 27 4 See the Bank’s Exhibit M, “Email dated April 1, 2014 from Plaintiff Robert Elliott” and Exhibit R, “Deposition of Plaintiff Robert T. Elliott”, 143:17-23, 144:19-22 in the Bank’s Evidentiary Exhibits. 28 -4- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 trucks as stated in his January 2014 settlement offer 5 but he did not. Plaintiff admits he could 2 have gone into a branch office to make his payments 6 but he never did. 3 Plaintiff’s delayed reliance of the “manner and method of payment” is unavailing even if 4 the purported agreement did not fix a time for the Bank to designate the “manner and method of 5 payment”. Where a contract does not fix a time for the performance of an act required to be 6 performed, a reasonable time is allowed though it may be coincidental with the statute of 7 limitations. “The law implies that a contract shall be performed within a reasonable time …. 8 Reasonable diligence and good faith must be required in such instances and it is the duty of the 9 court [to] fix a time which would be fair.” (Pitzer v. Wedel (1946) 73 Cal.App.2d 86, 91 10 [emphasis added]; Civ. Code, § 1657.) In other words, the expiration of the “reasonable time” 11 for performance triggers the start, not the end, of the statutory limitations period. 12 Plaintiff’s allegations and arguments that his breach of contract claim is postponed 13 indefinitely until he learned of the “manner and method of payment” is not persuasive. As has 14 been argued repeatedly and supported by substantial evidence in the Bank’s Motion for Summary 15 Judgment, its Reply to Plaintiff’s Opposition, and in this Supplemental Brief, Plaintiff’s waiting 16 from April 1, 2014 to April 6, 2018 to request the “manner and method of payment” is not 17 reasonable diligence and not a party to a contract acting in good faith. In no realm of “reasonable” 18 would, or should, the start of the statutory limitations period be April 2018. Especially as the 19 evidence establishes Plaintiff did absolutely nothing for the four years from April 2014 to April 20 2018 to perform his promise to pay or to urge the Bank to propose the “manner and method of 21 payment”. 22 ‘Statute of limitations’ is the ‘collective term ... commonly applied to a great number of acts,’ or parts of acts, that ‘prescribe the periods beyond 23 which’ a plaintiff may not bring a cause of action. It has as a purpose to protect defendants from the stale claims of dilatory plaintiffs. It has as a 24 related purpose to stimulate plaintiffs to assert fresh claims against defendants in a diligent fashion. Inasmuch as it ‘necessarily fix[es]’ a 25 5 See the Bank’s Exhibit F, “Email dated January 22, 2014 from Plaintiff Robert Elliott” to the Bank with Plaintiff’s 26 settlement offer and Exhibit R, “Deposition of Plaintiff Robert T. Elliott”, 144:25-145:4, in the Bank’s Evidentiary 27 Exhibits. 6 See the Bank’s Exhibit R, “Deposition of Plaintiff Robert T. Elliott, 134:12-21, 137:13-20, 138:22-139:11”, in 28 the Bank’s Evidentiary Exhibits. -5- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 ‘definite period [] of time’ ... it operates conclusively across the board, and not flexibly on a case-by-case basis. 2 (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 395-396 [internal citations 3 omitted].) 4 5 II. THE DOCTRINE OF EQUITABLE ESTOPPEL DOES NOT APPLY. 6 A further issue to be addressed per the Court’s tentative ruling is the issue of equitable 7 estoppel. The Court asks, “if the breach of contract occurred more than four years before the 8 complaint was filed, should [the Bank] be estopped from relying upon the defense of the statute 9 of limitations?” Even with the Bank’s consistent contention that no contract was created in 10 January 2014, substantial evidence establishes Plaintiff did not reasonably rely on any statement 11 made by the Bank. Hence, the Bank is not equitably estopped from asserting a statutory 12 limitations period. 13 A. The Evidence Demonstrates That Equitable Estoppel Is Not Justified to Bar 14 the Bank’s Statute of Limitations Defense. 15 In appropriate cases, a defendant may be equitably estopped from asserting a statutory 16 limitations period. Equitable estoppel empowers a court to allow a plaintiff to proceed with a 17 time-barred claim because the defendant has engaged in unjust conduct. The burden of proof to 18 establish equitable estoppel lies with the plaintiff. (Lantzy v. Centrex Homes (2003) 31 Cal.4th 19 363, 383; Doe v. Marten (2020) 49 Cal.App.5th 1022, 1027.) 20 An aspect of equitable estoppel is codified in Evidence Code section 623 which, with its 21 annotations, provides that “[w]henever a party has, by his own statement or conduct, intentionally 22 and deliberately led another to believe a particular thing true and to act upon such belief, he is 23 not, in any litigation arising out of such statement or conduct, permitted to contradict it.” 24 (Emphasis added.) In most cases, a plaintiff pleads the prerequisites of equitable estoppel to 25 sidestep any statute of limitations defenses (which Plaintiff did not do here). The court then 26 assesses whether the defendant’s conduct actually and reasonably persuaded plaintiff to forbear 27 suing within the limitations period. Additionally, the court must evaluate whether a plaintiff’s 28 -6- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 detrimental reliance was reasonable. (Lantzy v. Centrex Homes, supra, 31 Cal.4th at p. 385; 2 Munoz v. State of California (1995) 33 Cal.App.4th 1767, 1785.) 3 Accordingly, (1) if one potentially liable represents, while the limitations period is still 4 running, that all actionable damage has been or will be averted, thus making it unnecessary to 5 sue, (2) the plaintiff reasonably relies on the defendant’s representation to refrain from bringing 6 a timely action, (3) the representation proves false after the limitations period has expired, and 7 (4) the plaintiff proceeds diligently once the truth is discovered, the defendant may be equitably 8 estopped to assert the statute of limitations as a defense to the action. (Lantzy v. Centrex Homes, 9 supra, 31 Cal.4th at p. 384; see also Vu v. Prudential Property & Casualty Ins. Co. (2001) 26 10 Cal.4th 1142, 1153.) 11 In Salmons v. Jameson (1956) 144 Cal.App.2d 698, referenced by this Court, the 12 plaintiffs brought an action for specific performance and to quite title on a written contract for 13 the purchase of a ranch of 930 acres of which 30 acres would be deeded back to plaintiffs by the 14 defendants. The defendants conceded that under the land sale contract the plaintiffs “had a perfect 15 right to live” on the property and “to build their home there”. The plaintiffs constructed a house 16 on the 30 acres, made improvements to the water system to the property, and built a road leading 17 from the county road to the house – all with defendants’ knowledge and with no objections by 18 defendants. (Id. at pp. 699-700.) Meanwhile, for those eight years the plaintiffs repeatedly asked 19 defendants for the promised deed to the 30 acres, which defendants “stalled” off on. Finally, after 20 eight years, plaintiffs “demanded” the deed and defendants for the first time claimed that 21 plaintiffs “had only a ‘life lease’” and refused to give plaintiffs a deed to the 30 acres. (Id. at p. 22 701.) When plaintiffs filed suit, defendants raised the statute of limitations as a defense. 23 In affirming the trial court’s ruling that the statute of limitations did not bar plaintiffs’ 24 claims, the appellate court held that “it is well settled that a person by his conduct may be 25 estopped to rely upon” the defenses of laches or the statute of limitations “where the delay in 26 commencing action is induced by the conduct of the defendant”. (Salmons v. Jameson, supra, 27 144 Cal.App.2d at p. 705.) “In the instant case the evidence shows that [plaintiffs] repeatedly 28 asked for a deed to the property and that [defendants] ‘stalled it off’ and that [defendants’] refusal -7- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 to execute a deed was not made until [eight years later]. (Ibid.) In other words, the defendants’ 2 continual stalling to plaintiffs’ continual inquiries were false representations. And, when 3 defendants finally flat out refused to provide the deed, which was after the limitations period ran 4 out, the defendants were then estopped from raising the statute of limitations defense. 5 The Bank contends that Salmons is so factually distinguishable from Plaintiff’s facts and 6 circumstances as to not be applicable. Here, Plaintiff did not repeatedly ask the Bank for a 7 “manner and method of payment” or demand that the Bank proceed with the next steps to execute 8 the purported settlement agreement. In fact, Plaintiff admittedly walked away from the alleged 9 settlement for four years, never performing or attempting to perform his promises of payment. 10 Moreover, the Bank made no representations to Plaintiff, whether false or true, that there was 11 even a contractual settlement agreement, let alone, never once making any reference to a “manner 12 and method of payment”. The Bank fails to see how the doctrine of equitable estoppel under 13 Salmons applies. 14 The Bank’s contention is further supported by more recent case law. In Lantzy v. Centex 15 Homes, supra, a construction defect case where the plaintiffs waited to file suit until after the 10- 16 year statute of limitations period of Code of Civil Procedure section 337.15, the California 17 Supreme Court ruled that the plaintiffs’ efforts to plead around the limitations period was 18 insufficient to equitably estop the defendant from raising the statute of limitations as a viable 19 affirmative defense. Although the matter was decided on defendant’s demurrer, the California 20 Supreme Court’s holding in Lantzy is applicable here. 21 The plaintiffs in Lantzy contended that “at various times [d]efendants have attempted to 22 make repairs … or advised [p]laintiffs that the defective windows were not defective and not to 23 file a lawsuit” and thus the defendants were “estopped to assert” a statute of limitations 24 affirmative defense. (Lantzy v. Centrex Homes, supra, 31 Cal.4th at p. 385.) The California 25 Supreme Court held that the complaint was devoid of any indication, let alone evidentiary facts, 26 that the defendant’s conduct “actually and reasonably” persuaded plaintiffs to hold back from 27 suing. Moreover, there were no “suggestions” by defendant that the alleged repair attempts would 28 have precluded plaintiff from filing a lawsuit. Nothing in defendant’s conduct prevented the -8- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 plaintiffs from challenging defendant’s representations and filing a timely lawsuit. (Ibid.) The 2 plaintiffs chose not to file suit within the limitations period. 3 In Doe v. Marten, supra, a medical malpractice action, the plaintiff patient did not timely 4 file a lawsuit because she relied on defendant doctor’s agreeing to plaintiff’s arbitration demand, 5 even though the defendant doctor was not a signatory on the arbitration agreement. The trial court 6 found the malpractice claim time-barred and dismissed the action. The plaintiff patient appealed 7 on the grounds the defendant doctor was equitably estopped from asserting the statute of 8 limitations defense. (Doe v. Marten, supra, 49 Cal.App.5th at pp. 1024-1025.) 9 The First District Court of Appeal, relying on Lantzy v. Centex Homes, held that in the 10 statute of limitations context, equitable estoppel is only appropriate where the defendant’s act or 11 omission actually and reasonably persuaded the plaintiff to refrain from filing a timely lawsuit. 12 “The requisite act or omission must involve a misrepresentation or nondisclosure of a material 13 fact bearing directly on the necessity of bringing a timely suit.” (Doe v. Marten, supra, 49 14 Cal.App.5th at p. 1028.) “The salient fact is that defendant responded to plaintiff’s arbitration 15 demand in a manner so as to induce plaintiff to reasonably and in good faith proceed with 16 arbitration instead of filing a legal action.” (Id. at p. 1030.) It was not until defendant doctor 17 belatedly challenged the arbitration demand, which demand was timely served, that plaintiff 18 promptly filed her civil action albeit beyond the limitations period. (Id. at p. 1032.) 19 Here, there is no issue of material fact establishing that Plaintiff refrained from filing a 20 timely suit in reasonable reliance for the Bank’s not advising Plaintiff the “manner and method 21 of payment” as alleged in Plaintiff’s Complaint. Not once from April 1, 2014 through September 22 1, 2015 did Plaintiff ask the Bank for the “manner and method of payment”. Instead, Plaintiff 23 unreasonably sat on his hands until April 2018 when he inquired of the Bank’s attorney how to 24 make the installment payments that were due between April 2014 and September 2015. This was 25 four years after the payments were due. 26 There is no evidence that the Bank made any representations, misrepresentations, or 27 nondisclosures of a material fact on the necessity of Plaintiff to bring a timely lawsuit to enforce 28 a settlement agreement that only Plaintiff believed existed. Nor is there evidence, as required -9- DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 under the law, that the Bank made any representations or misrepresentations to dissuade Plaintiff 2 from bringing a lawsuit. 3 Plaintiff alleges in his Complaint that the Bank breached the contract by “failing to provide 4 Plaintiff a manner and method of payment” of the $140,000.00 on or about “April-October 2018”. 7 5 The Bank posits the allegation is disingenuous as the installment payments were due from April 2014 6 through September 2015 – not in the contrived time period of “April-October 2018”. Nevertheless, 7 Plaintiff did nothing for four years to meet his obligations and, to repeat, the Bank made no 8 representations, misrepresentations, or nondisclosures to prevent Plaintiff from filing suit. 9 To complicate matters, and in direct contravention of the allegations in his Complaint, 10 Plaintiff proffers his declaration in opposition to the Bank’s summary judgment motion now 11 claiming the statute of limitations did not begin to run until April 2018 when the Bank, ostensibly 12 for the first time, denied there was an enforceable settlement agreement. 8 Rather, as Plaintiff 13 always knew, the emails of January 2014 were an “agreement to agree” to continued settlement 14 negotiations requiring “additional review and work with both the SBA and Central Coast 15 SBDC”. 9 16 In other words, there is no evidence the Bank’s conduct actually and reasonably 17 persuaded Plaintiff not to sue for enforcement or breach of the purported settlement agreement. 18 There is also no evidence of any detrimental reliance by Plaintiff that was in any way, shape, or 19 form, reasonable. In fact, there is no evidence whatsoever, let alone substantial evidence, that the 20 doctrine of equitable estoppel should preclude the Bank from asserting the statute of limitations 21 as an affirmative defense. 22 23 24 7 See the Bank’s Exhibit T, “Complaint, filed December 20, 2021”, BC-1, BC-2”, in the Bank’s Evidentiary 25 Exhibits. 26 8 See Declaration of Robert T. Elliott in Support of Opposition” to the Bank’s Motion for Summary Judgment, 27 dated July 6, 2023, ¶¶ 36, 37. 9 See the Bank’s Exhibit F, “Email dated January 22, 2014 from Plaintiff Robert Elliott” to the Bank with Plaintiff’s 28 settlement offer and Exhibit H, “Email dated January 23, 2014 from Frank Oliver” to Plaintiff. - 10 - DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 Respectfully submitted, 2 Dated: September 5, 2023 MATTHEW S. KENNEDY, A Professional Law Corporation 3 Digitally signed by Matthew Scott Kennedy, Esq. 4 Date: 2023.09.05 10:19:31 -07'00' By: /s/ Matthew S. Kennedy 5 MATTHEW S. KENNEDY 6 Attorney for Defendant Mechanics Bank, successor by merger to Rabobank, N.A. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 11 - DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT 1 PROOF OF SERVICE 2 Elliott v. Mechanics Bank, etc., et al. MCSC Case No. 21 CV 003944 3 4 STATE OF CALIFORNIA, COUNTY OF MONTEREY 5 I am employed in the County of San Luis Obispo, State of California. I am over the age of 18 and not a party to the within action; my business address is Post Office Box 1031, San Luis 6 Obispo, California 93406-1031.My electronic service address is msk@KennedyLawRealty.com. 7 On September 5, 2023, I served the foregoing document described as “Defendant Mechanics Bank’s Supplemental Brief re the Bank’s Motion For Summary Judgment” on the 8 interested parties in this action addressed as follows: 9 Nina M. Patane Attorneys for Plaintiff Robert T. Elliott Andrea C. Avila 10 Patane Gumberg Avila, LLP 4 Rossi Circle, Ste 231 11 Salinas, CA 93907 Tel: 831.755.1461 12 Email: npatane@pglawfirm.com aavila@pglawfirm.com 13 14 The following is the procedure in which service of this document was effected: 15 BY MAIL: I am “readily familiar” with the firm’s practice of collection and processing correspondence for mailing. Under that practice it would be deposited with the U.S. Postal 16 Service on that same day with postage thereon fully prepaid at Carlsbad, California, in the ordinary course of business. I am aware that on motion of the party served, service is 17 presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit. 18 BY E-MAIL: Pursuant to Code of Civil Procedure section 1010.6 and California 19 Rules of Court, rule 2.251, I caused this document to be transmitted via e-mail to the e-mail address(es) listed for the addressee(s). No electronic message or other indication 20 that the transmission was unsuccessful was received within a reasonable time after the transmission. 21 22 Executed on September 5, 2023, at San Luis Obispo, California. 23 I declare under penalty of perjury under the laws of the State of California that the above is true and correct. 24 Digitally signed by Matthew Scott Kennedy, Esq. Date: 2023.09.05 10:19:50 -07'00' 25 By: Matthew S. Kennedy /s/ Matthew S. Kennedy 26 [Signed per C.R.C. 2.257 and Civ. Code § 1633.7(d).] 27 28 - 12 - DEFENDANT MECHANICS BANK’S SUPPLEMENTAL BRIEF RE THE BANK’S MOTION FOR SUMMARY JUDGMENT