Judge: Lee W. Tsao, Case: 22NWCV01478, Date: 2023-05-09 Tentative Ruling

Case Number: 22NWCV01478    Hearing Date: May 9, 2023    Dept: C

SWANSON, et al. v. KHAMIS

CASE NO.:  22NWCV01478

HEARING:  5/9/23 @ 1:30 PM

 

#10

TENTATIVE RULING

 

Defendant Khamis’s demurrer to Plaintiff’s complaint is SUSTAINED with 10 days leave to amend. 

 

Moving Party to give NOTICE.

 

 

Defendant Khamis demurs to the 1st cause of action ground that the claims fail to state facts sufficient to constitute a cause of action. 

 

Plaintiffs Michele Swanson and Michael Sawa allege that they made a Creditor’s Claim in Estate of Candie Ellen Antonia Shelton, case number 22STPB01394, based on two promissory notes dated August 21, 2016.  (Complaint, ¶¶ 1, 4-5.)  “The principal amount of the first Promissory Note is Sixty Thousand Dollars ($60,000) in interest only installments at eight percent (8%) interest per annum, payable in monthly installments of Four Hundred Dollars ($400) beginning August 21, 2016, and continuing monthly thereafter for a period of twenty-four (24) months at which time the unpaid balance was immediately due and payable. The note became fully due and payable August 21, 2018.”  (Id., ¶ 7.)  “The principal amount of the second Promissory Note is Sixty Thousand Dollars ($60,000) in interest only installments at ten percent (10%) interest per annum, payable in monthly installments of Five Hundred Dollars ($500) beginning August 21, 2016, and continuing monthly thereafter for a period of twenty-four (24) months at which time the unpaid balance was immediately due and payable. The note became fully due and payable August 21, 2018.”  (Id., ¶ 8.)  “After the “borrower” Mark L. Shelton, passed away, Decedent reaffirmed the debts by continuing to make the monthly interest-only payments. Upon Decedent’s passing, all payments stopped. The debts were incurred during the marriage of Decedent and her spouse, Mark Shelton, and are deemed community property debts.”  (Id., ¶ 9.)  Based thereon, the Complaint asserts a single cause of action for Rejected Creditor’s Claim.

1st CAUSE OF ACTION

 

REJECTED CREDITOR’S CLAIM:

 

It appears that there are two time limits associated with a creditor’s claim.  Prob. Code § 9100 governs the time period in which a creditor must file its “claims,” while CCP § 366.2 governs the statute of limitations for “actions” brought against a deceased.

 

Claims: 

 

“(a) A creditor shall file a claim before expiration of the later of the following times:  (1) Four months after the date letters are first issued to a general personal representative.  (2) Sixty days after the date notice of administration is mailed or personally delivered to the creditor.  Nothing in this paragraph extends the time provided in Section 366.2 of the Code of Civil Procedure.  (b) A reference in another statute to the time for filing a claim means the time provided in paragraph (1) of subdivision (a).  (c) Nothing in this section shall be interpreted to extend or toll any other statute of limitations or to revive a claim that is barred by any statute of limitations. The reference in this subdivision to a “statute of limitations” includes Section 366.2 of the Code of Civil Procedure.”  (Prob. Code § 9100.)

 

Defendant contends that letters of administration were issued on April 8, 2022, citing Defendant’s Rejection of Plaintiff’s creditor’s claim.  (RJN, Ex. B.)  While judicial notice is taken of Defendant’s Rejection, judicial notice is not taken of the actual date the letters of administration were issued.  There is no judicially noticeable evidence before this court of the date the letters were actually issued, nor is this date alleged within the four corners of the complaint. 

 

Regardless, even the letters were issued on April 8, 2022, Plaintiffs allege at ¶ 4 that they filed a creditor’s claim on August 5, 2022.  The creditor’s “claim” appears to be timely.

 

Statute of Limitations:

 

The statute of limitations for Plaintiffs’ “action” is governed by CCP § 366.2, which provides, “(a) If a person against whom an action may be brought on a liability of the person, whether arising in contract, tort, or otherwise, and whether accrued or not accrued, dies before the expiration of the applicable limitations period, and the cause of action survives, an action may be commenced within one year after the date of death, and the limitations period that would have been applicable does not apply.  (b) The limitations period provided in this section for commencement of an action shall not be tolled or extended for any reason except as provided in… (2) Part 4 (commencing with Section 9000) of Division 7 of the Probate Code (creditor claims in administration of estates of decedents).”  (CCP § 366.2.)

 

Here, the borrower, Mark Shelton, died on October 4, 2020.  (RJN, Ex. C.)  His wife, Candie Shelton, continued making the loan payments until her death on July 13, 2021.  (Complaint, ¶ 9; RJN, Ex. D.)  The instant complaint was filed on December 2, 2022, which is more than one year after Candie Shelton’s death.  The action is untimely.

 

Plaintiffs argue that the four-year statute of limitations pursuant to CCP § 337 did not begin to run until Defendant’s breach, which was a month after the death of Candie Shelton.  (Opposition, 2:24.)  However, CCP § 366.2, which governs the statute of limitations against deceased individuals explicitly states that the statute applies” whether accrued or not accrued” and “the limitations period that would have been applicable does not apply.”

 

Plaintiffs alternatively argue that CCP § 366.2 is inapplicable because there is no evidence or allegation that Defendant mailed or personally delivered a “notice of administration” pursuant to Prob. Code 9100.  However, Prob. Code 9100 provides that “[n]othing in this paragraph extends the time provided in Section 366.2 of the Code of Civil Procedure.”

 

The court notes that CCP § 366.2(b) provides that the limitations period may be tolled or extended under certain statutes.  This court expresses no opinion regarding whether any such statute applies to the instant case.  Leave to amend will be granted to allege any facts or circumstance that may support tolling.

 

Accordingly, the demurrer is SUSTAINED with 10 days leave to amend.