Hotton v. L & S Land Co.

• Court: District Court, N.D. California
• Decided: December 9, 2019
• Docket: 3:19-cv-05500
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 MARK HOTTON, Case No. 19-cv-05500-SI

8 Plaintiff, ORDER TO SHOW CAUSE RE. 9 v. CONTEMPLATED DISMISSAL

10 L & S LAND CO., et al., Re: Dkt. No. 1 11 Defendants.

12 13 Mark Hotton, an inmate currently incarcerated at the Federal Correctional Institution – Fort 14 Dix in New Jersey, filed this pro se civil action and applied to proceed in forma pauperis. The 15 complaint is now before the court for review pursuant to 28 U.S.C. § 1915. 16 17 BACKGROUND 18 The complaint is dated October 9, 2018, and was sent to the court in an envelope in which 19 there also was a certificate of service and enclosure letter dated August 12, 2019. The complaint 20 was stamped filed on August 30, 2019. Under the prisoner mailbox rule, the complaint is deemed 21 filed as of the date a pro se prisoner gives a document to prison officials to mail to the court. Douglas 22 v. Noelle, 567 F.3d 1103, 1108-09 (9th Cir. 2009). The court assumes for present purposes that 23 Hotton gave the envelope to prison officials to mail to the court on the day he signed the certificate 24 of service and enclosure letter, and deems the complaint to have been filed on August 12, 2019. 25 The complaint alleges a breach of contract. Hotton allegedly loaned to defendants $100,000 26 at 10% interest on May 5, 2005, with the loan being due and payable at the expiration of a 12-month 27 period. Docket No. 1 at 2. (A promissory note dated May 5, 2005, apparently bearing the signature 1 signature line for Defendant Albert Laudel is attached to the complaint. Docket No. 1 at 4.) 2 Defendants allegedly “continuously promised to satisfy the promissory note, misleading Plaintiff 3 that note would be satisfied up & through October 12, 2012 and again in 2013.” Id. at 2-3. 4 Defendants allegedly have made no payments of principal or interest on the note and therefore are 5 in default. Id. at 3. 6 Hotton invokes the court’s diversity jurisdiction because he is a resident of New York and 7 the other defendants reside in California. See 28 U.S.C. § 1332(a) (court has jurisdiction over a civil 8 action where the matter in controversy exceeds $75,000 and the action is between citizens of 9 different States). 10 11 DISCUSSION 12 In an action in which a plaintiff seeks to proceed in forma pauperis, a district court may 13 screen the complaint to fulfill its duty under 28 U.S.C. § 1915(e)(2)(B), which requires the court to 14 dismiss a case if the court determines that the action is frivolous or malicious, fails to state a claim, 15 or seeks monetary relief against a defendant who is immune from such relief. Pro se pleadings must be liberally construed. See Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). 16 To state a breach of contract cause of action in California, a plaintiff must allege “(1) the 17 existence of the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's 18 breach, and (4) the resulting damages to the plaintiff.” Oasis West Realty, LLC v. Goldman, 51 19 Cal.4th 811, 821 (Cal. 2011). 20 Plaintiffs are required to file their claims within certain time limits, or forever lose the right 21 to enforce the right to assert the claims. Those time limits are set out in statutes of limitations, such 22 as California’s four-year statute of limitations for actions for breach of contract. There appears to 23 be a statute of limitations problem for Hotton. 24 Under California law, an action upon a “contract, obligation or liability founded upon an 25 instrument in writing” must be brought within four years. Cal. Code Civ. Proc. § 337(a). Generally, 26 the limitations period “runs from the moment a claim accrues.” Aryeh v. Canon Business Solutions, 27 Inc., 55 Cal. 4th 1185, 1191 (Cal. 2013). California follows the “‘last element’” accrual rule, which 1 provides that the statute of limitations period starts upon the occurrence of the last element essential 2 to the cause of action. See id. at 1191. The essential elements for purposes of determining the 3 accrual date are “‘wrongdoing, harm, and causation.’” See id. 4 Some events can cause a delay in the start of the limitations period or in the deadline to get 5 to court. Incarceration of the plaintiff is a disability that may toll the statute for a maximum of two 6 years, but only for a plaintiff who is in prison “for a term less than for life” and is under the disability 7 at the time the cause of action accrues. See Cal. Civ. Proc. Code § 352.1. 8 The commencement of the limitation period also may be delayed under the discovery rule 9 which, when applicable, “‘postpones accrual of a cause of action until the plaintiff discovers, or has 10 reason to discover, the cause of action.’” Aryeh, 55 Cal. 4th at 1192. 11 The limitations period also is subject to equitable tolling, which “‘reliev[es] plaintiff from 12 the bar of a limitations statute when, possessing several legal remedies he, reasonably and in good 13 faith, pursues one designed to lessen the extent of his injuries or damage.’” Cervantes v. City of San 14 Diego, 5 F.3d 1273, 1275 (9th Cir. 1993) (quoting Addison v. California, 21 Cal. 3d 313, 317 15 (1978)). Thus, in an appropriate case, the statute of limitations might be tolled for time spent 16 pursuing a remedy in another forum before filing the claim in federal court. 17 Although the statute of limitations is an affirmative defense that normally may not be raised 18 by the court sua sponte, it may be grounds for sua sponte dismissal of an in forma pauperis complaint 19 where the defense is complete and obvious from the face of the pleadings or the court's own records. 20 See Franklin v. Murphy, 745 F.2d 1221, 1228-30 (9th Cir. 1984). That is the situation here: the 21 defense appears complete and obvious from the face of the complaint because this action was filed 22 more than thirteen years after the purported breach of contract occurred. The promissory note was 23 dated May 5, 2005, and called for repayment within a year, or by May 5, 2006. Under the normal 24 four-year limitations period, the deadline to file the action for breach of contract would have been 25 in May 2010, yet Hotton did not file his federal action until more than nine years later, in August 26 2019. That is far beyond the four-year limitation period for bringing a breach of contract action. 27 And, although Hotton is now incarcerated, he may not have been incarcerated at the time the cause 1 Code of Civil Procedure § 352.1. Even if he was incarcerated at the time the cause of action accrued, 2 || the two years of tolling under § 352.1 would not extend his deadline by enough time to make the 3 complaint timely. Hotton must explain why his complaint should not be dismissed as time-barred. 4 5 CONCLUSION 6 Because the statute of limitations problem appears complete and obvious from the face of 7 the complaint, Hotton is now ORDERED TO SHOW CAUSE why his complaint is not barred by 8 the statute of limitations. He must submit any argument he has to show that the statute of limitations 9 does not bar his claim that defendants breached the May 5, 2005, promissory note. Plaintiff must 10 || file his written response no later than January 10, 2020. Failure to file the written response to the 11 order to show cause will result in the dismissal of this action. 12 IT IS SO ORDERED. 5 13 || Dated: December 9, 2019 Site WU tee OM VON SUSAN ILLSTON United States District Judge 16

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