Garrison v. OneWest Bank CA1/1

Filed 11/27/13 Garrison v. OneWest Bank CA1/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION ONE

ANN GARRISON, Plaintiff and Appellant, A136390 v. ONEWEST BANK, FSB, et al., (San Francisco City & County Super. Ct. No. CGC-09-491020) Defendants and Respondents.

Plaintiff Ann Garrison sued several defendants involved in the foreclosure of a mortgage on her residence. Ultimately, the trial court sustained a demurrer without leave to amend to the sole claim of her sixth amended complaint, finding the claim barred by the statute of limitations. We affirm. I. BACKGROUND Garrison filed suit against defendants on August 3, 2009, alleging causes of action for negligence, breach of contract, fraud, and other theories in connection with the foreclosure on her residential mortgage. After a series of demurrers by defendants, Garrison filed her sixth amended complaint (complaint) on January 26, 2012. The complaint alleged Garrison had purchased a home in San Francisco in 1998. In 2005, she refinanced. At some point in 2008, foreclosure proceedings were instituted, but Garrison was able to pay the amount demanded. In December of that year, however, defendants demanded much larger payments, and Garrison ultimately lost the home to foreclosure. In the complaint’s only cause of action, for breach of contract, Garrison alleged that although the promissory note carried an initial interest rate of 1 percent, the interest

rate became variable after May 1, 2005, adjustable monthly. The variable interest rate was to be determined on the basis of an index calculated according to “the twelve month average of monthly yields on actively traded United States Treasury Securities, adjusted to a constant maturity of one year.” The note stated this index was published monthly in “Federal Reserve Statistical Release G13.” Under the terms of the note, if that index became “no longer available,” the note holder was entitled to choose a new index “based upon comparable information,” with notice to the promisor. Garrison alleged the Federal Reserve had discontinued the specified index in 2002 and she had never been given notice of a substitute. As a result, she alleged, “Defendants never had any basis for calculating an interest change from the initial 1% rate.” Defendants filed a demurrer arguing the complaint was barred by the statute of limitations for actions on a written contract, since her original complaint had not been filed until more than four years after May 1, 2005, when the variable interest rate became effective. (Code Civ. Proc., § 337, subd. (1).) In her opposition, Garrison explained she first discovered the discontinuance of the Federal Reserve index after she read a real estate law guide book while preparing to file this action in 2009. The guide book suggested investigating whether the borrower’s interest rate had been properly calculated. When Garrison looked for the index, she discovered it had been discontinued.1 The trial court sustained the demurrer without leave to amend, explaining in its order, “Plaintiff’s sole cause of action for breach of contract is barred by the applicable statue [sic] of limitations and Plaintiff has failed to plead sufficient facts to show her entitlement to tolling, even though she was previously given a leave to amend to address this deficiency.” II. DISCUSSION Arguing several theories, Garrison contends the trial court erred in finding her action barred by the statute of limitations.