If a plaintiff wishes to file a lawsuit stemming from a
breach of contract, California law requires that the plaintiff files the suit within a specific
period of time after the defendant’s alleged breach. In breach of
contract cases, the first place the defendant’s attorney will look
is to the state’s statute of limitations.
If the defendant can show that the statute of limitations has expired,
the plaintiff shall be barred from filing a lawsuit. California’s
laws specify statute of limitation periods for oral contracts and written
Breach of an Oral Contract
California Code of Civil Procedure Section 339 establishes a two-year statute
of limitations for oral contracts. While this section applies to “oral
contracts,” even most oral contracts include some type of written
material; for example, a cancelled check, a receipt, or other proof that
the parties had an oral contract.
Contracts in Writing
Under Section 337 of the California Code of Civil Procedure, the more generous
statute of limitations for filing a lawsuit is four-years for written
contracts. Section 339, however, establishes a two-year statute of limitations
for certain written contracts pertaining to real estate titles and title
Tolling of California’s Statute of Limitations
In some cases, the statute of limitations can be suspended “tolled”
for a specific period of time. In such cases, the statute of limitations
will be paused, and shall begin running again.
To illustrate, under Section 351 of California’s Code of Civil Procedure,
if a cause of action has accrued against an individual and he or she is
out of state, the action may be put on hold until their return. In such
cases, the defendant’s time of absence will not be a part of the
time limited to file a lawsuit.
Additionally, Section 352(a) of the Code of Civil Procedure states that
if a person has the right to bring an action, and at the time the cause
of action accrued the defendant was a minor or lacked the legal capacity
to make decisions, then the time that they were disabled would not be
part of the time limited to begin a legal action against them.
It is important to note that contracting parties in California are allowed
to include a term in their contract that shortens California’s statute
of limitation period.
If a written contract provides a provision that shortens the statute of
limitations and it is reasonable and valid, the shorter period should
still provide plenty of time to pursue a judicial remedy in a breach of
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