How long is the limitations period on this written contract, and can the contract change it?
Four years for an action upon any contract, obligation or liability founded upon an instrument in writing (Code Civ. Proc. § 337(a)), except as provided in § 336a, which gives SIX years for an action upon bonds, notes or debentures issued by a corporation and issued to or held by the public, or upon the mortgage, trust deed or other agreement under which they were issued; and § 337(a)'s own proviso confines an action for a money judgment for the balance due, after exercise of a power of sale in a deed of trust or mortgage on real property, to three months after the sale. As to EXTENDING it, the contract cannot do so open-endedly: no waiver bars the limitations defence unless it is in writing and signed by the person obligated; a waiver executed before the period expires is effective for no more than four years from the date the period expires, one executed afterwards for no more than four years from its own date, and such waivers may be renewed for further periods of not more than four years each (§ 360.5). Section 337 has two more clocks: four years for a book account, an account stated in writing, or a mutual open and current account, running from the last item (§ 337(b)); and four years for an action based on the RESCISSION of a written contract, running from the facts that entitle the party to rescind, or, where the ground is fraud or mistake, from their discovery (§ 337(c)). The period is extended only under § 360: no acknowledgment or promise takes the case out of the statute unless it is in a writing signed by the party to be charged, though a payment of principal or interest on a promissory note restarts the period on that note as each payment is made, and no payment revives a cause of action once barred. A contract NOT founded on a writing gets two years (§ 339(1)), and a contract for the sale of goods four years under Commercial Code § 2725, which the parties may reduce by original agreement to not less than one year but may not extend, accruing on breach regardless of knowledge and, for warranty, on tender of delivery unless the warranty explicitly extends to future performance of the goods and discovery of the breach must await that performance, in which case it accrues when the breach is or should have been discovered.
The trap
A tolling or 'the parties agree not to plead the statute of limitations' clause signed at the outset is not a permanent extension: it is a four-year waiver that must be signed by the obligor and then RENEWED, and an unsigned or unrenewed one leaves the defence intact. Note also § 337(d): once the period has run on a debt, a person shall not bring suit or initiate an arbitration or other proceeding to collect it, and the period may be extended only pursuant to § 360. And the goods contract is the exception to the § 360.5 route: Commercial Code § 2725 says in terms the parties "may not extend" its four years, so a tolling waiver that would work on a services agreement does not lengthen the sale-of-goods period, while § 2725 expressly permits the parties, by original agreement, to reduce its four years to not less than one year: a permission § 337 does not state, and a clause shortening the period is a different question from § 360.5's waiver cap: parties may agree, in an arbitration agreement or otherwise, to shorten the limitations period applicable to a claim, but the shortened period must be reasonable, and in Jenkins a one-year cut imposed on a four-year statutory claim was not.
10 authorities
- statuteCal. Civ. Proc. Code § 337enactment date not established
The words that state the rule
Within four years: (a) An action upon any contract, obligation or liability founded upon an instrument in writing, except as provided in Section 336a; provided, that the time within which any action for a money judgment for the balance due upon an obligation for the payment of which a deed of trust or mortgage with power of sale upon real property or any interest therein was given as security, following the exercise of the power of sale in such deed of trust or mortgage, may be brought shall not extend beyond three months after the time of sale under such deed of trust or mortgage.
- statuteCal. Civ. Proc. Code § 360.5enactment date not established
The words that state the rule
No waiver shall bar a defense to any action that the action was not commenced within the time limited by this title unless the waiver is in writing and signed by the person obligated. No waiver executed prior to the expiration of the time limited for the commencement of the action by this title shall be effective for a period exceeding four years from the date of expiration of the time limited for commencement of the action by this title and no waiver executed after the expiration of such time shall be effective for a period exceeding four years from the date thereof, but any such waiver may be renewed for a further period of not exceeding four years from the expiration of the immediately preceding waiver. Such waivers may be made successively. The provisions of this section shall not be applicable to any acknowledgment, promise or any form of waiver which is in writing and signed by the person obligated and given to any county to secure repayment of indigent aid or the repayment of moneys fraudulently or illegally obtained from the county.
- statuteCal. Civ. Proc. Code § 336aenactment date not established
The words that state the rule
Within six years: (a) An action upon any bonds, notes, or debentures issued by any corporation or pursuant to permit of the Commissioner of Financial Protection and Innovation, or upon any coupons issued with the bonds, notes, or debentures, if those bonds, notes, or debentures shall have been issued to or held by the public. (b) An action upon any mortgage, trust deed, or other agreement pursuant to which the bonds, notes, or debentures were issued. This section does not apply to bonds or other evidences of indebtedness of a public district or corporation.
- statuteCal. Civ. Proc. Code § 337enactment date not established
The words that state the rule
(c) An action based upon the rescission of a contract in writing. The time begins to run from the date upon which the facts that entitle the aggrieved party to rescind occurred. Where the ground for rescission is fraud or mistake, the time shall not begin to run until the discovery by the aggrieved party of the facts constituting the fraud or mistake. Where the ground for rescission is misrepresentation under Section 359 of the Insurance Code, the time shall not begin to run until the representation becomes false.
- statuteCal. Civ. Proc. Code § 337enactment date not established
The words that state the rule
(d) When the period in which an action must be commenced under this section has run, a person shall not bring suit or initiate an arbitration or other legal proceeding to collect the debt. The period in which an action may be commenced under this section shall only be extended pursuant to Section 360.
- statuteCal. Civ. Proc. Code § 360enactment date not established
The words that state the rule
No acknowledgment or promise is sufficient evidence of a new or continuing contract, by which to take the case out of the operation of this title, unless the same is contained in some writing, signed by the party to be charged thereby, provided that any payment on account of principal or interest due on a promissory note made by the party to be charged shall be deemed a sufficient acknowledgment or promise of a continuing contract to stop, from time to time as any such payment is made, the running of the time within which an action may be commenced upon the principal sum or upon any installment of principal or interest due on such note, and to start the running of a new period of time, but no such payment of itself shall revive a cause of action once barred.
- statuteCal. Civ. Proc. Code § 339enactment date not established
The words that state the rule
Within two years: 1. An action upon a contract, obligation or liability not founded upon an instrument of writing, except as provided in Section 2725 of the Commercial Code or subdivision 2 of Section 337 of this code; or an action founded upon a contract, obligation or liability, evidenced by a certificate, or abstract or guaranty of title of real property, or by a policy of title insurance; provided, that the cause of action upon a contract, obligation or liability evidenced by a certificate, or abstract or guaranty of title of real property or policy of title insurance shall not be deemed to have accrued until the discovery of the loss or damage suffered by the aggrieved party thereunder.
- statuteCal. Com. Code § 2725enactment date not established
The words that state the rule
(1) An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued. By the original agreement the parties may reduce the period of limitation to not less than one year but may not extend it. (2) A cause of action accrues when the breach occurs, regardless of the aggrieved party’s lack of knowledge of the breach. A breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered. (3) Where an action commenced within the time limited by subdivision (1) is so terminated as to leave available a remedy by another action for the same breach such other action may be commenced after the expiration of the time limited and within six months after the termination of the first action unless the termination resulted from voluntary discontinuance or from dismissal for failure or neglect to prosecute. (4) This section does not alter the law on tolling of the statute of limitations nor does it apply to causes of action which have accrued before this code becomes effective.
- statuteCal. Civ. Proc. Code § 337enactment date not established
The words that state the rule
(b) An action to recover (1) upon a book account whether consisting of one or more entries; (2) upon an account stated based upon an account in writing, but the acknowledgment of the account stated need not be in writing; (3) a balance due upon a mutual, open and current account, the items of which are in writing; provided, however, that if an account stated is based upon an account of one item, the time shall begin to run from the date of the item, and if an account stated is based upon an account of more than one item, the time shall begin to run from the date of the last item.
- caseNo. B333759 (Cal. Ct. App. Dec. 19, 2024)Jenkins v. Dermatology Management, LLCCal. Ct. App.decided 2024
The words that state the rule
It is settled that parties may agree, in an arbitration agreement or otherwise, to shorten the limitations period applicable to a claim. [Citations.] However, the shortened limitations period must be reasonable.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.