Barer v. Goldberg

• Decision Date: 19 June 1978
• Docket Number: No. 2589-II,2589-II
• Citation: 582 P.2d 868,20 Wn.App. 472
• Parties: David BARER and Dorothy Barer, husband and wife, Respondents and Cross-Appellants, v. Alan GOLDBERG, Appellant, v. Janice GOLDBERG, Respondent and Cross-Appellant.
• Court: Washington Court of Appeals

Page 472

20 Wn.App. 472

582 P.2d 868

David BARER and Dorothy Barer, husband and wife, Respondents and Cross-Appellants, v. Alan GOLDBERG, Appellant, v. Janice GOLDBERG, Respondent and Cross-Appellant.

No. 2589-II.

Court of Appeals of Washington, Division 2.

June 19, 1978.

Odine H. Husemoen, Walstead, Mertsching, Husemoen, Donaldson & Barlow, Longview, for appellant.

William L. Dowell, Walker & Dowell, Longview, for Janice Goldberg.

R. Graham Cross, Longview, for Barers.

SOULE, Judge.

This is an action to secure repayment of a loan. The two principal issues presented pertain to the statute of limitations and the applicability of the long-arm statute to the third-party defendant, Janice Goldberg. We affirm the action of the trial court in granting judgment to the plaintiffs against Alan Goldberg, and also the granting of a judgment for contribution in favor of Alan Goldberg against Janice Goldberg.

Prior to May 5, 1969 defendant Alan Goldberg had married Janice Goldberg, the daughter of David and Dorothy Barer. The Goldbergs lived in California. The Barers lived in Washington. On May 5, 1969 Alan Goldberg telephoned David Barer and asked for $15,000 to invest in a business enterprise. Mrs. Barer immediately wrote a check on the Barers' joint bank account and sent it to Alan Goldberg. Janice Goldberg was then with her husband in California and was aware of the conversation between her husband and her father.

The trial court found that the advance was intended as a loan, not a gift; that Janice and Alan intended to repay the loan when it was granted and retained that intent at least until January of 1975 when they were divorced. For the purposes of the divorce, however, the Goldbergs apparently treated the debt as barred by the California statute of limitations of three years. In any event, the obligation was not mentioned in the California decree which disposed of their substantial assets and debts. The Washington trial court specifically entered finding No. 2.13, which reads:

Intent, re: Repayment. It was the intent of both parties that a speedy and rapid demand for repayment would not be made, because it was contemplated by the parties that it would take considerable time for the proposed business, ventures, which consisted of the filming of pilot series, to get off the ground and become financially successful, and it was the intent of the parties that the defendant, Alan Goldberg, should be given a sufficient and indefinite time to develop these businesses before any demand for repayment would be made.

No demand was made while the parties lived in California. After the divorce was final, Alan Goldberg moved to Cowlitz County, arriving in the month of March, 1975. Sometime in the month of April, 1975, a formal demand for payment was made. This action was commenced by the Barers on April 30, 1975.

Alan Goldberg then brought a third-party action against Janice Goldberg seeking contribution. She was still in California. Service was obtained by the long-arm statute.

Apart from finding No. 2.13 relating to the purpose of the loan and finding No. 2.4 concerning the details of the telephone call and the sending of the check, finding No. 2.11 is the only other finding of fact bearing on the contact of the Goldbergs with the State of Washington:

Residence. The defendant, Alan Goldberg, was a resident of the State of California prior to May 5, 1969, and continuing until March, 1975 when he moved to the State of Washington. Janice Goldberg on and prior to May 5, 1969, and continuing through the present, was a resident of the State of California. David Barer and Dorothy Barer at all times material hereto have been residents of the State of Washington. Alan Goldberg and Janice Goldberg were married in the State of Washington, lived in the State of Washington prior to moving to California, visited David Barer and Dorothy Barer in the State of Washington at least annually and returned to the State of Washington for visits on a number of occasions since May 5, 1969.

No challenge is directed to any findings of fact. Alan Goldberg assigns error to conclusions of law numbers 3.3 and 3.4 which read:

3.3 Statute of Limitations. The three-year statute of limitations is applicable to this action as this is not a written promise to repay money. The statute of limitations did not begin to run on May 5, 1969, when the money was advanced. In the absence of a formal demand for payment, the statute of limitations did not commence to run until a reasonable period of time had passed and said time is deemed to be three years. Accordingly, the statute of limitations did not commence to run until May 5, 1972. Hence, the action was timely filed and is not barred by the statute of limitations.

3.4 Judgment. Plaintiffs, David Barer and Dorothy Barer, are entitled to a judgment against Alan Goldberg for the sum of $15,000 plus their costs and statutory attorney's fees.

The sole question on the primary case is when the statute of limitations begins to run.

In the third-party action, cross-appellant, Janice Goldberg, assigns error only to conclusion of law No. 3.1 which reads:

Jurisdiction. The Court has jurisdiction over both the defendant and third party defendant by virtue of the fact that said parties were visiting and doing business in the State of Washington prior to and subsequent to the time they borrowed the money on May 5, 1969.

The issues to be resolved by her appeal are first, what contacts are sufficient to justify the employment of the long-arm statute against Janice Goldberg and, second, whether the affidavit of service was filed in time to give the court jurisdiction.

STATUTE OF LIMITATIONS

Absent other facts, a loan evidenced merely by a check with the notation, "loan" upon it, is governed by the three-year statute of limitations. National Bank of Commerce v. Preston, 16 Wash.App. 678, 558 P.2d 1372 (1977). Such a transaction normally is characterized as a demand loan and the statute begins to run when the loan is made. Hopper v. Hemphill,19 Wash.App. 334, 575 P.2d 746 (1978).

However, an exception to the rule exists when delay in making the demand is contemplated by the parties at the time the contract is made and where speedy demand would violate the spirit of the contract. Cochran v. Cochran, 133 Wash. 415, 233 P. 918 (1925). Annot. 159 A.L.R. 1033, 1040, 1044, 1052-53 (1945).

Alan Goldberg argues that Cochran should be limited to its unique facts as an isolated case in the state of Washington, but we see no reason to do so. The principle upon which it was decided is generally recognized and in Hopper v. Hemphill, supra, our court has recently had occasion to observe, 19 Wash.App. at page 335, 575 P.2d at page 747:

If an actual notice or demand is required for a cause of action to accrue on a demand loan obligation, then the statute of limitations does not commence running until notice is given or demand is made, or until a reasonable time has elapsed.

The court further stated, at page 338, 575 P.2d at page 748:

Unquestionably, parties to an agreement may so frame it as to make a preliminary demand prerequisite to a right of action . . .

In Hopper, the court was commenting upon an oral agreement. There is no requirement under our law that the agreement be in writing.

The intent of the parties appears in the record in the unchallenged finding No. 2.13. We recognize that where it is the intent of the parties that an actual demand be made before the statute starts to run, one cannot indefinitely delay the accrual of the cause of action by deferring that demand. See Edison Oyster Co. v. Pioneer Oyster Co. 22 Wash.2d 616, 157 P.2d 302 (1945); Washington Security Co. v. State, 9 Wash.2d 197, 213, 114 P.2d 965, 135 A.L.R. 1330 (1941). The maximum reasonable time for making the demand, which is a condition precedent to the cause of action, is generally held to be the number of years specified by the statute for bringing suit, and if no actual demand is made within the period of the statute of limitations, it will be presumed to have been made at the expiration of the statutory period, thus starting the running of the statutory time. Authorities recognizing this principle are Gossard v. Gossard, 149 F.2d 111 (10th Cir. 1945); Woolsey v. Trimble, 18 F.2d 908 (6th Cir. 1927); Massie v. Byrd,87 Ala. 672, 6 So. 145 (1889); Johnston v. Keefer, 48 Idaho 42, 280 P. 324 (1929); Daugherty v. Wheeler, 125 Ind. 421, 25 N.E. 542 (1890); Smith v. Smith, 91 Mich. 7, 51 N.W. 694 (1892). See also 51 Am.Jur.2d, Limitation of Actions, § 128, pp. 697-98 (1970), and 159 A.L.R. 1021 (1945).

We adopt the principle that the demand must be made within a reasonable time and that in the absence of an actual demand, demand will be presumed to have been made at the expiration of the statutory period, which in this case was May 5, 1972. We hold that an action commenced on April 30, 1975 is within the statute of limitations and the action is not barred. The trial court's conclusions were therefore correct.

LONG-ARM STATUTE

Janice Goldberg appeals from the judgment requiring contribution. Jurisdiction was obtained by out-of-state service under the long-arm statute. RCW 4.28.185 ¹ That statute is available to a third-party plaintiff who seeks contribution in connection with the defense of a primary action and the right of the third-party plaintiff for contribution against the third-party defendant is dependent upon the potential Primary liability of the third-party defendant to the primary plaintiff. Deutsch v. West Coast Machinery Co., 80 Wash.2d 707, 497 P.2d 1311 (1972). Cert. denied 409 U.S. 1009, 93 S.Ct. 443, 34 L.Ed.2d 302 (1973).

The debt was presumptively a community debt, National Bank of Commerce v. Green, 1 Wash.App. 713, 463 P.2d 187 (1969), and the presumption is not challenged.

As we see it, the critical question to be answered is whether the Community had sufficient contact with the State of Washington in connection...