Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_19-cv-05500/USCOURTS-cand-3_19-cv-05500-0/pdf.json

Nature of Suit Code: 550
Nature of Suit: Prisoner - Civil Rights (U.S. defendant)
Cause of Action: 42:1983 Prisoner Civil Rights

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

MARK HOTTON,

Plaintiff,

v.

L & S LAND CO., et al.,

Defendants.

Case No. 19-cv-05500-SI 

ORDER TO SHOW CAUSE RE. 

CONTEMPLATED DISMISSAL

Re: Dkt. No. 1

Mark Hotton, an inmate currently incarcerated at the Federal Correctional Institution – Fort 

Dix in New Jersey, filed this pro se civil action and applied to proceed in forma pauperis. The 

complaint is now before the court for review pursuant to 28 U.S.C. § 1915.

BACKGROUND

The complaint is dated October 9, 2018, and was sent to the court in an envelope in which 

there also was a certificate of service and enclosure letter dated August 12, 2019. The complaint 

was stamped filed on August 30, 2019. Under the prisoner mailbox rule, the complaint is deemed 

filed as of the date a pro se prisoner gives a document to prison officials to mail to the court. Douglas 

v. Noelle, 567 F.3d 1103, 1108-09 (9th Cir. 2009). The court assumes for present purposes that 

Hotton gave the envelope to prison officials to mail to the court on the day he signed the certificate 

of service and enclosure letter, and deems the complaint to have been filed on August 12, 2019.

The complaint alleges a breach of contract. Hotton allegedly loaned to defendants $100,000 

at 10% interest on May 5, 2005, with the loan being due and payable at the expiration of a 12-month 

period. Docket No. 1 at 2. (A promissory note dated May 5, 2005, apparently bearing the signature 

of Defendant Scardigli on behalf of L & S Land Co., a California Partnership, and with a blank 

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United States District Court

Northern District of California

signature line for Defendant Albert Laudel is attached to the complaint. Docket No. 1 at 4.) 

Defendants allegedly “continuously promised to satisfy the promissory note, misleading Plaintiff 

that note would be satisfied up & through October 12, 2012 and again in 2013.” Id. at 2-3. 

Defendants allegedly have made no payments of principal or interest on the note and therefore are 

in default. Id. at 3.

Hotton invokes the court’s diversity jurisdiction because he is a resident of New York and 

the other defendants reside in California. See 28 U.S.C. § 1332(a) (court has jurisdiction over a civil 

action where the matter in controversy exceeds $75,000 and the action is between citizens of 

different States). 

DISCUSSION

In an action in which a plaintiff seeks to proceed in forma pauperis, a district court may 

screen the complaint to fulfill its duty under 28 U.S.C. § 1915(e)(2)(B), which requires the court to 

dismiss a case if the court determines that the action is frivolous or malicious, fails to state a claim, 

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).

To state a breach of contract cause of action in California, a plaintiff must allege “(1) the 

existence of the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's 

breach, and (4) the resulting damages to the plaintiff.” Oasis West Realty, LLC v. Goldman, 51 

Cal.4th 811, 821 (Cal. 2011).

Plaintiffs are required to file their claims within certain time limits, or forever lose the right 

to enforce the right to assert the claims. Those time limits are set out in statutes of limitations, such 

as California’s four-year statute of limitations for actions for breach of contract. There appears to 

be a statute of limitations problem for Hotton.

Under California law, an action upon a “contract, obligation or liability founded upon an 

instrument in writing” must be brought within four years. Cal. Code Civ. Proc. § 337(a). Generally, 

the limitations period “runs from the moment a claim accrues.” Aryeh v. Canon Business Solutions, 

Inc., 55 Cal. 4th 1185, 1191 (Cal. 2013). California follows the “‘last element’” accrual rule, which 

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United States District Court

Northern District of California

provides that the statute of limitations period starts upon the occurrence of the last element essential 

to the cause of action. See id. at 1191. The essential elements for purposes of determining the 

accrual date are “‘wrongdoing, harm, and causation.’” See id.

Some events can cause a delay in the start of the limitations period or in the deadline to get 

to court. Incarceration of the plaintiff is a disability that may toll the statute for a maximum of two 

years, but only for a plaintiff who is in prison “for a term less than for life” and is under the disability 

at the time the cause of action accrues. See Cal. Civ. Proc. Code § 352.1. 

The commencement of the limitation period also may be delayed under the discovery rule 

which, when applicable, “‘postpones accrual of a cause of action until the plaintiff discovers, or has 

reason to discover, the cause of action.’” Aryeh, 55 Cal. 4th at 1192. 

The limitations period also is subject to equitable tolling, which “‘reliev[es] plaintiff from 

the bar of a limitations statute when, possessing several legal remedies he, reasonably and in good 

faith, pursues one designed to lessen the extent of his injuries or damage.’” Cervantes v. City of San 

Diego, 5 F.3d 1273, 1275 (9th Cir. 1993) (quoting Addison v. California, 21 Cal. 3d 313, 317 

(1978)). Thus, in an appropriate case, the statute of limitations might be tolled for time spent 

pursuing a remedy in another forum before filing the claim in federal court. 

Although the statute of limitations is an affirmative defense that normally may not be raised 

by the court sua sponte, it may be grounds for sua sponte dismissal of an in forma pauperis complaint 

where the defense is complete and obvious from the face of the pleadings or the court's own records. 

See Franklin v. Murphy, 745 F.2d 1221, 1228-30 (9th Cir. 1984). That is the situation here: the 

defense appears complete and obvious from the face of the complaint because this action was filed 

more than thirteen years after the purported breach of contract occurred. The promissory note was 

dated May 5, 2005, and called for repayment within a year, or by May 5, 2006. Under the normal 

four-year limitations period, the deadline to file the action for breach of contract would have been 

in May 2010, yet Hotton did not file his federal action until more than nine years later, in August 

2019. That is far beyond the four-year limitation period for bringing a breach of contract action. 

And, although Hotton is now incarcerated, he may not have been incarcerated at the time the cause 

of action accrued, and therefore would not receive the benefit of the tolling provision of California 

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Code of Civil Procedure § 352.1. Even if he was incarcerated at the time the cause of action accrued, 

the two years of tolling under § 352.1 would not extend his deadline by enough time to make the 

complaint timely. Hotton must explain why his complaint should not be dismissed as time-barred. 

CONCLUSION

Because the statute of limitations problem appears complete and obvious from the face of 

the complaint, Hotton is now ORDERED TO SHOW CAUSE why his complaint is not barred by 

the statute of limitations. He must submit any argument he has to show that the statute of limitations 

does not bar his claim that defendants breached the May 5, 2005, promissory note. Plaintiff must 

file his written response no later than January 10, 2020. Failure to file the written response to the 

order to show cause will result in the dismissal of this action.

IT IS SO ORDERED.

Dated: December 9, 2019

______________________________________

SUSAN ILLSTON

United States District Judge

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