You must file suit within two years from the date of the breach.
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I agree with Mr. Boss that the statute of limitations on an oral contract are two years from the date of breach.
The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.
Mr. Boss is correct, the statute of limitations for breach of a verbal contract is 2 years from the date of breach (CCP section 339).
The information presented here is general in nature and is not intended, and should not be construed, as legal advice for a particular case. This posting does not create any attorney-client relationship with the author, and Pham Law Group does not represent you as your attorneys until retained by a written retainer agreement signed by both parties.
California Code of Civil Procedure Section 339 states:
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.
2. An action against a sheriff or coroner upon a liability
incurred by the doing of an act in an official capacity and in virtue
of office, or by the omission of an official duty including the
nonpayment of money collected in the enforcement of a judgment.
3. An action based upon the rescission of a contract not 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 does not begin to
run until the discovery by the aggrieved party of the facts
constituting the fraud or mistake.
Depending on the exact date of February 2011 the breach occurred the statute of limitations may have already run. I suggest you contact a local business attorney as soon as possible to see if you 1) have a case and 2) still have time to file a lawsuit.
I hope this helps!
You may have other causes of action, such as fraud, which have a longer statute of limitations. This is not a lawsuit you can successfully prosecute on your own. If you do not have counsel, you need to retain one. If you cannot afford one, you're probably out of luck.
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You must file suit within two years from the date of breach of an oral contract. Due to the complexity of issues in your case, you need to consult an attorney immediately. The defendant may try to knock out your lawsuit based on the alleged running of the statute of limitations. Good luck.
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I agree on the 2 years for oral contract statute, and there appears to be a matter of dispute on the date of breach. That will likely be a triable issue to determine, but it is interesting the other party is saying they breached your agreement in 2010. You may want to get them to confirm that later. Now, what is concerning that you intended to be a co-owner without an agreement and you were on the payroll. You may want to look further into employment issues as you may have a wrongful termination action and breach of good faith & fair dealing on not to terminate without good cause. There may be something more than an At-Will employment agreement present if you were a Co-owner. These are only matters to think about and certainly odds are against you as an owner without anything in writing. Paper evidence of your financial support or otherwise in exchange in forming the business might be important.
Tim Broussard, Esq
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