Engstrom

Wendy B. Engstrom filed the underlying lawsuit following institution of foreclosure proceedings against her real property by a lender acting to enforce its security interest in the property. The trial court sustained without leave to amend the lender’s demurrer to Engstrom’s first amended complaint. We reverse. We hold that (1) Engstrom sufficiently pled her entitlement to statutory notice from the lender as a cosigner on a consumer credit contract to withstand the lender’s demurrer, and (2) because Engstrom did not receive the cosigner notice, her action based on that failure to give notice did not accrue, and the statute of limitations did not begin to run, until the lender initiated foreclosure proceedings.

Background

According to the first amended complaint, Engstrom was the owner of certain multifamily residential real property located in Santa Monica. At her former husband’s request, Engstrom signed a trust deed and note encumbering the property in favor of respondent James G. Kallins, M.D., Inc., Profit Sharing Retirement Trust. Engstrom alleged that James and Virginia Kallins were trustees of the Trust. For brevity’s sake we refer to the Kallinses and the trust…