Varr
Varr v. Olimpia
Opinion
Opinion
Cottle, J.
In this appeal, we are asked to determine whether Civil Code section 1917.220 is preempted by the Employee Retirement Income Security Act of 1974 (ERISA). ( 29 U.S.C. § 1001 et seq.) We hold that it is. We also hold that ERISA does not preempt California’s general usury laws.
Facts
In February 1988, plaintiff J. Anthony Varr retained the law firm of Olimpia, Whelan & Lively (the law firm) to represent him in a marital dissolution action. The law firm in turn retained McCahan, Helfrick, Thiercof & Butera Accountancy Corporation (the accounting firm) to provide accounting services and evaluate “the going business value of J. Anthony Varr Corporation . . . .”
The law firm has a profit sharing plan (the Plan), which is a qualified employee pension plan within the meaning of ERISA and the Internal Revenue Code. In February 1990, the Plan lent Varr $110,000 to pay for legal services rendered. In connection with the loan, Varr executed a promissory note secured by a deed of trust on real property in Scotts Valley. In October 1990, the accounting firm lent Varr $50,000 to pay for accounting services rendered. In connection with this loan, Varr executed a second promissory…