Westfour Corp. v. California First Bank

Westfour Corporation (Westfour) appeals from the trial court’s judgment in favor of California First Bank (California First). West-four contends the trial court erred in finding Westfour’s mechanic’s lien claims against California First barred by the statute of limitations. We agree and reverse.

I. Factual and Procedural Background

On March 21, 1984, Bernard B. Blatte (Blatte), the owner of a parcel of improved real property (the Property) in San Francisco, entered into a construction loan agreement with California First whereby the bank agreed to loan Blatte $3,250,000 to finance renovations and additions to the Property. On this same date, Blatte executed a deed of trust in favor of California First securing his performance under the construction loan agreement and the related promissory note. California First did not record this deed of trust until July 17, 1984. In the interim, Blatte hired Joseph L. Barnes Construction Co., Inc. (Barnes) as contractor for the project, and excavation work on the Property began. Blatte’s contract with Barnes did not include tenant improvements, although tenant improvements were included in the disbursement schedule to the…