Castaldi

On this appeal we are asked to determine the statute of limitations for an action by a bank against a former customer for repayment where the bank honored a check drawn by the customer but neglected to debit the customer’s account. We conclude the applicable limitations period for such an action is three years from the time the bank discovers its mistake, pursuant to Code of Civil Procedure section 338, subdivision (d).

Additionally, we reject defendants’ contention that there was a material variance between pleading and proof in this action.

Factual and Procedural Background

In November of 1988, defendant and appellant Karen A. Castaldi wrote a check in the amount of $11,856 on an account with Mitsubishi Bank (which had recently merged with the Bank of California) in the name of defendant and appellant David A. Castaldi, doing business as Terra Trailers and Truck Sales. The check was cashed by the payee and paid by the bank, but the bank for some reason never debited the payment from Castaldi’s account. Castaldi closed the account in June 1989. In August 1989 the bank realized its mistake and requested Castaldi repay the money paid on the check. The bank eventually…