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Union Oil Co. of Cal. v. Terrible Herbst, Inc.

ELR Citation: 33 ELR 20219
Nos. Nos. 01-16683, -17276, (9th Cir., 06/09/2003)

The court holds that in a contract dispute over the responsibility for pollution cleanup beneath a gas station, withholding assertion of a nonfrivolous claim in reliance on an agreement waiving a statute-of-limitations defense constitutes sufficient consideration under Nevada law. The current owner of the gas station filed suit against the prior owner for breach of contract, and a jury awarded the current owner $1,086 million for past and future costs. The district court, however, vacated the verdict, holding that the agreement did not toll or waive the statute of limitations. Nevada law, however, allows the forbearing to bring a stale claim to serve as consideration for an agreement waiving a statute-of-limitations defense. The district court also erred in holding that the prior owner waived its statute-of-limitations defense only as to claims that legitimately could have been asserted against it at the time. The court, therefore, remands the case with instruction to reinstate the jury verdict.

Counsel for Plaintiff
Alice A. Seebach
Seebach & Seebach
800 Wilshire Blvd., Los Angeles CA 90017
(213) 553-7900

Counsel for Defendant
J. Terry Schwartz
Price, Postel & Parma
200 E. Carrillo St., Santa Barbara CA 93102
(805) 962-0011