## Facts

- A November 7, 1985 automobile collision occurred between Erik Nelson Sidney and Pauline H. Kinoshita.
- On February 24, 1986, Kinoshita sued Sidney for personal injury and property damage.
- On April 17, 1986, Sidney filed a cross-complaint against Kinoshita (and an alleged vehicle owner/employer) seeking only property damages arising from the same accident.
- On April 27, 1987, Sidney moved for leave to amend the cross-complaint to add a personal injury cause of action based on the same accident.
- Sidney attributed the earlier omission of his personal injury claim to mistake/neglect by prior counsel.
- The trial court denied leave to amend on the ground that the personal injury limitations period had expired and that relation back did not apply where the original cross-complaint sought only property damage.
- Sidney sought writ relief to compel the trial court to permit the amendment.

## Issues

1. Whether the statute of limitations bars a defendant from amending a compulsory cross-complaint to add a personal injury claim arising from the same accident when the claim was not time-barred when the plaintiff filed the original complaint.
2. Whether the trial court erred by denying leave to amend solely on limitations and a categorical rejection of relation back for a property-damages-only pleading.

## Decision

- The Court of Appeal granted writ relief and directed the trial court to allow the amended cross-complaint.
- The court held the statute of limitations did not bar the amendment because the filing of the plaintiff’s complaint tolled limitations for the defendant’s claims arising out of the same transaction or occurrence, so long as those claims were timely when the complaint was filed.
- The court rejected the trial court’s reliance on authority addressing amendments to a plaintiff’s complaint as a basis to deny a defendant’s amendment to a compulsory cross-complaint under these circumstances.
- The court emphasized California’s policy favoring resolution on the merits and liberal amendment of pleadings, including amendments to compulsory cross-complaints when omission resulted from mistake or neglect and no bad faith finding was made.

## Legal Principles

- When a plaintiff files an action, the filing tolls the statute of limitations for the defendant’s causes of action arising out of the same transaction or occurrence, provided those causes of action were not time-barred when the plaintiff’s complaint was filed.
- A defendant may assert such claims by compulsory cross-complaint during the pendency of the plaintiff’s action, even if the limitations period would have expired after the action commenced.
- Claims arising from the same accident are treated as compulsory cross-claims for purposes of California’s cross-complaint scheme, which seeks to avoid forfeiture and to consolidate related disputes in one action.
- Trial courts should apply a liberal standard in permitting amendments to cross-complaints where omission resulted from mistake, inadvertence, or excusable neglect, absent a supported finding of bad faith or substantial prejudice.

## Conclusion

The court held that a plaintiff’s timely filing tolls limitations for the defendant’s compulsory cross-claims arising from the same accident, so a defendant may amend a cross-complaint to add a personal injury claim during the action if it was timely when the plaintiff sued, and the trial court must permit the amendment absent a valid nonlimitations basis to deny leave.


Sidney v. Superior Court, 198 Cal. App. 3d 710, 244 Cal. Rptr. 31 (Ct. App. 1988)