AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

The case arose from a debt collection dispute. A bank extended loans to a corporation, which were guaranteed personally by one of the defendants. The loans were consolidated and renewed multiple times, but the corporation defaulted. The bank demanded payment from the guarantor, who argued that the statute of limitations barred the claim.

Procedural History

• District Court of Bernalillo County: Judgment was awarded in favor of the bank, including the debt amount, daily accrual, costs, and attorney's fees. The defendant appealed.

Parties' Submissions

• Appellant (Defendant-Guarantor): Argued that the statute of limitations under NMSA 1978, Section 37-1-3(A), barred the bank's claim. Contended that the limitation period began when the guaranty was signed, as it was payable "on demand".
• Appellee (Bank): Asserted that the statute of limitations began to run only when demand for payment was made, as demand was a condition precedent to the guarantor's obligation to pay.

Legal Issues

• Does the statute of limitations for a demand guaranty begin to run upon the signing of the guaranty or upon the demand for payment?

Disposition

• The Supreme Court of New Mexico affirmed the judgment of the trial court in favor of the bank.

Reasons

Per Franchini J. (Ransom and Baca JJ. concurring):

The Court held that the statute of limitations for a demand guaranty begins to run only when demand is made upon the guarantor. It reasoned that a demand for performance is an express condition precedent to the guarantor's obligation to pay. The Court distinguished between demand notes, where the statute begins to run upon execution, and demand guaranties, where the obligation arises only after demand is made. The Court relied on precedent and legal principles from other jurisdictions to support its conclusion.