FIRST TENNESSEE BANK NATIONAL ASSOCIATION, SUCCESSOR BY MERGER TO FIRST HORIZON HOME LOAN CORPORATION, APPELLANT,
JASON NEWHAM, APPELLEE
Appeal from the District Court for Cass County: JEFFREY J. FUNKE, Judge.
Brian J. Muench for appellant.
Edward F. Noethe and Michael G. Monday, of McGinn, McGinn, Springer & Noethe, for appellee.
HEAVICAN, C.J., WRIGHT, CONNNNOLLY, STEPHAN, MCCORMACK, MILLER-LERMAN, and CASSEL, JJ.
[290 Neb. 274] Cassel, J.
A lender sued upon a promissory note. The district court determined that the action was barred by a California statute of limitations and entered summary judgment in the borrower's favor. On appeal, the lender contends that the limitations period was tolled by either a California statute or a provision of the Servicemembers Civil Relief Act (SCRA). We affirm.
The California tolling statute could not be applied against the borrower, a nonresident of California, without violating the Commerce Clause. And the borrower's membership in the National Guard provided no basis to toll the limitations period.
Jason Newham executed a promissory note dated September 8, 2005, in favor of First Horizon Home Loan Corporation in the amount of $182,000. Newham used the funds to refinance a prior mortgage on real property located in Dixon, California. At that time, Newham was a resident of California and " in active duty, Air Force," stationed at Travis Air Force Base. Payments on the note were due on the first of every month, and the note was secured by a deed of trust for the property.
Sometime after execution of the note, First Horizon Home Loan Corporation merged with First Tennessee Bank National [290 Neb. 275] Association (First Tennessee). As a result, First Tennessee became the holder of the note.
Newham left California and vacated the property in May 2007. He made his last payment on the note on August 6. He resided in Papillion, Nebraska, until September, when he moved to Kansas to work for an aircraft company as a demonstration pilot. Although Newham had joined the North Dakota National Guard in July 2007, he did not move to North Dakota until June 2009. With the North Dakota National Guard, he was " part-time for the first  years, and then . . . full-time, at the state level, for the last . . . almost  years." Newham later moved to Minnesota, but he returned to Nebraska in June 2013.
On August 5, 2013, First Tennessee filed a complaint against Newham, alleging that he was in default on the note and seeking damages in the amount of $274,467.13, plus interest. In response, Newham moved for summary judgment and alleged that First Tennessee's suit was barred by the statute of limitations. First Tennessee filed an amended complaint and alleged that Newham was an " absconding debtor."
At the summary judgment hearing, Newham's counsel argued that First Tennessee's action was governed by California law and that First Tennessee had failed to bring the action within 4 years as required by Cal. Civ. Proc. Code § 337 (West 2006). First Tennessee, however, asserted that the statute of limitations had been tolled by either Cal. Civ. Proc. Code § 351 (West 2006) or 50 U.S.C. app. § 526(a). As discussed in greater detail below, § 351 tolls the statute of limitations during the period of time that a defendant is outside of California and § 526(a) tolls the statute of limitations during the " period of a servicemember's military service," as defined by relevant federal law.
The district court also received various discovery into evidence, including Newham's answers to interrogatories and his deposition testimony. As to his current employment status, Newham stated that he is a " part-time member" of the Nebraska Air National Guard. His position does not entail active duty status. When asked to provide the dates and duty stations of his periods of active duty, Newham indicated that [290 Neb. 276] his most recent period of active duty was from March 2005 to July 2007 at Travis Air Force Base.
As to his repayment of the note, Newham confirmed that he made his last payment on August 6, 2007, and that he " was in breach of the contract" as of September 2. Additionally, he testified that he never
returned to California after he vacated the property.
On February 3, 2014, the district court entered summary judgment in Newham's favor. In its order, the court determined that First Tennessee's claim was governed by the California statute of limitations and that First Tennessee had failed to file suit within the 4-year limitations period. As to the tolling provision of Cal. Civ. Proc. Code § 351, the court concluded that, if applied against Newham, § 351 would violate the Commerce Clause of the U.S. Constitution. However, the court did not address the tolling provision of 50 U.S.C. app. § 526(a).
First Tennessee moved for new trial and alleged that the district court erred in failing to apply § 526(a). Additionally, First Tennessee asserted that Newham had the burden to show that the application of § 351 would violate the Commerce Clause. And it alleged ...