Laws, Regulations and Annotations
Search
Business Taxes Law Guide—Revision 2024
Sales And Use Tax Court Decisions
A B C D E F G H I J K L M N O P R S T U V W Y
C
Carleton; State Board of Equalization v. … (1990)
Guaranty for Past-Due Taxes Enforced Despite Changes
A surety guaranteed the tax liability of taxpayer. During an audit, taxpayer signed a waiver extending the time in which the Board might issue a delinquency determination. The surety argued that the waiver exonerated him from liability under Civil Code Section 2819, which provides that a surety is exonerated if the terms of the principal's obligation to the creditor are altered in any material way without the surety's consent.
The court of appeal allowed the Board to recover on the guaranty. The court agreed that the waiver was a material change in taxpayer's obligation, but held that the surety had consented to the change by accepting the following language in the Board's standard guarantee form: "the surety's liability shall be coextensive with that of the taxpayer and no change in the law or extensions, waivers or modifications in the liability between the taxpayer and the State Board of Equalization shall relieve the surety of his obligation herein." State Board of Equalization v. Carleton (1990) 223 Cal.App.3d 1607.