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California Court Tackles Question Of When An Amendment Is A New Agreement

The parties to an agreement agree upon a change to the terms.  Should the change be labeled an "amendment" or a "new agreement".  Often this will simply be a question of nomenclature.  Sometimes, however, more the difference between an amendment and a new agreement can have substantive consequences.  Such was the case in Citizens for Amending Proposition L v. City of Pomona, Cal. Ct. Appeal Case No. B283740 (Nov. 7, 2018).  

The case involved a challenge to a billboard.  After the billboard and the City of Pomona entered into an agreement providing for the erection of billboards in the City, the voters passed a proposition banning new billboards within the city.  A month after the original agreement expired, the City passed an ordinance purporting to "amend" the agreement to extend its term.  The anti-billboard group contended that a new agreement would violate the proposition.  The City did not contest that point but disagreed with the trial court's conclusion that the post-termination extension constituted a new agreement.  The Court of Appeal was not swayed by the City's argument and affirmed.

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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm

Keith Paul Bishop is a partner in Allen Matkins' Corporate and Securities practice group, and works out of the Orange County office. He represents clients in a wide range of corporate transactions, including public and private securities offerings of debt and equity, mergers and acquisitions, proxy contests and tender offers, corporate governance matters and federal and state securities laws (including the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Act), investment adviser, financial services regulation, and California administrative law. He regularly advises clients...