La Sala v. American Sav. & Loan Assn

In La Sala v. American Sav. & Loan Assn. (1971) 5 Cal.3d 864, plaintiffs brought a class action lawsuit against American Savings & Loan Association alleging a provision in its form trust deed constituted an invalid restraint upon alienation. The lender offered to waive enforcement of that provision for the named plaintiffs. The trial court ruled the "named plaintiffs no longer represented the class" as a result of this waiver and "dismissed the action." (Id. at p. 868.) The Supreme Court reversed, holding where a court "concludes that the named plaintiffs can no longer suitably represent the class, it should at least afford plaintiffs the opportunity to amend their complaint, to redefine the class, or to add new individual plaintiffs, or both, in order to establish a suitable representative." (Id. at p. 872.)