MARTIN I LEVY V MARK L MARTIN
Annotate this Case
Download PDF
Michigan Supreme Court
Lansing, Michigan 48909
____________________________________________________________________________________________
Chief Justice
Justices
Elizabeth A. Weaver
Micha el F. Cavana gh
Marilyn Kelly
Cliffor d W. Taylor
Maura D. Corrigan
Robert P. Young, Jr.
Stephen J. Markman
Opinion
____________________________________________________________________________________________________________________________
FILED JANUARY 3, 2001
MARTIN I. LEVY and
MARTIN I. LEVY, D.D.S., P.C.,
Plaintiffs-Appellants,
v
No. 115603
MARK L. MARTIN, GERALD HOSKOW,
and HOSKOW & MARTIN, P.C.,
Defendants-Appellees.
________________________________
PER CURIAM
The
plaintiffs
filed
a
malpractice
action
that
the
circuit court dismissed on the ground that the limitation
period had expired.
The Court of Appeals affirmed.
Because
we agree with the plaintiffs that their suit was timely, we
reverse in part the judgments of the circuit court and the
Court of Appeals.
I
From 1974 until 1996, accountants Mark L. Martin and
Gerald Hoskow1 prepared the annual tax returns of Martin I.
1
Messrs. Martin and Hoskow were principals in an
accounting firm that bore their names. In this opinion, when
we refer to them, we also mean their firm.
Levy, D.D.S.2
As the result of an audit by the Internal
Revenue Service, Dr. Levy was required to pay additional taxes
for 1991 and 1992, as well as penalties and interest.3
also
incurred
legal
expenses
and
additional
1997,
Dr.
filed
He
accounting
expenses.4
In
August
Levy
in
circuit
court
a
complaint in which he alleged that losses exceeding ninety
thousand dollars had been caused by the malpractice of Messrs.
Martin and Hoskow.5
The
1991
and
1992
tax
returns
of
which
Dr.
Levy
complained were prepared and submitted in 1992 and 1993,
respectively.
Observing that the limitation period for a
malpractice action is two years,6 Messrs. Martin and Hoskow
filed a motion to dismiss in lieu of an answer.7
The circuit
2
Taxes were also prepared for Dr. Levy’s professional
corporation. References to Dr. Levy include the corporation.
3
In his application to this Court, Dr. Levy says he
received a “notice of deficiency” form in December 1995 and
that he settled with the IRS in March 1997, when stipulated
orders were entered in two cases in the United States Tax
Court.
4
This case was dismissed by the circuit court before a
trial or discovery. For present purposes, we thus accept as
true the plaintiffs’ allegations.
5
That allegation was contained in count I of the
complaint, which was titled “Negligence & Professional
Malpractice.”
There also was a count II---“Negligent and
Fraudulent Misrepresentation.”
6
MCL 600.5805(4); MSA 27A.5805(4).
7
In their brief in support of the motion, Messrs. Martin
and Hoskow relied on MCR 2.116(C)(7) and (8).
2
court agreed that the malpractice claim was not timely, and
dismissed the complaint on that basis.8
The Court of Appeals affirmed.9
Judge
WHITBECK
dissented,
expressing
In a separate opinion,
the
belief
that
the
malpractice claim had been filed timely.10
Dr. Levy has applied to this Court for leave to appeal.
II
As indicated, the limitation period for a malpractice
claim is two years.11
The present dispute concerns the date
on which Dr. Levy’s malpractice claim accrued, i.e., the date
on which the two-year period began to run.
To resolve this issue, we turn to MCL 600.5838; MSA
8
Actually, the court dismissed count I on that basis.
The court also granted summary disposition on count II on the
ground that the compliant did not contain specific allegations
of fraud, and thus did not (except insofar as it reiterated
the untimely malpractice claim) state a claim on which relief
can be granted.
9
Unpublished opinion per curiam issued September 17,
1999 (Docket No. 207797).
10
Judge WHITBECK concurred in the affirmance
summary disposition of count II.
11
of
the
A malpractice claim is barred unless filed within the
two-year period “or within 6 months after the plaintiff
discovers or should have discovered the existence of the
claim, whichever is later.” MCL 600.5838(2); MSA 27A.5838(2).
In light of our disposition of this matter, it is unnecessary
to consider whether the six-month discovery provision is
applicable to this case.
3
27A.5838.12
That section13 provides that a malpractice claim
“accrues at the time that person discontinues serving the
plaintiff in a professional . . . capacity as to the matters
out of which the claim for malpractice arose, regardless of
the time the plaintiff discovers or otherwise has knowledge of
the claim.”
MCL 600.5838(1); MSA 27A.5838(1).
In Morgan v Taylor, 434 Mich 180; 451 NW2d 852 (1990),
this Court explained this “last treatment rule,” from its
development in De Haan v Winter, 258 Mich 293, 296-297; 241 NW
12
Questions of statutory interpretation are decided de
novo. Northern Concrete Pipe, Inc v Sinacola Cos---Midwest,
Inc, 461 Mich 316, 320, n 14; 603 NW2d 257 (1999).
13
(1) Except as otherwise provided in [MCL
600.5838a; MSA 27A.5838(1), which concerns medical
malpractice], a claim based on the malpractice of a
person who is, or holds himself or herself out to
be, a member of a state licensed profession accrues
at the time that person discontinues serving the
plaintiff in a professional or pseudoprofessional
capacity as to the matters out of which the claim
for malpractice arose, regardless of the time the
plaintiff discovers or otherwise has knowledge of
the claim.
(2) Except as otherwise provided in [MCL
600.5838a; MSA 27A.5838(1), which concerns medical
malpractice], an action involving a claim based on
malpractice may be commenced at any time within the
[two-year limitation period of MCL 600.5805(4); MSA
27A.5805(4)], or within 6 months after the
plaintiff discovers or should have discovered the
existence of the claim, whichever is later. The
burden of proving that the plaintiff neither
discovered nor should have discovered the existence
of the claim at least 6 months before the
expiration of the period otherwise applicable to
the claim shall be on the plaintiff. A malpractice
action which is not commenced within the time
prescribed by this subsection is barred.
4
923
(1932),
through
the
subsequent
codification
in
MCL
600.5838; MSA 27A.5838 and the statutory amendments enacted as
1986 PA 178.
The plaintiffs in Morgan filed two complaints in 1985,
alleging malpractice in connection with a 1981 optometric
examination.
An examination also had been conducted in 1983,
less than two years before the complaints were filed, and the
issue in Morgan was whether “routine, periodic examinations”
extend the limitation period.
Resolving the question, this
Court wrote:
In the instant case defendant argues that the
rationale underlying the last treatment rule does
not apply in the context of routine, periodic
examinations. It is contended that there is no air
of truthfulness and trust once the examination is
concluded.
We disagree.
It is the doctor's
assurance
upon
completion
of
the
periodic
examination that the patient is in good health
which induces the patient to take no further action
other
than
scheduling
the
next
periodic
examination.
Particularly in light of the contractual
arrangement which bound defendant and entitled
plaintiff to periodic eye examinations,[14] it cannot
be said that the relationship between plaintiff and
defendant terminated after each visit.
The
obligation and responsibility of defendant to
provide glaucoma testing extended beyond the 1981
examination of plaintiff's eyes. We conclude that
defendant
did
not
discontinue
"treating
or
otherwise serving"[15] plaintiff "as to the matters
14
The patient in Morgan was entitled, under a contract
between his employer and his labor union, to an eye
examination every two years.
15
As one can see in footnote 13, the statute is now
framed only in terms of “serving” the plaintiff. That change
is related to the Legislature’s decision to eliminate the last
5
out of which the claim for malpractice arose" until
August 18, 1983. Thus, we hold that the claim of
plaintiff is not barred by the statute of
limitations.19
Since the facts here are unique, and the
Legislature has now repealed the last treatment
rule as it applied to medical malpractice,[16] we
limit our holding to the facts of this case.
__________________________________________________
19
There is no suggestion that this plaintiff returned to
[the optometrist] on August 18, 1983, merely to extend the
statutory period of limitations.
Our decision might be
different if there were evidence that such a visit had been made
as a mere artifice to extend the limitations period.
__________________________________________________
[434 Mich 194.]
III
In the present case, the Court of Appeals said that
“[t]he preparation of yearly tax returns is not analogous to
the periodic eye examinations in Morgan v Taylor, 434 Mich
180; 451 NW2d 852 (1990),” since “[e]ach individual tax return
reflects the examination of a discrete, contained body of
information.”
Writing in dissent, Judge WHITBECK disagreed about the
applicability of Morgan.
the
statute
was
He countered that its analysis of
“instructive
circumstances, controlling.”
and,
in
appropriate
He continued with an analysis
that we find persuasive, and adopt as our own:
treatment rule with respect to medical malpractice claims.
See Morgan, 434 Mich 192, n 17, and MCL 600.5838(1); MSA
27A.5838(1) and MCL 600.5838a; MSA 27A.5838(1) as amended and
enacted, respectively, by 1986 PA 178.
16
See footnote 15.
6
I consider a faithful application of the legal
principles enunciated in Morgan to control the
issue at hand. A health professional and patient
on the one hand are similarly situated in this
regard to an accountant who provides annual income
tax preparation services and the accountant’s
client.
As, under the rationale of the last
treatment rule, a patient was (before the amendment
of § 5838[1] making it inapplicable to medical
malpractice claims) entitled to rely “completely”
on the health professional and not inquire into the
effectiveness of the health professional’s measures
prior to the termination of the relationship, an
accountant’s client is likewise entitled to rely
“completely” on the account’s [sic: accountant’s]
skills and effectiveness until the termination of
the relationship.
A patient who attended a
periodic examination and was not diagnosed with any
medical problem was under the rationale of the last
treatment rule provided with an “assurance” of good
health that induced the patient to take no further
action to investigate the pertinent health matters
until the next periodic examination. Likewise, a
client who entrusts preparation of annual tax
returns to an accountant is provided with an
assurance of professional preparation of the tax
returns that induces the client to take no further
action regarding those matters until it is time to
prepare the next year’s tax returns. As discussed
above, accepting the well-pleaded allegations of
the complaint as true, [Home Ins Co v Detroit Fire
Extinguisher Co, Inc, 212 Mich App 522, 527-528;
538 NW2d 424 (1995)], defendants prepared annual
tax returns for plaintiffs from 1974 until
1996---encompassing the times of the alleged
professional negligence in preparing the 1991 and
1992 tax returns. Thus, I conclude that, based on
the
well-pleaded
allegations
of
plaintiffs’
complaint, under the last treatment rule of
§ 5838(1) as explained in Morgan, plaintiffs’
possible claim did not accrue---meaning the statute
of limitations did not begin to run---until at least
1996. The complaint in this case was filed in 1997
and thus was plainly within the applicable
limitation period, which was two years as noted by
the majority. Thus, in my view, the trial court
erred by granting summary disposition in favor of
defendants under MCR 2.116(C)(7) based on the
statute of limitations.
I respectfully disagree with the majority’s
7
attempt to distinguish the “continuing care of one
patient’s set of eyes in Morgan, supra,” from what
the majority describes as “the series of unrelated
tax calculations in this case.” . . . The
touchstone of the analysis in Morgan was the
continuing professional relationship between a
professional
and
the
person
receiving
the
professional’s services with regard to a particular
subject matter, not any direct connection between
the
work
performed
by
the
professional
at
continuing
periodic
sessions
during
that
relationship.
The alleged negligence in Morgan
occurred during a glaucoma test on the principal
plaintiff in Morgan at a 1981 eye examination.
Morgan, supra at 182-183. The principal plaintiff
in Morgan did not return to the defendant optical
company for an examination until 1983 for his next
routine eye examination. Id. at 182. There is no
indication in Morgan that the manner in which the
eye examination was conducted in 1983 had any
direct connection to the performance of the 1981
glaucoma test.
Nevertheless, the Morgan Court
concluded that, due to the statutory “last
treatment” rule, the statute of limitations with
regard to alleged negligence in the 1981 glaucoma
test did not begin to run on the date it was
performed because of the continuing professional
relationship between the patient and the optical
company.
Similarly, in this case, plaintiff s’ complaint
alleges, without any contrary documentary evidence
in the record, the existence of a continuing
relationship of tax preparer and client that did
not end until 1996.
Until the end of that
relationship, for purposes of applying the “last
treatment” rule and thereby ascertaining whether
the statute of limitations bars this suit,
plaintiffs had “no duty to inquire into the
effectiveness of [defendants’] measures” until the
end of the professional relationship. Id. at 188
(citation omitted).3
I note that it may (or may not) be wise for
MCL 600.5838(1); MSA 27A.5838(1) to be amended to
completely abolish the “last treatment” rule.
However, “[t]he wisdom of the provision in question
in the form in which it was enacted is a matter of
legislative responsibility with which the courts
may not interfere.” Morgan, supra at 192, quoting
Melia v Employment Security Comm, 346 Mich 544,
8
561; 78 NW2d 273 (1956). Our duty is to faithfully
apply the legislatively adopted policy of the “last
treatment”
rule
to
claims
of
professional
malpractice, other than medical malpractice, not to
attempt to limit that policy by an unduly narrow
application.
__________________________________________________
3
However, I further question the majority’s apparent view
of the preparation of each year’s tax returns as inherently
involving a completely separate transaction on the basis of
“common sense.”
Depending on its complexity and the tax
situation of the taxpayer, a given tax return may (or may not)
reflect “the examination of a discrete, contained body of
information.”
I think it is fairly well recognized, for
example, that, especially with regard to business income
taxation, certain matters such as depreciation of business
assets and eligibility for certain tax credits often depend on
facts that extend further into the past than the prior tax year.
Thus, from the current state of the record, it is not clear that
each instance of preparation of annual income tax returns by
defendants involved calculations and judgments that lacked any
direct connection to their preparation of income tax returns in
prior years.
__________________________________________________
[Emphasis in original.]
We respectfully disagree with the dissent’s assertion
that this case should be distinguished from Morgan on the
ground that Morgan involved the continuing treatment of the
same
set
of
calculations.
eyes
while
this
case
involves
discrete
tax
The basis for our disagreement comes from a
review of the development of the last treatment rule in
Michigan.
Over six decades ago, in De Hann, supra at 296-297, this
Court applied the common-law last treatment rule in holding
that
a
patient’s
claim
of
professional
malpractice
for
treatment of a fracture in his leg did not commence to run
“while treatment of the fracture continues” as “[d]uring the
course of treatment plaintiff was not put to inquiry relative
to the treatment accorded him.” Thereafter, codifying what it
9
wished to have as the last treatment rule, the Legislature, as
part of the Revised Judicature Act, enacted MCL 600.5838; MSA
27A.5838 in its original form:17
A claim based on the malpractice of a person
who is, or holds himself out to be, a member of a
state licensed profession accrues at the time that
person discontinues treating or otherwise serving
the plaintiff in a professional or psuedo
professional capacity as to the matters out of
which the claim for malpractice arose.
This statute constituted not only a codification, but also an
expansion of the common-law last treatment rule.
First, the
statute expanded the common-law rule because it applied to a
“member of a state licensed profession” meaning that the last
treatment rule was extended not just to medically licensed,
but to nonmedical state licensed professionals. Moreover, the
statutory language “discontinues treating or otherwise serving
the plaintiff . . . as to the matters out of which the claim
for malpractice arose” extended the last treatment rule of De
Haan to maters other than treating a specific recognized
injury.
How broadly to read “the matters out of which the
claim for malpractice arose” was addressed by this Court in
Morgan. There, unlike the situation in De Haan, the plaintiff
was not receiving treatment for a specific ailment, but rather
was receiving periodic eye examinations from the defendants.
This Court held that it was those examinations, not any
17
The current version of MCL 600.5838(1);
27A.5838(1) is substantively the same, except for
exclusion of claims of medical malpractice from
provisions.
10
MSA
its
its
injury, that constituted “the matters out of which the claim
for malpractice arose.”18
Using the same reasoning, it is
clear here that plaintiffs, rather than receiving professional
advice for a specific problem, were receiving generalized tax
preparation
services
from
defendants.
These
continuing
services, just like the continuous eye examinations in Morgan,
to be consistent with the Morgan approach, must be held to
constitute “the matters out of which the claim for malpractice
arose.”19
18
While not articulated in Morgan, we note that its
result seems to find support in the statute’s use of the
plural term “matters” in the phrase “the matters out of which
the claim for malpractice arose.” Plainly, this means that
the statute of limitations for a nonmedical malpractice claim
against a state licensed professional does not begin to run
when the professional has ceased providing services with
regard to a single matter. On the contrary, the statute of
limitations begins to run only when the professional has
ceased providing services as to the broad “matters” out of
which the claim arises.
This indicates that a continuing
course of eye examinations (or preparation of income tax
returns) should be considered the “matters” out of which a
claim for malpractice arose for purposes of the statute,
rather than considering the completion of each eye examination
(or tax preparation) to begin running the statute of
limitations with respect to negligence during that singular
matter. In addition, the phrase “discontinues serving” as
used in MCL 600.5838; MSA 27A.5838 should not be ignored or
overlooked.
Defendants in this case did not discontinue
serving plaintiffs with regard to accounting matters until
well after the preparation of the 1992 income tax returns.
19
We note that we are reviewing this case in the context
of a motion for summary disposition brought by defendants
under MCR 2.116(C)(7) based on the statute of limitations. In
bringing such a motion, a defendant may, but is not required
to, submit documentary evidence in support of its assertion
that a claim is barred by the statute of limitations. See
Patterson v Kleiman, 447 Mich 429, 432; 526 NW2d 879 (1994).
However, in the present case, defendants have not offered
11
Finally, the dissent raises the specter of a very long
delayed
claim
being
possible
under
MCL
600.5838(1);
27A.5838(1) based on the rationale of this opinion.
at 11.
MSA
Slip op
It is certainly true that the last treatment rule as
codified and expanded by MCL 600.5838(1); MSA 27A.5838(1) may
allow suits against non-medical professionals based on alleged
negligence that has occurred much farther in the past than
would be the case absent that statutory provision.
However,
for better or worse, we believe that such an extended statute
of limitations is precisely the point of MCL 600.5838(1); MSA
27A.5838(1)
as
currently
enacted.
Policy
arguments
for
changing the statute may be addressed to the Legislature, but
we must endeavor to apply the statute in light of its plain
documentary evidence regarding the nature of the professional
services that were provided by defendants to plaintiffs. As
Judge WHITBECK stated below, in the absence of any documentary
evidence on a point, in reviewing a summary disposition motion
under MCR 2.116(C)(7) we must accept the well-pleaded
allegations in a complaint as true. Plaintiffs alleged that
defendants prepared their income tax returns from 1974 to
1996. Defendants have failed to present any evidence that
this is untrue—or that each income tax preparation was a
discrete transaction that should be considered to separately
constitute “the matters out of which the claim for malpractice
arose,” MCL 600.5838(1); MSA 27A.5838(1), for purposes of the
last treatment rule. Accordingly, we conclude that defendants
have not established that plaintiffs’ claims are barred by the
statute of limitations. We note that the result may have been
different if defendants had come forward with documentary
evidence that each annual income tax preparation was a
discrete transaction that was in no way interrelated with
other transactions. Accordingly, this opinion does not mean,
for example, that if an accountant prepared income tax returns
for a party annually over a period of decades, the statute of
limitations for alleged negligence in preparing the first of
these tax returns would not run until the overall professional
relationship ended.
12
language,
well-established
principles
of
statutory
construction, and this Court’s prior construction of the
statute in Morgan.20
For these reasons, we reverse in part the judgments of
the circuit court and the Court of Appeals.21
We remand this
case to the circuit court for further proceedings on the
plaintiffs’ malpractice claim against the defendants.
MCR
7.302(F)(1).
KELLY , TAYLOR , CORRIGAN , and YOUNG , JJ., concurred.
CAVANAGH , J., concurred in the result only.
20
It is to be recalled that neither the majority nor the
dissent challenges the soundness of the Morgan rationale.
21
We have reviewed the plaintiffs’ other claims on
appeal, including his contention that the circuit court erred
in granting summary disposition on count II of the complaint,
and we are not persuaded that additional relief should be
granted.
13
S T A T E
O F
M I C H I G A N
SUPREME COURT
MARTIN I. LEVY and
MARTIN I. LEVY, DDS, P.C.,
Plaintiffs-Appellants,
v
No.
115603
MARK L. MARTIN, GERALD HOSKOW,
and HOSKOW & MARTIN, P.C.,
Defendants-Appellees.
_________________________________
MARKMAN, J.
I
(dissenting).
respectfully
disagree
with
and
dissent
from
the
majority’s conclusion that the “last treatment” rule served to
keep plaintiff’s professional malpractice action viable in
this case.1
correctly
Rather, I believe that the Court of Appeals
affirmed
the
trial
court’s
grant
of
summary
disposition in defendants’ favor.
From the very limited record in this case, it appears
that defendants were hired by plaintiffs to act as their
personal
and
corporate
accountants.
Defendants
prepared
plaintiffs’ annual tax returns for the years 1974 through
1
I concur with the majority’s determination that
plaintiff’s other claims on appeal are not worthy of
additional relief.
1996, a period of twenty-two years. Plaintiffs’ 1991 and 1992
tax returns were audited by the Internal Revenue Service (IRS)
in 1994, with the IRS presenting plaintiffs with a notice of
deficiency in December 1995.
two-count
complaint
Plaintiffs subsequently filed a
against
defendants
in
August
1997,
alleging professional negligence and fraud.
In lieu of answering plaintiffs’ complaint, defendants
filed a motion for summary disposition under MCR 2.116(C)(7)
(expiration of the applicable limitation period) and (8)
(failure
to
state
a
claim).
The
circuit
court
granted
defendants’ motion, and the Court of Appeals affirmed, with
Judge WHITBECK dissenting.
This
Court
reviews
the
grant
or
denial
of
summary
disposition de novo. Maiden v Rozwood, 461 Mich 109, 118; 597
NW2d 817 (1999).
Similarly, we review questions of statutory
construction de novo as a matter of law.
Sands Appliance
Services, Inc v Wilson, 463 Mich 231, 238; 615 NW2d 241
(2000); Donajkowski v Alpena Power Co, 460 Mich 243, 248; 596
NW2d 574 (1999).
The
essential
plaintiffs’
claim
question
of
in
this
professional
case
is:
malpractice
When
did
accrue
for
purposes of applying the pertinent limitation period?
600.5805; MSA 27A.5805 provides that
[a] person shall not bring or maintain an action to
recover damages for injuries to persons or property
unless, after the claim first accrued to the
plaintiff or to someone through whom the plaintiff
2
MCL
claims, the action is commenced within the periods
of time prescribed by this section.
* * *
(4) Except as otherwise provided in this chapter,
the period of limitations is 2 years for an action
charging malpractice.
With
regard
to
the
time
of
accrual
of
a
professional
malpractice claim, other than one for medical malpractice,2
MCL 600.5838(1); MSA 27A.5838(1) states that
a claim based on the malpractice of a person who
is, or holds himself or herself out to be, a member
of a state licensed profession accrues at the time
that person discontinues serving the plaintiff in a
professional or pseudoprofessional capacity as to
the matters out of which the claim for malpractice
arose, regardless of the time the plaintiff
discovers or otherwise has knowledge of the claim.
[Emphasis added.]
An
action
involving
a
claim
based
on
professional
malpractice (other than medical malpractice) may be commenced
at any time within the applicable period prescribed in MCL
600.5805(4); MSA 27A.5805(4), or within six months after the
plaintiff discovers or should have discovered the existence of
the
claim,
27A.5838(2).
whichever
is
later.
MCL
600.5838(2);
A malpractice action that is not commenced
within the time prescribed by this subsection is barred.
The
MSA
cardinal
rule
of
statutory
construction
is
Id.
to
identify and give effect to the intent of the Legislature.
2
The accrual of a medical malpractice claim is
determined pursuant to MCL 600.5838a; MSA 27A.5838(1).
3
Helder v Sruba, 462 Mich 92, 99; 611 NW2d 309 (2000).
The
first step in discerning intent is to examine the language of
the statute.
Id.
If the language of a statute is clear and
unambiguous, the plain meaning of the statute reflects the
legislative intent and judicial construction is not permitted.
Western Michigan Univ Bd of Control v Michigan, 455 Mich 531,
538; 565 NW2d 828 (1997).
“Each word of a statute is presumed
to be used for a purpose, and, as far as possible, effect must
be given to every clause and sentence.”
Robinson v Detroit,
462 Mich 439, 459; 613 NW2d 307 (2000).
In Michigan, the “last treatment” rule originated in De
Haan v Winter, 258 Mich 293; 241 NW2D 923 (1932).
At that
time, the limitations statute contained no provision fixing
the accrual point of a malpractice action.
As in the present
case, the De Haan Court was faced with the question:
When did plaintiff’s cause of action accrue?
Until treatment of the fracture ceased the relation
of patient and physician continued, and the statute
of limitations did not run. [Citations omitted.]
While decisions are not in accord upon this
question, we are satisfied that in such an action
as this the statute of limitations does not
commence to run while treatment of the fracture
continues. Failure to give needed continued care
and treatment, under opportunity and obligation to
do so, would constitute malpractice.
During the
course of treatment plaintiff was not put to
inquiry relative to the treatment accorded him.
[Id. at 296-297 (emphasis added).]
The legislative comment accompanying the 1961 enactment of §
5838, indicates that “[s]ection 5838 is based on the rule
4
stated and followed in the Michigan case of De Haan.”
Morgan
v Taylor, 434 Mich 180, 187, n 13; 451 NW2d 852 (1990).3
“The rationale for the last treatment rule has been
explained on grounds that the patient, while his treatment
continues, ‘relies completely on his physician and is under no
duty
to
inquire
into
the
effectiveness
of
measures.’” Id. at 187-188 (emphasis added).
important
to
reiterate
the
facts
of
the
latter’s
I believe it is
Morgan,
a
medical
malpractice case. In Morgan, the plaintiff was an employee of
D.W. Zimmerman Company and a member of United Auto Workers
(UAW) Local 417.
Zimmerman and the UAW contracted with the
defendant Cooperative Optical Services, Inc. (COS); under the
contract,
each
covered
employee
examination every two years.
was
entitled
to
an
eye
The plaintiff received eye
examinations by COS staff in 1976, 1978, and on March 7, 1981,
and August 18, 1983.
March
1981
Id. at 182.
examination,
a
test
During the plaintiff’s
for
glaucoma
intraocular pressure beyond the normal range.
COS optometrist failed to
indicated
However, the
take any further action.
During
the plaintiff’s August 1983 examination, abnormal intraocular
pressure was again detected and the plaintiff was referred to
3
The “last treatment” rule announced in De Haan v
Winter, supra at 241, was codified in 1961 PA 236, the Revised
Judicature Act of 1961, MCL 600.5838; MSA 27A.5838. The rule
was later amended by 1975 PA 142, and later repealed, as to
medical malpractice actions, by 1986 PA 178.
5
an ophthalmologist, who determined that the plaintiff had
incurred
irreversible
pressure.
nerve
Id. at 183.
damage
due
to
the
abnormal
The plaintiff sued, and the trial
court found that the August 1983 examination amounted to “a
continuation of treatment or services” within the meaning of
MCL 600.5838(1); MSA 27A.5838(1); thus, the plaintiff’s claim
of malpractice “was not barred by the statute of limitations
because it had been filed within two years of the date the
action accrued.”
Id. at 184.
In the present case, the majority relies on the Court of
Appeals dissent, which in turn relied on this Court’s analysis
in Morgan, supra. Respectfully, I disagree with the dissent’s
assertion that “[t]he touchstone” of the “last treatment” rule
is
the
“continuing
professional
and
services . . . .”
professional
the
person
relationship
receiving
the
between
a
professional’s
Unpublished opinion per curiam, issued
September 17, 1999 (Docket No. 207797)(WHITBECK , J., concurring
in part and dissenting in part), slip op at 4 (emphasis in the
original).
The plain language of subsection 5838(1) does not state
that a claim of professional malpractice accrues on the last
date of service (i.e., “last date of treatment”), period.
Rather, the statutory language clearly defines the point of
accrual, confining the last date of service expressly to those
matters “out of which the claim for malpractice arose”; from
6
this language, certainly, a professional relationship may
continue on even though a malpractice claim arising out of
that relationship has accrued and the clock has started to run
with regard to the two-year limitation period.
The Court of
Appeals dissent and the majority’s adoption of the dissent’s
analysis without explanation fail to acknowledge and give
effect to the plain language of the entire sentence comprising
subsection 5838(1), thereby rendering the modifying phrase
“matters
out
of
which
the
claim
for
malpractice
arose”
superfluous.
The majority
asserts that, in enacting § 5838, the
Legislature “extended” or “expanded” upon the common-law “last
treatment” rule set forth in De Haan.
See slip op at 10.
However, in my judgment, the legislative comment that § 5838
“is based on the rule stated and followed in the Michigan case
of De Haan” effectively militates against the majority’s
assertion.
The facts in De Haan involved a distinct period of
medical treatment, relating to a distinct medical condition,
with this Court concluding that a
malpractice,
arising
“[d]uring
claim of professional
the
course
of
[that]
treatment,” would not be barred by the limitation period as
long
as
that
particular
particular
medical
Specifically,
De
course
condition,
Haan
did
not
of
treatment,
continued.
determine
Id.
that
for
that
at
297.
once
the
treatment of the plaintiff’s fracture ceased, his claim of
7
professional malpractice, arising out of the treatment for the
fracture, remained viable as long as a physician-patient
relation continued.
The phrase “as to the matters out of which the claim for
malpractice
arose,”
found
in
subsection
5838(1),
clearly
equates with the phrases “[u]ntil treatment of the fracture
ceased” and “[d]uring the course of treatment” found in De
Haan.
Id. at 296, 297.
Moreover, Morgan refers to the De
Haan language “while . . . treatment continues” in attempting
to explain the rationale for the “last treatment” rule.
Mich 187.
434
Importantly, this Court, in determining that the
facts of Morgan were “unique,” limited its holding to the
facts of that case.
Id. at 194.
Thus, I can discern no
logical force to the suggestion that the Legislature intended
to broaden the common-law “last treatment” rule, as stated and
applied in De Haan, when it drafted the language of § 5838.
Further, the facts in the present case, although very
sparse for purposes of appellate review, are nevertheless
quite distinguishable from the facts found in Morgan, supra.
In Morgan, there was a requirement under an employer/union
contract that the plaintiff be given an opportunity to have
his eyes examined and reevaluated every two years.4
4
Granted,
I find the existence of a contractual agreement in
Morgan a highly distinguishable fact not present in the
instant case.
I believe that this Court, in Morgan, also
(continued...)
8
there may have been changes that occurred in the plaintiff’s
eyes between visits, but it would be necessary to address
these
changes
in
the
context
of
the
condition
of
the
plaintiff’s same eyes, determined at the last visit and every
visit before that. There was certainly an interrelation, even
an interdependency, between one eye examination and the next
because the same eyes were being examined each time.
However, plaintiffs’ annual tax returns in the present
case cannot be considered analogous to the plaintiff’s eyes in
Morgan.
The preparation of annual tax returns involves the
compilation and computation of a distinct and discrete body of
information, generally not the same from year to year.
In
other words, in each successive year, a client is not bringing
to his accountant the same aggregation of receipts to be
reevaluated and reexamined, to discern if some change has
taken place in that particular body of information and data.
Rather, the client generally brings in a new aggregation of
receipts specific and distinct to the year for which the tax
return is being completed.
An accountant is generally not
4
(...continued)
considered the contractual agreement
importance in reaching its decision:
to
be
of
peculiar
Particularly in light of the contractual
arrangement which bound defendant and entitled
plaintiff to periodic eye examinations, it cannot
be said that the relationship between plaintiff and
defendant terminated after each visit. [Id. at 194
(emphasis added).]
9
“caring for” the client’s same tax return from year to year,
as a physician cares for the same set of eyes, or the same
liver, kidneys, or heart, from examination to examination.
Thus, in the present case, each successive annual tax return
represented
“the
matters
out
of
which
the
claim
for
malpractice arose,” a phrase to which the Court of Appeals
dissent and the majority here give little apparent effect.
Further, I do not share the Court of Appeals dissent’s
concern that “with regard to business income taxation, certain
matters
such
as
depreciation
of
business
assets
and
eligibility for certain tax credits often depend on facts that
extend further into the past than the prior tax year.”
op at 5, n 3.
Slip
While such an assertion may or may not be
accurate, the important factor is that the body of information
and data used each successive year to compile, compute, and
prepare an income tax return is not the same; it is not
analogous to the same set of eyes or the same liver or the
same heart that is examined and evaluated by a physician at
each office visit.
The fact that there may be some common
information that is used in preparing an annual income tax
return does not change the fact that it is used in conjunction
with an entirely different and distinct amalgam of information
and data collected specifically for each year for which the
tax return is being prepared, an amalgam representing the
“matters out of which the claim for malpractice [may arise]”
10
for
purposes
of
establishing
the
claim’s
accrual
date.
Subsection 5838(1).5
5
In the present case, the only allegations specifically
made by plaintiffs, in bringing their claim of malpractice,
are that: (1) the professional relationship with defendants
existed from 1974-1996, (2) the IRS audited the annual returns
in two of those years, 1991-92, and (3) pursuant to this
audit, plaintiffs were assessed additional taxes for these two
years. Plaintiffs here presented no allegations that any of
the individual annual tax returns completed by defendants over
the twenty-two-year professional relationship contained any
information or data that carried over from one year to the
next, or that each annual tax return was not otherwise
separate and distinct.
However, the majority here would place the burden upon
the defendant to come forward, in bringing a motion for
summary disposition pursuant to MCR 2.116(C)(7), with
additional evidence establishing that the entirety of the
professional relationship did not consist of “the matters out
of which the claim for malpractice arose,” in order to prevail
against a plaintiff’s assertion that the claim for malpractice
did not accrue until the end of the professional relationship.
Slip op at 12 n 19. I do not agree with this allocation of
the burden in the application of subsection 5838(1). Under
the majority’s approach, it appears that as long as a
plaintiff pleads the existence of a professional relationship,
“the matters out of which the claim for malpractice arose”
will be presumed to consist of the entire duration of the
relationship, a presumption which, in my judgment, runs
contrary to the statutory language of subsection 5838(1).
The majority’s argument would be more compelling if the
instant matter involved the treatment of, or the provision of
service to, the same eyes, the same pancreas, the same heart,
or any other object or transaction that is treated or serviced
on a continuing or interrelated basis. Thus, arguably it may
be incumbent upon a defendant, when faced with a professional
malpractice action involving such an object or transaction, to
come forward with additional evidence demonstrating that one
provided treatment or service was distinct from another. But
here, in my judgment, the individual annual tax returns cannot
truly be equated with the same set of eyes, pancreas, heart,
or other object or transaction that is treated or serviced on
a continuing or interrelated basis. Thus, I believe that it
is the plaintiff’s burden, not the defendant’s, to set forth
(continued...)
11
In
the
[plaintiffs’]
present
claim
case,
for
the
“matters
malpractice
out
of
arose”
which
involved
defendants’ preparation of their 1991 and 1992 income tax
returns.
5838(1),
Thus,
under
plaintiffs’
the
claim
plain
of
language
of
professional
subsection
malpractice
accrued, and the two-year limitation period began to run, when
defendants worked their last day with regard to these distinct
returns.
Even assuming that defendants worked on plaintiffs’
1992 tax return through December 1993, plaintiffs’ cause of
action for malpractice was barred by subsection 5805(4) on the
last day of December 1995.
Plaintiffs’ complaint was not
filed until August 1997.6
5
(...continued)
well-pleaded allegations evidencing that there existed some
connection between treatments or services occurring within the
professional relationship.
In stating that “it is clear here that plaintiffs, rather
than receiving professional advice for a specific problem,
were receiving generalized tax preparation services from
defendants,” slip op at 11-12, the majority gainsays the
discrete nature of each individual annual tax return prepared
by defendant, and essentially considers the termination of the
professional relationship itself (i.e., the end of plaintiffs
“receiving generalized tax preparation services”) as the point
at which plaintiffs’ claim for malpractice accrued.
The
statutory phrase “as to the matters out of which the claim for
malpractice arose” is, thus, given little effect. Essentially
then, my concerns about the majority’s allocation of the
burdens in (C)(7) motions parallel my larger concerns about
the majority’s focus upon the professional relationship in a
malpractice action rather than upon the “matters out of which
the claim for malpractice arose.”
6
I do not believe it is necessary to elaborate on the
(continued...)
12
The
Court
of
Appeals
dissent’s
analysis,
and
the
majority’s reliance on this analysis, effectively erode the
policy bases for having statutory limitation periods in the
first place.
Obviously, while one policy base is to afford
plaintiffs a reasonable opportunity to bring suit, statutes of
limitation are also intended to: (1) compel the exercise of a
right of action within a reasonable time so that the opposing
party has a fair opportunity to defend; (2) relieve a court
system from dealing with stale claims, where the facts in
dispute
occurred
forgotten
or
so
long
ago
manufactured;
that
and
evidence
(3)
was
protect
either
potential
defendants from protracted fear of litigation. Chase v Sabin,
445 Mich 190, 199; 516 NW2d 60 (1994).
Asserting, as the Court of Appeals dissent does in the
present
case,
that
the
termination
of
the
professional
relationship is the beginning and end of the analysis in
determining when a professional malpractice claim has accrued,
tolls the limitation period in a potentially large number of
professional malpractice cases, pending the ultimate and final
termination of the professional relationship.
6
Under the
(...continued)
six-month discovery rule of MCL 600.5838(2); MSA 27A.5838(2).
Plaintiffs knew as early as December 1995, when they received
the IRS deficiency notice, that a possible cause of action
existed against defendants. See Solowy v Oakwood Hosp Corp,
454 Mich 214, 223; 561 NW2d 843 (1997)(once a plaintiff is
aware of an injury and its possible cause, the plaintiff is
equipped with the necessary knowledge to preserve and
diligently pursue his claim).
13
majority’s
interpretation
of
subsection
5838(1),
a
professional relationship may exist for one hundred years; if,
perchance, malpractice was committed in the very first year of
the relationship, a claim could potentially remain viable for
another 101 years.
Certainly, a reasonable time would have
long since passed, thereby undermining the opposing party’s
ability to defend such a stale claim, extending the potential
defendant’s apprehension of litigation to unreasonable and
unacceptable lengths, and unnecessarily burdening the judicial
system with claims so stale as to be virtually untriable. See
Chase, supra.
In enacting § 5838, it is reasonable to conclude that
the Legislature addressed the conflict between the accrual of
a simple tort claim, which generally involves but a single act
or omission, and the accrual of a professional malpractice
claim, where actual malpractice may occur within an extended,
but nevertheless distinct, period of continuing professional
service.7
7
For example, in 1990, Mr. Smith is sued in a
premises liability action. He retains Lawyer Jones for the
purpose of legal representation. Because he is an extremely
busy professional, Lawyer Jones overlooks the issue of
personal jurisdiction in the action against Mr. Smith, fails
to object to the clear absence of such jurisdiction, and,
instead, files an answer on Mr. Smith’s behalf, effectively
waiving the issue. After extended discovery, the litigation
proceeds to trial and ultimately, in 1995, to a large jury
verdict against Mr. Smith. Lawyer Jones persuades Mr. Smith
to appeal the verdict and Mr. Smith consents.
During the
pendency of the appeal process, Mr. Smith, in 1996, is
(continued...)
14
The
“matters
out
of
which
[plaintiffs’]
claim
for
7
(...continued)
involved in an automobile accident and is sued by a person who
was a passenger in the car with which Mr. Smith collided. Mr.
Smith again retains Lawyer Jones to represent his legal
interests in this second case. In 1997, the Michigan Court of
Appeals affirms the 1995 jury verdict against Mr. Smith and he
satisfies himself that further appeal is futile. The 1996
automobile accident lawsuit involves protracted litigation and
continues into 2001 when it is finally set for trial.
Fortunately for Mr. Smith, a jury, in 2002, returns a verdict
of no cause of action regarding the 1996 automobile accident
lawsuit.
Before the enactment of § 5838, the general tort statute
of limitation would have applied, and Mr. Smith’s
claim
against Lawyer Jones, for failing to object to personal
jurisdiction in the first lawsuit, would have accrued in 1990,
at the time the malpractice occurred, MCL 600.5827; MSA
27A.5827, and the limitation period would have run three years
after the actual act of malpractice. MCL 600.5805(9); MSA
27A.5805(9).
However, after the enactment of § 5838, in
applying the plain language of this statute to this example,
Mr. Smith’s malpractice claim would have accrued in 1997, at
the end of Lawyer Jones’ representation of Mr. Smith in the
1990 premises liability action; the limitation period would
have run two years later. MCL 600.5805(5); MSA 27A.5805(5).
A second example might involve a patient visiting a
dentist on five separate occasions for the purpose of
repairing a tooth. In the course of this treatment, a root
canal is necessary, and the dentist negligently damages the
nerve that serves the tooth, causing severe and chronic jaw
pain.
The purpose of subsection 5838(1), prior to the
enactment of § 5838a, would be served in its application
because there would be no necessity to parse out the visits,
thereby placing an extremely confusing burden on the parties
or factfinder, to identify which specific visit resulted in
the negligently provided treatment.
It would only be
necessary to examine the entire sequence of events, regarding
that course of treatment, to determine the accrual date of the
plaintiff’s claim of professional malpractice.
Thus, a very different result is obtained under the facts
of either example when the plain language of subsection
5838(1) is applied, compared with the result obtained under
the general tort statute of limitation.
15
malpractice
arose”
involved
defendants’
preparation
of
plaintiffs’ 1991 and 1992 income tax returns. Pursuant to the
plain language of subsection 5838(1), the last date on which
defendants worked in preparing such returns was the date on
which plaintiffs’ claim `for professional malpractice accrued
for purposes of the running of the statute of limitations.
Because plaintiffs failed to file their complaint until well
after the applicable two-year limitation period had run, their
claim for professional malpractice, in my judgment, was time
barred
and
the
circuit
court
properly
granted
disposition in favor of defendants in this case.
therefore, affirm.
16
summary
I would,
S T A T E
O F
M I C H I G A N
SUPREME COURT
MARTIN I. LEVY and
MARTIN I. LEVY, D.D.S., P.C.,
Plaintiffs-Appellants,
v
No. 115603
MARK L. MARTIN, GERALD HOSKOW,
and HOSKOW & MARTIN, P.C.,
Defendants-Appellees.
________________________________
WEAVER, C.J. (dissenting).
I would grant leave to appeal in this case because I
believe the issue presented needs oral argument.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
