928 N.W.2d 292
Mich. Ct. App.2018Background
- Robert and Kimberly Broz operated S-corporation cellular businesses; Plante & Moran prepared their tax returns through 2006.
- The IRS audited and issued deficiency notices for multiple years; the Broz later filed protective amended returns and claimed a large 2002 net operating loss carryback.
- The Broz litigated the tax deficiencies in Tax Court and on appeal; after unfavorable federal rulings and IRS denial of the carryback, they sued Plante & Moran for accounting malpractice and related claims in 2012.
- On remand from a prior appellate ruling on ripeness, the trial court granted Plante & Moran summary disposition under MCR 2.116(C)(8) and (C)(10), dismissing malpractice, breach of contract, negligent misrepresentation, breach of fiduciary duty, and an equitable estoppel/indemnity claim.
- Central factual/legal disputes concern whether the Broz presented expert proof of the applicable standard of care and breach, whether an expert affidavit could cure perceived gaps in prior testimony, and whether non‑malpractice claims were duplicative of malpractice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MCL 600.2912a requires plaintiffs to prove an accounting standard of care and thus present expert testimony | The statute specific to accountants (MCL 600.2962) governs and obviates the need to prove a standard of care under MCL 600.2912a | Malpractice claims generally require proof of the recognized professional standard; MCL 600.2912a applies to malpractice actions and requires proof of standard and breach | Court held MCL 600.2912a applies to accounting malpractice; plaintiff must prove the standard of care and breach, usually via expert testimony |
| Whether plaintiffs’ expert (Oettinger) established the standard of care and breach | Oettinger’s report and deposition applied AICPA standards and described defendant’s errors; his later declaration clarified he concluded malpractice occurred | Defendant argued the expert never identified the applicable standard or tied specific conduct to a breach; affidavit contradicted prior testimony and cannot manufacture an issue | Court held Oettinger’s initial report/deposition did not specify the standard or link acts to a breach; the affidavit clarified but did not supply the required detailed standard/breach analysis, so malpractice claim fails |
| Admissibility/effect of expert affidavit submitted after deposition | Affidavit clarifies expert’s prior testimony and states defendant committed malpractice | Defendant contended affidavit contradicts deposition and cannot be used to defeat summary disposition | Court held affidavit could be considered to the extent it clarifies testimony, but it nonetheless failed to state the required standard/breach specifics; summary disposition proper |
| Whether breach of contract, negligent misrepresentation, fiduciary breach, and equitable estoppel claims survive separate from malpractice | These claims are materially distinct and permissible even if malpractice alleged | Defendant argued each claim’s gravamen duplicates malpractice; plaintiffs failed to plead separate duties or special agreement | Court held these claims were duplicative of malpractice because the complaint’s gravamen was inadequate professional services/advice; they were dismissed |
Key Cases Cited
- Lowrey v LMPS & LMPJ, Inc., 500 Mich. 1 (2016) (standard of review for summary disposition)
- Maiden v Rozwood, 461 Mich. 109 (1999) (pleading and summary disposition principles)
- Locke v Pachtman, 446 Mich. 216 (1994) (expert must establish standard of care in malpractice)
- Elher v Misra, 499 Mich. 11 (2016) (expert testimony usually required to show standard of care)
- Moning v Alfono, 400 Mich. 425 (1977) (definition of standard of care)
- Simko v Blake, 448 Mich. 648 (1995) (elements of malpractice claim and connection to contract)
- Stewart v Rudner, 349 Mich. 459 (1957) (malpractice arises from breach of duty in professional services)
- Local 1064, RWDSU, AFL-CIO v Ernst & Young, 449 Mich. 322 (1995) (accounting is a profession subject to malpractice)