Legal malpractice; Statute of repose; MCL 600.5838b; Contract interpretation

The court held that the trial court erred by granting defendant-law firm summary disposition of plaintiff’s legal malpractice action on the basis it was time-barred. Defendant initially represented plaintiff in an underlying property dispute. After plaintiff filed this suit, the parties entered into an agreement that this “lawsuit would be dismissed without prejudice and the statute of limitations would be tolled while” plaintiff litigated the underlying case. It lost that case, and resumed this one, claiming defendant’s negligence resulted in plaintiff losing title to the disputed land. But while the underlying case was still being litigated, the Legislature enacted MCL 600.5838b, which bars legal malpractice actions commenced “six years after the date of the act or omission that is the basis for the claim.” The trial court found that this litigation was barred by the statute of repose. On appeal, the court agreed with plaintiff that “the trial court’s interpretation of the agreement was erroneous because interpreting the tolling agreement as to include the statute of repose is consistent with the contract’s plain language and because excluding it is contrary to” the parties’ clear intent. The court noted it was “undeniable, both from the language of the agreement and the circumstances surrounding its formation, that the parties’ intent was that [plaintiff] would be allowed to bring its malpractice action against [defendant] without being time-barred at the conclusion of” the underlying case. It was also “undeniable that the parties did not intend that the action be time-barred by the statute of repose because the statute of repose did not exist” when the agreement was executed. In addition, “interpreting the contract as to toll the statute of repose is consistent with its plain language. The parties agreed to toll ‘[a]ll applicable Statutes of Limitation,’ and we conclude that the statute of repose fits within the term ‘Statutes of Limitation’ as it is used in this agreement.” And although “there is caselaw recognizing a distinction between statutes of limitations and statutes of repose . . . all rules of interpretation are subordinate to the goal of ascertaining the parties’ intent and interpreting the term in such a way as to include the statute of repose is consistent with the parties’ intent to waive time limitations so that [plaintiff] could litigate the underlying claim prior to bringing the malpractice action. The parties could not have intended for the statute of repose to remain effective given that it did not yet exist.” Reversed and remanded.