Legal malpractice; Statute of limitations; MCL 600.5805 & 600.5838; Gebhardt v O’Rourke; Harm for purposes of accrual; Equitable estoppel; Lothian v City of Detroit

Holding that plaintiffs’ legal malpractice claim was barred by the statute of limitations and that invoking the equitable estoppel doctrine was unwarranted, the court affirmed summary disposition for defendants. Plaintiffs contended their action was not time-barred because pursuant to MCL 600.5838(2), they filed it within six months of a related Delaware trial court judgment and that “judgment constituted the earliest date on which they could have reasonably discovered the alleged malpractice.” The court noted that the relevant limitations statutes were MCL 600.5805 and 600.5838, which the Michigan Supreme Court interpreted in the context of a legal malpractice claim in Gebhardt. Plaintiffs here “acknowledged that defendants stopped representing them on [1/21/21]. Plaintiffs knew of possible legal malpractice by [5/21], when they were named as defendants in the Delaware case based on” a letter written by defendant-Frenkel. They, “or their representative, had communicated with Frenkel, expressly conveying their position that the Delaware action was based solely upon statements made during his representation. The record demonstrates the existence of an attorney-client relationship, plaintiffs’ belief that Frenkel was negligent in his drafting of the [12/18/20], letter, and their conviction that such negligence proximately caused the harm suffered through the necessity of defending the Delaware action.” They filed this action on 11/12/24—well over six months after “they knew, or reasonably should have known, of the potential claim in” 5/21. Even if 5/22 “e-mail correspondence with defendants, which articulated more specific allegations of malpractice, were viewed as the triggering event for the six-month period,” the action was still untimely. Thus, their claim was barred under the six-month discovery rule. While they asserted that they had “to await a final judgment in the Delaware litigation before” filing their malpractice suit, the court noted that “Michigan law is clear that harm for purposes of accrual is established not by the finality of damages, but by the occurrence of an identifiable and appreciable loss.” Further, they did not “establish that defendants made any false representation or concealed material facts with the intent and knowledge necessary to invoke equitable estoppel.”