One aspect of the professional – client relationship is the repetitive, year over year nature in which events keep recurring, and the work keeps being performed.  Helzen Assoc. LLC v Katz  2020 NY Slip Op 33508(U)
October 22, 2020 Supreme Court, New York County  Docket Number: 655561/2019 Judge: Carol R. Edmead is a case in which client pays a specific tax year after year only to find out that no tax need have been paid.  How far back can the accountants be liable?

“Plaintiff alleges that defendants erroneously advised plaintiff that it was liable for NewYork City unincorporated business tax (UBI), and plaintiff paid that tax in reliance upon defendants’ advice, as reflected in the returns prepared by defendants, starting with Helzen’ s incorporation in 2002. Plaintiff received refunds for the amounts of UBI tax paid for the years 2015 -2017, after the New York City Department of Finance (DOF) informed defendants that the UBI tax was not owed, and defendants filed Form 452, amending the returns for those three years. ”

“Defendant’s advice to Katz to write a letter in furtherance of plaintiff’s claims for refunds for the Prior Years constitutes advice on how to proceed and is some evidence of continuing representation with respect to the Prior Years.

While each annual tax return involves a separate contractual engagement, defendants have not presented sufficient evidence to demonstrate that they did not engage in any corrective or remedial services in connection with the overpayments in the Prior Years (see Lemle v Regen, Benz & MacKenzie, C.P.A ‘s, P.C., 165 AD3d 414, 415 [1st Dept 2018]). The statute of limitations is tolled under the continuous representation doctrine only for “so long as the defendant continues to advise the client in connection with the particular transaction which is the subject of the action and not merely during the continuation of a general professional relationship” (Booth v Kriegel, 36 AD3d at 314).

Plaintiff is entitled to discovery on the underlying issues, including whether defendants made any application for refunds or performed continuing services with respect to the Prior Years. “