Accountant (or other professional) is retained to provide professional services.  On Day X the business to which the professional services are rendered “closes.”  On Day x+10 the professional returns all the papers, does the final report and “resigns.”  On which day does the three-year statute of limitations commence?

Weight v Day   2015 NY Slip Op 09093   Decided on December 9, 2015  Appellate Division,  Second Department tells us that it is not until the paperwork is complete and returned that the statute commences.

“For a number of years, the plaintiff jointly owned and operated a business known as Weight Steel Construction, Inc. (hereinafter Weight Steel), with her husband, nonparty Joseph Weight. On or about September 30, 2009, while the plaintiff and her husband were engaged in divorce proceedings, they hired the defendant Wayne Day, a certified public accountant and a partner at the defendant accounting firm, Day Seckler, LLP, to serve as trustee of Weight Steel until the divorce was final. Accordingly, Day entered into an agreement with the plaintiff and her husband, as the sole shareholders of Weight Steel, which provided, in pertinent part, that Day would “assume sole responsibility for receiving and disbursing the income” of Weight Steel, deliver copies of all such records to the plaintiff and her husband on a weekly basis, and continue acting as trustee until termination by a signed written agreement or court order. Day tendered his resignation as Weight Steel’s trustee in a letter dated February 10, 2011.

On February 10, 2014, exactly three years after Day sent his resignation letter, the plaintiff commenced this action against the defendants, alleging, inter alia, accounting malpractice, breach of fiduciary duty, fraud, and breach of contract. The plaintiff alleged, among other things, that Day failed to properly manage Weight Steel, prevent her husband from needlessly using the company’s assets for his personal gain, deposit the company’s payments, and bill its customers. The plaintiff further alleged that Day irresponsibly ran up the company’s debt, intentionally concealed its dire financial situation, and denied her access to its records and facilities. The complaint included an allegation that Weight Steel “closed” on or about August 23, 2010.

Thereafter, the defendants moved pursuant to CPLR 3211(a)(5) and (7) to dismiss the complaint. Among other things, they argued that the complaint was time-barred because it did not allege any errors, acts, or omissions that occurred after August 23, 2010, the date that Weight Steel allegedly closed. In addition, the defendants argued that all of the causes of action other than that alleging accounting malpractice should be dismissed as duplicative of the accounting malpractice cause of action. The Supreme Court granted the defendants’ motion to dismiss the complaint, concluding that the causes of action alleging accounting malpractice and breach of fiduciary duty were time-barred, and further concluding, in effect, that the remaining causes of action should be dismissed for failure to state a cause of action. The plaintiff appeals, and we modify.

“Contrary to the court’s determination, the defendants failed to establish that these causes of action accrued on August 23, 2010, when Weight Steel allegedly “closed.” It is undisputed that Day did not resign as trustee of Weight Steel until February 10, 2011. Further, the defendants did not establish when they delivered to the plaintiff all the pertinent documents related to their accounting work and Day’s additional duties as trustee. Based upon the defendants’ submissions, including the complaint and the agreement outlining the terms of the trusteeship, the earliest possible accrual date with respect to the claims of accounting malpractice and breach of fiduciary duty was February 10, 2011, exactly three years prior to the commencement of this action (see IDT Corp. v Morgan Stanley Dean Witter & Co., 12 NY3d at 139; McCoy v Feinman, 99 NY2d 295, 301; Ackerman v Price Waterhouse, 84 NY2d 535, 541). Thus, the defendants failed to meet their initial burden of demonstrating that those causes of action were time-barred. Accordingly, the court should have denied that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(5) to dismiss those causes of action. Moreover, contrary to the defendants’ contention, dismissal of the cause of action alleging breach of fiduciary duty is not warranted on the ground that it is duplicative of the cause of action alleging accounting malpractice (cf. Staffenberg v Fairfield Pagma Assoc., L.P., 95 AD3d 873, 874).”