Dr. Robert F. Colwell, Jr., D.D.S., and Dr. Robert F. COLWELL, DDS, PC, APPELLANTS,
SEAN MULLEN, J.D., and Hancock & Dana, PC, appellees.
Limitations of Actions: Appeal and Error.
The point at which a statute of limitations begins to run
must be determined from the facts of each case, and the
decision of the district court on the issue of the statute of
limitations normally will not be set aside by an appellate
court unless clearly wrong.
Summary Judgment. Summary judgment is proper
when the pleadings and evidence admitted at the hearing
disclose no genuine issue regarding any material fact or the
ultimate inferences that may be drawn from those facts and
that the moving party is entitled to judgment as a matter of
Summary Judgment: Appeal and Error. In
reviewing a summary judgment, an appellate court views the
evidence in the light most favorable to the party against
whom the judgment is granted and gives such party the benefit
of all reasonable inferences deducible from the evidence.
Limitations of Actions: Negligence. The
period of limitations begins to run upon the violation of a
legal right, that is, when an aggrieved party has the right
to institute and maintain suit. If a claim for professional
negligence is not to be considered time barred, the plaintiff
must either file within 2 years of the alleged act or
omission or show that its action falls within an exception to
Neb. Rev. Stat. § 25-222 (Reissue 2016).
Limitations of Actions. The 1-year discovery
exception of Neb. Rev. Stat. § 25-222 (Reissue 2016) is
a tolling provision, but it applies only in those cases in
which the plaintiff did not discover and could not have
reasonably discovered the existence of the cause of action
within the applicable statute of limitations.
Limitations of Actions: Malpractice. In
order for a continuous relationship to toll the statute of
limitations regarding a claim for malpractice, there must be
a continuity of the relationship and services for the [301
Neb. 409] same or related subject matter after the alleged
professional negligence. Continuity does not mean the mere
continuity of the general professional relationship.
__:__. Even where a continuous relationship exists, the
continuous relationship rule is inapplicable when the
claimant discovers the alleged negligence prior to the
termination of the professional relationship.
Limitations of Actions: Torts. It is well
accepted that when an individual is subject to a continuing,
cumulative pattern of tortious conduct, capable of being
terminated and involving continuing or repeated injury, the
statute of limitations does not run until the date of the
last injury or cessation of the wrongful action.
__ . The continuing tort doctrine requires that a tortious
act- not simply the continuing ill effects of prior tortious
acts-fall within the limitation period.
Appeal and Error. Claims not presented to or
decided by the district court need not be addressed on
from the District Court for Douglas County: Peter C.
Bataillon, Judge. Affirmed.
A. Svoboda and Adam J. Wachal, of Gross & Welch. PC,
L.L.O., for appellants.
William F. Hargens and Lauren R. Goodman, of McGrath. North,
Mullin & Kratz, P.C., L.L.O., for appellees.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, and
Robert F. Colwell, Jr., D.D.S., and his self-named
professional corporation (collectively Colwell), filed suit
alleging malpractice against Sean Mullen and against Hancock
& Dana, P.C. (collectively Mullen). Sean Mullen is an
attorney licensed to practice law and works as a tax attorney
at Hancock & Dana, an accounting firm. The district court
granted Mullen's motion for summary judgment, concluding
that Colwell's malpractice claims were barred by the
statute of limitations set forth in Neb. Rev. Stat. §
25-222 (Reissue 2016). We affirm.
Neb. 410] FACTUAL BACKGROUND
Colwell was a dentist practicing primarily in Douglas County,
Nebraska. In 2004, he agreed to purchase 50 percent of a
dental practice currently being operated by Jeffrey Garvey.
The purchase agreement envisioned that Dr. Colwell and Garvey
would form separate professional corporations in their
respective names and that those professional corporations
would each own half of the practice. The practice would be
operated as Midlands Oral Health, LLC (Midlands).
hired Mullen to assist him in forming his professional
corporation. Mullen had apparently worked for Garvey in the
past and was again retained by Garvey to form Garvey's
professional corporation. In addition, Mullen was retained by
Dr. Colwell's professional corporation, Garvey's
professional corporation, and Midlands as an accountant and
was formed as a going concern complete with various assets,
including dental and office equipment and employees. In 2005,
Midlands transferred control of its employees to a new
corporation, Grobell, P.C. Grobell was owned by Garvey;
apparently, Mullen assisted Garvey in the creation of Grobell
and the transfer of the employees. Employees from a different
dental practice that had been purchased by Midlands in 2004
were also transferred to Grobell. All employees were then
leased by Grobell to Midlands, apparently at an 18-percent
leasing fee. Colwell claims that this was all done without
his knowledge and that he was damaged because as a 50-percent
owner of Midlands, he had to pay half of the lease fee.
Colwell alleges that he learned of the transfer of employees
in mid-March 2011 and of the leaseback fee in August 2011.
addition, with Mullen's assistance, Garvey also formed
Vanguard Dental Solutions, Inc. (Vanguard). Vanguard was a
service which charged a membership fee to participate, with
members receiving a discount on dental services from
participating care providers. Midlands was a participating
provider with Vanguard, and Vanguard members paid less for
dental services at Midlands. Colwell denies that he was ever
informed [301 Neb. 411] of Garvey's interest in Vanguard
or of Mullen's assistance in the formation of Vanguard.
It is not clear from the record when Vanguard was created;
Colwell apparently learned of its creation in August 2011.
October 2010, Colwell formed RMR Enterprises, L.L.C. (RMR),
for the purpose of constructing a new office building for
Midlands. RMR expended over $100, 000 to buy land and pay
fees associated with the purchase. In February 2011, Mullen
reviewed certain provisions of an operating agreement for RMR
and billed Colwell for those services.
April 2011, Colwell terminated his professional relationship
with Mullen. He later engaged counsel to file suit against
Garvey. Colwell and Garvey eventually settled in December
2011. This current action for professional malpractice was
filed on March 4, 2013. As amended, Colwell's complaint
alleged six acts of legal and accounting malpractice: that
Mullen (1) failed to advise Colwell of Mullen's conflict
of interest; (2) transferred Midlands employees to Grobell
without Colwell's knowledge; (3) caused Colwell to pay 50
percent of an 18-percent administrative leaseback fee for the
Grobell employees; (4) prepared and filed an erroneous
Schedule K-1 (K-1) for 2010 (alleged as legal malpractice)
and for 2011 (alleged as both ...