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Jim Brown Chevrolet3/23/2001
JUDGMENT: Affirmed.
This is an appeal from the Lake County Court of Common Pleas. Appellants, Jim Brown Chevrolet, Inc., d.b.a. Classic Chevrolet, Classic Oldsmobile, Inc., d.b.a. Classic Oldsmobile, and Jim Brown, Inc., d.b.a. Classic Cadillac, appeal the trial court's judgment entry dated February 2, 2000.
On July 28, 1999, appellants filed a complaint against appellees, S.R. Snodgrass, A.C. ("Snodgrass") and Robert L. Lewis, Jr. ("Lewis"), alleging accounting negligence. Appellee Snodgrass is an accounting firm, and appellee Lewis is an accountant employed by the firm. Appellees filed an answer to the complaint on September 16, 1999. Thereafter, on December 3, 1999, appellees moved for summary judgment on the grounds that appellants' claims were barred by the four-year statute of limitations contained in R.C. 2305.09. Appellants submitted their brief in opposition to the motion on January 25, 2000.
The record revealed that appellees began providing accounting services to appellants from 1979 through March 1998. Appellants elected the LIFO (last in first out) inventory method for tax purposes. In 1997, the Internal Revenue Service ("IRS") issued a revenue ruling and a revenue procedure between itself and the National Automobile Dealers Association ("NADA"). The IRS provided terms and conditions by which car dealerships, that had violated the LIFO reporting requirements from 1991 to 1996, could pay a penalty in lieu of having their LIFO election terminated. Specifically, a car dealer was permitted to perform a self-audit and, if a violation was found, the dealership could pay a penalty of 4.7 percent of the total LIFO tax deferral.
Pursuant to the settlement, appellants conducted self-audits in May 1998. During the audits, appellants discovered that they had violated this consistency requirement and owed the IRS substantial penalties. Appellants found that these violations had occurred in 1991 and 1992. Subsequently, appellants terminated their relationship with appellees in 1998. They filed a complaint claiming that appellees failed to advise them that LIFO inventory valuations were required in their annual financial reports to the company that was providing them with financing, and as a result, they incurred considerable penalties. Appellants sought to recover the monies from appellees on a claim of accounting negligence.
On February 2, 2000, the trial court granted appellees' motion for summary judgment because appellants' "complaint was filed on July 28, 1999 more than four years after the occurrence of the most recent of the alleged negligent acts (1992). As such, [appellants'] claims are barred by the four year statute of limitations in R.C. 2305.09(D)." Appellants timely filed the instant appeal and now assert the following as error:
"The trial court erred as a matter of law in ruling appellants' cause of action arose in 1991 and 1992, when appellants did not sustain monetary damages until 1997."
In their lone assignment of error, appellants challenge the trial court's decision to grant summary judgment in appellees' favor on the basis that the statute of limitations on their claim had expired. Specifically, appellants claim that the trial court erred in determining when a cause of action accrues for accountant negligence.
Summary judgment is appropriate only when it has been established: (1) that there is no genuine issue as to any material fact; (2) that the moving party is entitled to judgment as a matter of law; and (3) that reasonable minds can come to only one conclusion, and that conclusion is adverse to the nonmoving party. Civ.R. 56(C).
Appellate courts review a trial
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