TOLLING UNDER MCL 500.5856 DOES NOT APPLY WITHOUT A PRIOR ADJUDICATION ON THE MERITS DURING THE PENDENCY OF AN APPEAL

In Markabani v Al-Rekabi, (Docket No. 324047, issued February 9, 2016), the Michigan Court of Appeals reversed the trial court’s ruling that the statute of limitations for a third-party automobile negligence claim was tolled due to an ongoing appeal.

The date of loss was May 11, 2009.  The statute of limitation that governs a third-party automobile negligence claim is MCL 600.5805(10).  In relevant part, MCL 500.5805(10) states “the period of limitations is 3 years after the time of death or injury for all actions to recover damages for the death of a person, or the injury to a person or property.” There was no dispute that Plaintiff filed the action after the statute of limitations had expired and the Circuit Court granted summary disposition in favor of defendant based upon the running of the 3 year statute of limitations.

On appeal, Plaintiff argued the Circuit Court erred in applying MCL 500.5805(10) and that Plaintiff’s cause of action is saved by MCL 600.5856 which provides the statutory period was tolled during the pendency of his prior lawsuits and prior appeal to the Court of Appeals.  The Court of Appeals noted there was no dispute MCL 600.58085(10) governed Plaintiff’s automobile negligence claim, and no dispute the applicable limitations period would have expired, despite tolling of the action, during Plaintiff’s prior lawsuits in the Circuit Court.  The question before the Court of Appeals was whether MCL 600.5856 tolled the relevant statutory limitations period while plaintiff’s prior appeal in this matter was pending.

Pursuant to MCL 500.5856, statute of limitations are tolled in two scenarios: (1) when the complaint is filed, if a copy of the summons and complaint are served on the defendant within the time set forth in the Supreme Court rules; or (2) at the time jurisdiction over the defendant is otherwise acquired.  The Michigan Supreme Court has held that MCL 600.5856 comes into play where a party files suit beyond the limitation period and seeks to toll the time that elapsed during a previously dismissed lawsuit against the same defendant from the date of service, acquisition of jurisdiction, or placement of process with an officer for delivery until a dismissal that is not based on the merits of the action.  Terrace Land Dev Corp v Seeligson & Jordan, 250 Mich App 452, 459; 647 NW2d 524 (2002).  Prior lawsuits between parties will toll the running of the period of limitation where the prior lawsuit involves the same cause of action. Great Lakes Gas Transmission Co v State Treasurer, 140 Mich App 635, 649; 364 NW2d 773 (1985).

The Michigan Supreme Court has also indicated that a limitation period is tolled while an appeal is pending pursuant to a claim of appeal.  Riza v Niagara Machine & Tool Works, Inc, 411 Mich 915; __ NW2d __ (1981).  Specifically, in Darin v Haven, 175 Mich App 144; 437 NW2d 349 (1989), the Court of Appeals found that an action being appealed is considered “pending” for purposes of MCR 2.116(C)(6).  More recently, in Yeo v State Farm & Casualty Ins Co, 242 Mich App 483; 618 NW2d 916 (2000), the Court of Appeals found the statute of limitation in that case was not tolled during the earlier appeal because the narrow issue raised in that appeal was whether the dismissal of plaintiff’s claim on the basis of her failure to comply with a condition precedent to filing a lawsuit should have been with prejudice.

Thus, the Markabani Court determined that where a dismissal of a prior lawsuit is with prejudice, and so is considered an adjudication on the merits, the tolling provisions of MCL 600.5856 would not apply.  In Markabani, however, where Plaintiff’s prior lawsuits and appeal were dismissed without prejudice, and did not compromise adjudications on the merits, the tolling provisions of MCL 600.5856 are applicable.

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