Rogers anderson malody and scott5/5/2023 ![]() ![]() By March of 1987, plaintiffs had hired a new accountant and an attorney, and had paid to them fees for services involving resolution of their tax problems related to the tax straddle partnership deductions. ![]() At a meeting with Jack Scott a few weeks after their relationship with defendants had been terminated, plaintiffs told him they believed he had given them negligent advice. In January 1987, plaintiffs terminated defendants as plaintiffs' accountants, because of their conclusion that they had been given negligent advice. On December 16, 1986, plaintiffs paid the IRS and the FTB a total of over $240,000 in back taxes and interest related to the disallowance of tax straddle partnership losses which plaintiffs had previously deducted on their income tax returns. In 1986, plaintiffs concluded that defendants had been negligent in advising them that they could reduce their tax liability by such investments. In 1982, plaintiffs became aware that the IRS was disallowing such loss deductions. In reliance on this advice, plaintiffs invested in three such tax straddle partnerships between 19, and claimed losses related to these investments on their income tax returns. The following facts were agreed to be undisputed by the parties in connection with defendants' motion for summary judgment.Ä«etween 19, defendants advised plaintiffs that investment in certain tax shelters known as "tax straddle partnerships" would reduce their income tax liability. They filed their first amended complaint for breach of contract, negligence, breach of fiduciary duty, and negligent misrepresentation on January 12, 1990. Plaintiffs filed their complaint for breach of contract, fraud, and intentional and negligent misrepresentation against defendants on October 23, 1989. Plaintiffs contended below, and contend on appeal, that the commencement of the statute of limitations for professional malpractice was tolled while they pursued their administrative remedies challenging adverse tax assessments by the Internal Revenue Service (IRS) and California Franchise Tax Board (FTB), and that therefore their action is not barred by the statute of limitations. Plaintiffs had sued defendants for accountant malpractice, and the judgment was entered following defendants' successful motion for summary judgment, based on the theory that plaintiffs' action for malpractice was barred by the statute of limitations. Malody II, a professional corporation, and Rogers, Anderson, Malody and Scott (defendants). Rogers, a professional corporation, Richard D. Scott, a professional corporation, Donald L. Schrader (plaintiffs) appeal from the judgment entered in favor of defendants Jack C. ![]() (Opinion by Timlin, J., with Dabney, Acting P. (Superior Court of San Bernardino County, No. SCOTT et al., Defendants and Respondents. SCHRADER et al., Plaintiffs and Appellants, v. ![]()
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