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Walters v. Ratajczyk

United States District Court, Western District of Michigan, Southern Division

February 20, 2015

LETA WALTERS, Plaintiff,



This case arises from a car accident that occurred in Tennessee on January 18, 2013. Plaintiff, Leta Walters, was a resident of Idaho at the time of the accident, and Defendants, Miroslaw Ratajczyk and Open Road Truck & Trailer Leasing, LLC (Open Road), were residents of Michigan. The parties agree that under Michigan’s borrowing statute, Tennessee’s one-year statute of limitations applies to this action. Defendants have moved to dismiss the action as time-barred because it was filed outside that one-year period. Walters argues that Defendants are estopped from asserting a statute of limitations defense because their insurance company engaged in negotiations with Walters. For the following reasons, the Court concludes that the action is time-barred.


On January 18, 2013, while driving a truck owned by Open Road, Ratajczyk hit the vehicle in which Walters was a passenger. Shortly thereafter, Walters hired a Utah attorney, Jonathan Nash, to represent her. (Dkt. #7-2 at Page ID#43.) From that point until November 2014, Nash engaged in communications with Defendants’ insurer. (Id. at Page ID##43-44, 54.) Nash communicated with claims adjustor Thomas Still until July 2013, when the file was reassigned to claims adjustor Tammy Lambas. (Id. at Page ID##43-44, 54; Dkt. #8-2 at Page ID#72.)

On August 5, 2013, Lambas sent Nash a letter requesting Walters’s medical information. (Dkt. #8-2 at Page ID#72.) Lambas did not receive a response, and resent the letter on October 11, 2013. (Id.) Lambas received a confirmation that the letter had been received, but no other response. (Id.) After that, Lambas had no contact with Nash until February 2014-after the one-year anniversary of the accident. (Id.)

On February 13, 2014, Lambas called Nash’s assistant to inquire when Walters would make a demand. (Id.) On February 20, 2014, Lambas sent Nash an email requesting a copy of the summons and complaint that she “assume[d] were filed per the one year TN statute of limitations.” (Dkt. #7-2 at Page ID#47.) Nash responded that, due to “the ongoing and future treatment needs of Ms. Walters as well as the significant monetary amount of her damages, ” Walters intended to file an action in Michigan, “which has a three (3) year statute of limitations for personal injury cases.” (Id. at Page ID#48.) Lambas responded that she never assumed that a lawsuit had been filed, that she was aware that Walters had choices for venue, and that she had discussed the matter with Michigan counsel. (Id.) She further stated that she would await Walters’s demand materials. (Id.)

On April 3, 2014, Nash sent Lambas a demand letter seeking a $1 million settlement. (Dkt. #8-2 at Page ID#72.) Lambas subsequently told Nash that she did not have sufficient information to offer a settlement, pointing out that she had received no documentation to support Walters’s claim for loss of earnings capacity. (Id. at Page ID ##72-73; Dkt. #7-2 at Page ID#49-51.) Lambas also mentioned that she was “not convinced of [Nash’s] choice of law or venue.” (Dkt. #7-2 at Page ID#49.)

On September 23, 2014, Lambas extended to Nash an offer of $75, 000 to settle Walters’s claim. (Dkt. #8-2 at Page ID#72.) On October 8, 2014, Walters filed a complaint in the instant action. (Dkt. #1.) On November 10, 2014, Nash inquired about the offer, and Lambas responded that Walters rejected the offer by filing the instant suit. (Dkt. #7-2 at Page ID#54.)


Defendants argue that Walters’s claim is governed by Tennessee’s one-year statute of limitations, and that it is therefore time-barred. Walters does not dispute that the action is governed by the one-year statute of limitations, but argues that Defendants are estopped from asserting a defense based on the statue of limitations because they engaged in continuous negotiations with Walters before and after the one-year period had run. Walters contends that the negotiations included representations concerning whether Michigan’s or Tennessee’s statute of limitations applied, and that Defendants induced Walters into believing that they would work toward a settlement even after one year had passed.

Michigan recognizes the doctrine of equitable estoppel as an exception to the general rule that statutes of limitation run uninterrupted. Cincinnati Ins. Co. v. Citizens Ins. Co., 454 Mich. 263, 270, 562 N.W.2d 648, 651 (1997) (per curiam). The doctrine is essentially one of waiver that precludes a defendant from raising a statute of limitations defense. Id. As the Michigan Supreme Court explained:

One who seeks to invoke the doctrine generally must establish that there has been (1) a false representation or concealment of a material fact; (2) an expectation that the other party will rely on the misconduct; and (3) knowledge of the actual facts on the part of the representing or concealing party. This Court has been reluctant to recognize an estoppel absent intentional or negligent conduct designed to induce a plaintiff to refrain from bringing a timely action. Negotiations intended to forestall bringing an action have been considered an inducement sufficient to invoke the doctrine, however.

Id. (internal citations omitted).

The estoppel doctrine was applied to negotiations by the Michigan Supreme Court in Friedberg v. Insurance Company of North America, 257 Mich. 291, 241 N.W. 183 (1932). In that case, the defendant engaged in negotiations until shortly before the limitations period had expired. Id. at 293, 241 N.W. at 184. The court explained that the negotiations were “clearly of a character to induce the plaintiff to abstain from suit, ” and thus operated as a waiver of the statute of limitations defense. Id. As the Michigan Court of Appeals has explained, Friedberg stands for the proposition that “[i]f an insurer, through negotiations or dilatory tactics, induced an insured to forego bringing suit under an insurance policy until after its limitations ...

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