Statute of Limitations and Tolling in Accounting Malpractice: NRS 11.2075 Interpreted

Introduction

In Tricarichi v. PricewaterhouseCoopers, LLP (Nos. 86317/87375/87835, May 29, 2025), the Supreme Court of Nevada addressed critical questions about the timeliness of accounting‐malpractice claims, the scope of tolling for concealed errors, the standards for relief under NRCP 60(b), and the award of fees under NRCP 68. Appellant Michael Tricarichi, assessed by the IRS for a $20 million tax deficiency arising from a 2003 corporate liquidation transaction, sued PwC in 2016 for negligent tax advice. After the district court granted summary judgment on 2003‐based claims, tried his 2008‐based claims, denied NRCP 60(b) relief, and awarded fees to PwC under NRCP 68, Tricarichi appealed each ruling. The Supreme Court affirmed in full.

Summary of the Judgment

The Supreme Court affirmed the district court’s orders in three respects:

Statute of Limitations (2003 Claims): Under NRS 11.2075(1)(b), a four‐year limitations period ran from the completion of PwC’s 2003 services and barred those claims. Alternatively, under NRS 11.2075(1)(a), inquiry notice triggered in February 2008 when the IRS sent an Information Document Request, and the two‐year period expired in February 2010.
NRCP 60(b) Relief: Tricarichi’s motion to set aside the final judgment based on newly discovered evidence (an internal email and risk‐management policy) failed because the evidence concerned a different transaction (Marshall) and would not have altered the statute‐of‐limitations analysis.
Fees under NRCP 68: The court applied the Beattie factors to two separate offers of judgment. The 2019 offer ($50,000) was rejected in good faith; the 2021 offer (also $50,000) was rejected unreasonably and entitled PwC to partial fees and costs. The district court properly used Brunzell principles to calculate a reasonable fee despite one firm billing at a flat fee.

Analysis

1. Precedents Cited

JSaranullo v. Ramos (136 Nev. 134, 2020): Standard of de novo review for summary judgment.
NRS 11.2075: Two-year discovery rule and four-year completion rule, plus tolling for concealment of the very error at issue.
Winn v. Sunrise Hosp. & Med. Ctr. (128 Nev. 246, 2012): Definition of “inquiry notice” when a prudent person is alerted to investigate further.
Ackerman v. Price Waterhouse (644 N.E.2d 1009, N.Y. 1994): Under New York law (alternative choice), a three-year limit accrues upon receipt of the accountant’s work product.
Coastal Transfer Co. v. Toyota Motor Sales, U.S.A. (833 F.2d 208, 9th Cir. 1987): Federal standard for NRCP 60(b)(2) newly discovered evidence requiring likely outcome change.
Cook v. Cook (112 Nev. 179, 1996): Abuse‐of‐discretion standard for NRCP 60(b) rulings.
Beattie v. Thomas (99 Nev. 579, 1983): Factors for awarding fees under offers of judgment (NRCP 68).
Brunzell v. Golden Gate Natl Bank (85 Nev. 345, 1969): Principles for calculating reasonable attorney fees.
O’Connell v. Wynn Las Vegas, LLC (134 Nev. 550, 2018), Logan v. Abe (131 Nev. 260, 2015), and Shuette v. Beazer Homes (121 Nev. 837, 2005): Standards for fee awards without precise billing records, emphasizing rational methods and detailed findings.

2. Legal Reasoning

Statute of Limitations: NRS 11.2075(1)(b) triggered at PwC’s last performance in October 2003, barring any claim after October 2007. Under NRS 11.2075(1)(a), inquiry notice arose in February 2008 when the IRS Information Document Request alerted Tricarichi to potential liability. A prudent person’s duty to investigate starts the two-year clock, which expired February 2010. Tricarichi’s injury‐accrual argument was rejected because the statute’s plain text requires neither a final IRS assessment nor an “accrued injury” to commence the period.

Tolling for Concealment: NRS 11.2075(2) tolls only if the accountant conceals the specific error that gives rise to the malpractice claim. The new email and policy pertained to a different client’s transaction (Marshall), not Tricarichi’s. Therefore, even if concealed, they would not toll the clock on Tricarichi’s 2003 or 2008 claims.

NRCP 60(b)(2): Tricarichi failed to show the newly discovered evidence would likely have changed the outcome. The district court reasonably concluded that dissimilar facts between the Marshall transaction and Tricarichi’s transaction precluded a different ruling.

NRCP 68 & Fees: Offers of judgment are evaluated under Beattie’s multi‐factor test. The 2019 offer was reasonable when made and rejected in good faith. By 2021, changed circumstances (rulings on summary judgment, evidentiary developments) rendered Tricarichi’s continued refusal unreasonable. Under Brunzell, the district court crafted a reasonable fee award despite flat‐fee billing, providing detailed analysis of hours, rates, and results.

3. Impact

This decision clarifies four key areas for accounting‐malpractice litigants in Nevada:

Trigger Dates: The shorter of two years from discovery/inquiry notice or four years from performance completion governs malpractice claims under NRS 11.2075.
Strict Tolling: Tolling applies only if the very error or omission at issue is concealed; unrelated or later‐revealed internal policies will not revive time‐barred claims.
NRCP 60(b) Evidence: District courts need only consider whether newly discovered evidence would have changed the result, not merely whether it is “incriminating.”
Offers of Judgment & Fees: Beattie and Brunzell continue to offer flexible frameworks. Subsequent offers must take into account intervening rulings and evidence; fee awards may rely on rational, documented approximations when precise billing records do not exist.

Complex Concepts Simplified

Inquiry Notice: When a party receives information that would prompt a reasonable person to investigate possible wrongdoing.
Tolling: Pausing the running of a limitations period if the defendant hides the very mistake at issue.
NRCP 60(b): Rule allowing relief from a final judgment for reasons such as newly discovered evidence or fraud, reviewed for abuse of discretion.
NRCP 68 Offer of Judgment: A formal settlement proposal; rejecting an unreasonable one can expose a party to paying the other side’s fees and costs incurred after the offer.
Beattie Factors: A multifactor test (e.g., fairness, timing, result) to decide whether fee‐shifting is appropriate when an offer of judgment is rejected.
Brunzell Factors: Considerations (e.g., time spent, nature of work, results obtained) to determine a reasonable attorney fee award.

Conclusion

Tricarichi v. PwC establishes that Nevada’s accounting‐malpractice statute of limitations runs from service completion or inquiry notice—not injury accrual. Tolling for concealment is narrowly confined to the specific error at issue. Relief under NRCP 60(b) demands a showing of likely outcome change, and fees under NRCP 68 require careful Beattie/Brunzell analyses. This ruling reinforces the duty of malpractice plaintiffs to act promptly upon inquiry triggers and clarifies the limited scope of tolling and post-judgment relief. It will guide future malpractice suits, trial court discovery orders, and settlement strategies in Nevada and potentially beyond.