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Account Stated and Open Account Actions Involving Sale of Goods Subject to Michigan’s Six-Year Limitations Period

The Michigan Supreme Court recently held that account stated and open account actions are subject to the six-year limitations period provided by MCL 600.5807(8), even when the actions are based on a debt stemming from the sale of goods. In Fisher Sand & Gravel Co. v. Neal A Sweebe, Inc., Case No. 143374 (Mich. Sup. Ct. July 30, 2013), Fisher sought payment for concrete supplies it provided to Sweebe on account. Sweebe countered that the Michigan Uniform Commercial Code's four-year limitations period barred Fisher's claims. The trial and appeals courts agreed with Sweebe and dismissed Fisher's claims. The Michigan Supreme Court reversed, holding that the actions did not fall within the scope of the UCC. According to the court, the UCC's limitations period applies only to breach of contract claims involving the sale of goods. An action on an account stated is an action to enforce a subsequent promise to pay an account. Similarly, an open account claim "is an action to collect on the single liability stemming from the parties' credit relationship regardless of the underlying transactions comprising the account." Neither involves the sale of goods. Accordingly, the UCC's four-year period of limitations did not bar Fisher's claims.

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