Articles Posted in Michigan Supreme Court

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Daniel Kemp sued his no-fault insurer, Farm Bureau General Insurance Company of Michigan, seeking personal protection insurance (PIP) benefits under the parked motor vehicle exception in MCL 500.3106(1)(b) for an injury he sustained while unloading personal items from his parked motor vehicle. Farm Bureau moved for summary disposition under MCL 2.116(C)(10) on the basis that Kemp had not established any genuine issue of material fact regarding whether he satisfied MCL 500.3106. Kemp responded by asking the trial court to deny Farm Bureau’s motion and, instead, to grant judgment to Kemp under MCR 2.116(I)(2). The trial court granted Farm Bureau's motion for summary judgment. The Michigan Supreme Court reversed, finding that Kemp satisfied the transportational function required as a matter of law, and created a genuine issue of material fact concerning whether he satisfied the parked vehicle exception in MCL 500.3106(1)(b) and the corresponding causation requirement. Therefore, the trial court erred in granting summary judgment, and the Court of Appeals erred in affirming the trial court. The matter was remanded for further proceedings. View "Kemp v. Farm Bureau Gen. Ins. Co. of Michigan" on Justia Law

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Only two sections of the Michigan no-fault act mention healthcare providers, MCL 500.3157 and MCL 500.3158, and neither of those sections confers on a healthcare provider a right to sue for reimbursement of the costs of providing medical care to an injured person. Although MCL 500.3112 allows no-fault insurers to directly pay PIP benefits to a healthcare provider for expenses incurred by an insured, MCL 500.3112 does not entitle a healthcare provider to bring a direct action against an insurer for payment of PIP benefits. Covenant Medical Center, Inc., brought suit against State Farm Mutual Automobile Insurance Company to recover payment under the no-fault act for medical services provided to State Farm’s insured, Jack Stockford, following an automobile accident in which Stockford was injured. State Farm denied payment. In the meantime, Stockford had filed suit against State Farm for no-fault benefits, including personal protection insurance (PIP) benefits. Without Covenant’s knowledge, Stockford and State Farm settled Stockford’s claim for $59,000 shortly before Covenant initiated its action against State Farm. As part of the settlement, Stockford released State Farm from liability for all allowable no-fault expenses and any claims accrued through January 10, 2013. State Farm moved for summary judgment under MCR 2.116(C)(7) (dismissal due to release) and MCR 2.116(C)(8) (failure to state a claim). The trial court granted State Farm’s motion under MCR 2.116(C)(7), explaining that Covenant’s claim was dependent on State Farm’s obligation to pay no-fault benefits to Stockford, an obligation that was extinguished by the settlement between Stockford and State Farm. View "Covenant Medical Center, Inc. v. State Farm Mutual Automobile Ins. Co." on Justia Law

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In 2004, George and Thelma Nickola, were injured in a car accident. The driver of the other car was insured with a no-fault insurance policy provided the minimum liability coverage allowed by law: $20,000 per person, up to $40,000 per accident. The Nickolas’ (acting through their attorney) wrote to their insurer, defendant MIC General Insurance Company, explaining that the no-fault liability insurance policy was insufficient to cover the Nickolas' injuries. The letter also advised MIC that the Nickolas were claiming UIM benefits under their automobile policy. The Nickolas’ policy provided for UIM limits of $100,000 per person, up to $300,000 per accident, and they sought payment of UIM benefits in the amount of $160,000; $80,000 for each insured. An adjuster for defendant MIC denied the claim, asserting that the Nickolas could not establish a threshold injury for noneconomic tort recovery. The matter was ultimately ordered to arbitration, the outcome of which resulted in an award of $80,000 for George’s injuries and $33,000 for Thelma’s. The award specified that the amounts were “inclusive of interest, if any, as an element of damage from the date of injury to the date of suit, but not inclusive of other interest, fees or costs that may otherwise be allowable.” The trial court affirmed the arbitration awards but declined to award penalty interest under the UTPA, finding that penalty interest did not apply because the UIM claim was “reasonably in dispute” for purposes of MCL 500.2006(4). The Court of Appeals affirmed the trial court, holding that the “reasonably in dispute” language applied to plaintiff’s UIM claim because a UIM claim “essentially” places the insured in the shoes of a third-party claimant. The Michigan Supreme Court held that an insured making a claim under his or her own insurance policy for UIM benefits cannot be considered a “third party tort claimant” under MCL 500.2006(4). The Court reversed the Court of Appeals denying plaintiff penalty interest under the UTPA, and remanded this case back to the trial court for further proceedings. View "Estate of Nickola v MIC General Ins. Co." on Justia Law

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In 2009, plaintiff Dragen Perkovic was operating a semitruck in Nebraska when he swerved to avoid hitting a car that had spun out in front of him. Plaintiff’s truck then crashed into a wall. Plaintiff’s resulting injuries were treated at The Nebraska Medical Center. At the time of the accident, plaintiff maintained personal automobile insurance with Citizens Insurance Company of the Midwest (Citizens) and a bobtail insurance policy with Hudson Insurance Company (Hudson). Plaintiff’s employer was insured by defendant Zurich American Insurance Company. The issue this case presented for the Supreme Court's review centered on the notice requirements of the no-fault act, specifically those set forth in MCL 500.3145(1): whether a nonparty medical provider’s provision of medical records and associated bills to an injured person’s no-fault insurer within one year of the accident causing injury constitutes proper written notice under MCL 500.3145(1), so as to prevent the one-year statute of limitations in MCL 500.3145(1) from barring the injured person’s subsequent no-fault claim. The Michigan Supreme Court held that when, as in this case, the documentation provided by the medical provider contained all of the information required by MCL 500.3145(1) and was provided to the insurer within one year of the accident, the statutory notice requirement was satisfied and the injured person’s claim was not barred by the statute of limitations. Therefore, the Court reversed the judgment of the Court of Appeals, vacated the trial court’s order granting summary disposition in favor of defendant Zurich American Insurance Company, and remanded to the trial court for further proceedings. View "Perkovic v. Zurich American Ins. Co." on Justia Law

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The issue presented in this case was whether, by signing a contract providing that plaintiff agreed “to reimburse [defendants’] attorney fees and costs as may be fixed by the court,” the parties agreed that the amount of reasonable attorney fees would be fixed by a court rather than a jury. After review, the Supreme Court held that the parties did so agree. Accordingly, the Court vacated part of the Court of Appeals’ opinion and reversed that portion of the judgment that reversed the award of contractual attorney fees and costs, as well as that portion of the judgment that reversed the award of case evaluation sanctions. The Court otherwise denied the application and cross-application for leave to appeal and left in place the remainder of the Court of Appeals’ opinion. View "Barton-Spencer v. Farm Bureau Life Ins. Co. of Michigan" on Justia Law

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Linda Hodge filed suit against State Farm Mutual Automobile Insurance Company for first-party no-fault benefits related to injuries she sustained when she was struck by a car insured by State Farm. Hodge’s complaint indicated that the amount in controversy was $25,000, which was within the district court’s jurisdiction. During discovery, State Farm came to believe that Hodge would present at trial proof of damages in excess of the district court’s $25,000 jurisdictional limit. The trial court denied State Farm’s motion in limine to prevent Hodge from presenting evidence of claims exceeding $25,000, and to prevent the jury from awarding damages in excess of $25,000. At trial, Hodge did present proof of injuries exceeding $25,000, and the jury returned a verdict of $85,957. The district court reduced the verdict to the jurisdictional limit of $25,000, and it awarded $1,769 in no-fault interest. State Farm appealed, claiming that the amount in controversy exceeded the district court’s jurisdictional limit and that capping Hodge’s damages at $25,000 could not cure the defect. The circuit court agreed and reversed the district court’s order of judgment. The Court of Appeals affirmed the circuit court’s decision that the district court was divested of jurisdiction when pretrial discovery, counsel’s arguments, and the evidence presented at trial pointed to damages in excess of $25,000. The Supreme Court held "what the jurisprudence of this state has long established:" in its subject-matter jurisdiction inquiry, a district court determines the amount in controversy using the prayer for relief set forth in the plaintiff’s pleadings, calculated exclusive of fees, costs, and interest. Hodge’s complaint prayed for money damages “not in excess of $25,000,” the jurisdictional limit of the district court. Even though her proofs exceeded that amount, the prayer for relief controlled when determining the amount in controversy, and the limit of awardable damages. Because there were no allegations, and therefore no findings, of bad faith in the pleadings, the district court had subject-matter jurisdiction over the plaintiff’s claim. View "Hodge v. State Farm Mutual Automobile Ins. Co." on Justia Law

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In 2008, Feridon Pirgu sustained closed head injuries after he was struck by a car driven by an insured of defendant, United Services Automobile Association. Plaintiff, Feridon’s wife Lindita, was appointed as his guardian and conservator. Shortly thereafter, plaintiff sought various personal protection insurance (PIP) benefits for Feridon. Because Feridon was uninsured, the claim was initially assigned to the Michigan Assigned Claims Facility, which then assigned the claim to Citizens Insurance Company. Following a priority dispute between Citizens and defendant, defendant was determined to have first priority for payment of PIP benefits. Defendant began adjusting the claim in 2010, and immediately discontinued payment of the benefits. The issue this case presented for the Michigan Supreme Court's was whether the framework for calculating a reasonable attorney fee set forth in "Smith v Khouri" applied to attorney fee determinations under MCL 500.3148(1) of the no-fault insurance act. The Court of Appeals’ majority affirmed the trial court’s calculation of the attorney fee award, concluding that the Smith framework did not apply to attorney fee determinations under section 3148(1). The Supreme Court disagreed with this conclusion and instead held that the Smith framework applied to attorney fee determinations under section 3148(1). Therefore, in lieu of granting leave to appeal, the Court reversed the judgment of the Court of Appeals, vacated the fee award, and remanded to the trial court for reconsideration of its attorney fee award. View "Pirgu v. Unived Services Automobile Ass'n." on Justia Law

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Alan Jesperson was injured in a motor vehicle accident when his motorcycle was struck from behind by a vehicle owned by Mary Basha and driven by Matthew Badelalla while Badelalla was making deliveries for Jet’s Pizza. Auto Club Insurance Association (ACIA) was notified of Jesperson’s injuries and that it was the highest-priority no-fault insurer. It began making payments to Jesperson shortly after it received that notice. Jesperson brought an action against Basha, Badelalla, and Jet’s seeking damages for the injuries he had sustained. He later moved to amend his complaint to add a claim against ACIA after it stopped paying him no-fault benefits. The trial court entered a default judgment against Badelalla and Basha, entered an order allowing Jesperson to amend the complaint, and entered an order severing Jesperson’s claims for trial. A jury returned a verdict of no cause of action with regard to Jesperson’s claims against Jet’s. Before trial on the remaining claim, ACIA moved for summary judgment, arguing that Jesperson’s claim against it was barred by the statute of limitations in MCL 500.3145(1). The court agreed that the statute of limitations barred Jesperson’s claim and granted ACIA’s motion for summary disposition. On appeal, the Court of Appeals affirmed, holding that the exception in MCL 500.3145(1) to the one-year limitations period when the insurer has previously made a payment applied only if the insurer has made a payment within one year after the date of the accident. Jesperson appealed, and the Supreme Court reversed. The Supreme Court found that the insurer's payment of no-fault benefits more than a year after the date of the accident satisfied the second exception to the one-year statute of limitations in MCL 500.3145(1). The Court vacated the trial court's order granting summary judgment in favor of the insurer and the case was remanded for further proceedings. View "Jesperson v. Auto Club Insurance Association" on Justia Law

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Lejuan Rambin sued Allstate Insurance Company and Titan Insurance Company, seeking payment of personal protection insurance (PIP) benefits under the no-fault act. Rambin had been injured while riding a motorcycle owned by and registered to Scott Hertzog. At the time of the accident, Rambin did not own a motor vehicle. The car involved in the accident was uninsured, but Rambin averred that Hertzog owned a car that Allstate insured. Allstate denied Rambin’s claim for PIP benefits. Rambin alternatively alleged that if Allstate was not the responsible insurer, he was entitled to PIP benefits from Titan, the insurer to which the Michigan Assigned Claims Facility had assigned his claim. Titan and Allstate moved for summary judgment, arguing that Rambin took the motorcycle unlawfully and was therefore barred from recovering PIP benefits. Rambin also moved for summary judgment, arguing: (1) that he had joined a motorcycle club even though he did not own a motorcycle; (2) that Hertzog’s motorcycle was subsequently stolen; (3) that Rambin needed a motorcycle to participate in a club ride; (4) that a colleague offered to loan him a motorcycle; and (5) that during the ride he collided with the uninsured automobile while riding the motorcycle. The trial court granted both insurance companies' motion and Rambin appealed. The Court of Appeals reversed and remanded, holding that Rambin had not taken the motorcycle unlawfully. Allstate appealed. The Supreme Court affirmed the Court of Appeals’ decision insofar as it held that plaintiff was entitled to PIP benefits if the evidence established he did not know the motorcycle he had taken was stolen. The Court disagreed, however, with the Court of Appeals’ conclusion that plaintiff was entitled to a finding as a matter of law that he did not take the motorcycle unlawfully, given the circumstantial evidence presented in this case. "The Court of Appeals improperly made findings in regard to the facts of this case that were still very much in dispute." The Court therefore affirmed in part, reversed in part, and remanded the case to the circuit court for further proceedings. View "Rambin v. Allstate Insurance Co." on Justia Law

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Acorn Investment Co. sued the Michigan Basic Property Insurance Association seeking to recover losses suffered in a fire on Acorn’s property. Michigan Basic had denied coverage on the basis that the policy had been canceled before the fire occurred. The case proceeded to case evaluation, which resulted in an award of $11,000 in Acorn’s favor. Acorn accepted the award, but Michigan Basic rejected it. The circuit court granted summary judgment in Acorn’s favor, ruling that the notice of cancellation was insufficient to effectively cancel the policy. The parties then agreed to submit the matter to an appraisal panel as permitted in the insurance policy and by statute. The appraisal panel determined that Acorn’s claim was worth $20,877. Acorn moved for entry of a judgment and also sought interest, case evaluation sanctions, and expenses for the removal of debris. The court entered a judgment in Acorn’s favor for $20,877 plus interest but declined to award case evaluation sanctions or debris-removal expenses. Michigan Basic paid the judgment, and Acorn appealed the denial of the sanctions and expenses. The Court of Appeals affirmed, but the Supreme Court affirmed in part and reversed in part. The Court held that the circuit court could award actual costs to Acorn. The Supreme Court vacated the appellate court with respect to the award of debris-removal expenses: the issue was remanded to the circuit court to determine whether the appraisal panel awarded expenses as part of its award, left them for the circuit court to determine, or whether Acorn waived its right to claim them. View "Acorn Investment Co. v. Michigan Basic Property Insurance Assn." on Justia Law