Author(s): James L. Borin, Simeon R. Orlowski, Matthew S. LaBeau

Mr. LaBeau is an Associate with the Firm’s Detroit Office and can be reached at (313)446-1530 or


Volume XXII, No. 19 June 30, 2010
LAW FAX MICHIGAN LAW – BLUE | INDIANA LAW – RED Garan Lucow Miller, P.C. 1111 West Long Lake Road, Suite 300 Troy, Michigan 48098 248.641.7600

From the Co-Editors James L. Borin & Simeon R. Orlowski
On June 17, 2010, the Michigan Court of Appeals issued an unpublished opinion in the case of Rosemary Knowles v. Progressive Michigan Ins. Co., Mark Kiebler, and Farmers Ins. Exchange. The Court’s decision addressed the issue of whether the testimony of a claims adjuster would be relevant to the issue of medical causation at the trial of a claim for first party No- Fault benefits. The Court held that such testimony was properly excluded by the trial court. Plaintiff was involved in a 1999 motor vehicle accident with applicable coverage through Farmers and a 2005 motor vehicle accident with applicable coverage through Progressive.

Plaintiff filed suit in the Monroe County Circuit Court seeking benefits from both insurers. Both insurers contended that Plaintiff’s injuries were not related to their respective motor vehicle accidents.

Prior to trial, Defendant Progressive filed a motion in limine arguing that the deposition testimony of its adjuster should be excluded from being read into evidence by Plaintiff’s counsel. Defendant Farmers filed a concurrence with Defendant Progressive’s motion, arguing that the testimony of its adjuster would be irrelevant and any testimony of its adjuster regarding the issue of medical causation would not have a proper foundation. The trial court granted Defendant Progressive’s motion, finding that the testimony of the adjusters would not be relevant to the issue of causation at trial and Plaintiff’s statutory right to cross examine the opposite party pursuant to MCL 600.2161 and MRE 611 would not be violated. Plaintiff appealed this ruling. The Michigan Court of Appeals affirmed the trial court. The Court noted that evidence is only relevant and admissible if it tends to make the existence of a fact at issue more probable or less probable. In this case, neither adjuster at deposition made any admission as to the cause of Plaintiff’s injuries. Neither adjuster disputed that Plaintiff had a lower back injury. Rather, each adjuster denied that Plaintiff’s injuries were caused by the motor vehicle accident it insured against. The Court of Appeals found that the testimony of either adjuster regarding how or why Plaintiff was denied PIP benefits was not relevant because it would not have tended to make the material fact at issue during trial, i.e. medical causation, more or less probable. The Court also rejected Plaintiff’s argument that his statutory right to cross examine the opposite party was violated. The Court noted that Plaintiff only had the right to cross examine the opposite party to seek out the truth of the matter regarding a disputed issue. Since the trial court had properly found that the testimony of Defendants’ adjusters had no relevance to the causation issue, Plaintiff’s right to cross examination was not violated.

While this opinion is unpublished, it does constitute persuasive authority to trial courts throughout the State of Michigan. This opinion significantly limits the ability of a Plaintiff’s attorney in a PIP case to utilize the testimony of a claims adjuster at the time of trial. It is widely known that the Plaintiff’s bar seeks to harass claims adjusters by seeking their depositions and, then misrepresenting the testimony by claiming that the claims adjuster had made damaging admissions regarding the claim even though there was no foundation for the testimony. In light of this opinion, the testimony of a claims adjuster should be excluded from evidence unless it is somehow relevant to a disputed issue at trial. More importantly, this opinion can be used to oppose the Plaintiff’s bar’s attempts to use testimony regarding the handling of a claim to divert the jury’s attention from the actual issues to be decided. Garan Lucow Miller, P.C. is pleased to note that John Whitman of the Ann Arbor office handled this matter on behalf of Progressive at the trial level, and Daniel Saylor of the Detroit office handled this matter at the appellate level.

2Mr. Heikkila is a Partner in the Firm’s Marquette Office and can be reached at (906)226-2525 or On June 11, 2010, the Michigan Supreme Court denied defendants’ Motion for Reconsideration and thus, the Appellate Commission’s decision in Trammel v Consumers Energy Company, 2009 ACO #126, remains the current state of the law regarding certain specific loss benefits. Interestingly, Michigan Supreme Court Justice Corrigan issued the following concurring opinion:

“I write separately to acknowledge the argument, made by the defendant and its amici, that the opinion of the Workers’ Compensation Appellate Commission (WCAC) will ultimately authorize significantly more benefits than the Legislature intended for workers claiming limb loss. In particular, the briefs observe that the increasing prevalence and success of joint replacement surgery militates against providing scheduled loss benefits under MCL 418.361(2) to an employee whose limb is returned to usefulness by way of internal, surgical correction. These concerns are best addressed to the Legislature, which has the power to amend the statutes on which the WCAC relied.”

Specific or scheduled loss benefits are paid pursuant to Section 361(2) of the Michigan Workers Disability Compensation Act. For example, the following losses would result in the listed number of weeks of wage loss benefits:

•Hand 215 •Arm 269 •Foot 162 •Leg 215

The benefits are payable for the periods of time noted above regardless of whether the claimant returns to work at an earlier time. The employee does not have to demonstrate an entitlement to general disability benefits to receive the specific loss benefits. In Trammel, the Magistrate found that the plaintiff suffered a specific event knee injury in June of 1984. He apparently was stepping down from the back of his truck and twisted his left knee. He underwent arthroscopic surgery and returned to work without restrictions after three 3Ms. Gordon is an Associate in the Firm’s Detroit Office and can be reached at (313)446-1530 or

months. The Magistrate also found that the claimant sustained a second specific event left knee injury on December 12, 2005. The claimant stepped into a hole and jammed his left knee. The plaintiff then underwent a total knee replacement surgery on April 12, 2006, and returned to work, without restrictions on July 10, 2006. The claimant then retired from active employment in October of 2007.

The Magistrate granted a closed period of wage loss benefits, plus medical benefits and specific loss benefits, all related to the left knee/leg. The defendants then initiated an appeal with the Appellate Commission, arguing, in part, that the Magistrate erred in granting specific loss benefits for loss of the leg.

The Appellate Commission held that, for specific loss benefits under Section 361(2) of the Act, the standard to be applied was the “uncorrected standard.” In that case, the Appellate Commission examined the condition of the claimant’s leg before surgery and not after the procedure. In conjunction with the uncorrected standard, the Commission indicated that specific loss includes not only amputation, but “loss of usefulness.” The Appellate Commission found that the claimant’s knee was so damaged before the surgery that the surgical implant was uncontested. The Appellate Commission affirmed the Magistrate’s opinion permitting specific loss benefits for the leg. Thus, per the Trammel decision, benefits for specific loss of the entire leg are determined by an uncorrected standard. In a non-amputation setting, the test is “loss of usefulness of the limb” prior to the corrective surgery.

I would note that plaintiffs are utilizing the Trammel decision to allege specific loss benefits for loss of the entire leg in surgeries involving replacement knee or hip. Section 361(2)(k) of the Act provides for 215 weeks of specific loss benefits for the leg. The Act provides that if a worker suffers consecutive losses of two or more members, benefits are paid consecutively, rather than concurrently.


In United Services Automobile Association v Michigan Catastrophic Claims Association (No 289579, published decision, June 22, 2010), the Court of Appeals determined that the MCCA was

not required to indemnify USAA for PIP benefits it paid to and on behalf of its insured, Raoul Farhat, M.D., because the vehicle involved in the accident, and insured under a Michigan No-Fault policy, was not required to be registered in Michigan.

On August 9, 1996, Farhat was involved in an accident in Florida while operating his LeBaron vehicle, which was insured under a Michigan No-Fault policy issued by USAA, but registered and titled in Florida. At the time of the August 9, 1996 accident, Dr. Farhat was licensed to practice medicine in Michigan and Florida, and was a member of the Michigan National Guard. Farhat lived with his ex-wife in Florida from some time in 1995 until the accident. Farhat owned a residence in Michigan at the time of the accident and had family living in Michigan. He also grew up in Michigan and lived in Michigan before 1995.

Dr. Farhat maintained Michigan No-Fault insurance with USAA for four vehicles, two of which were garaged in Michigan. Then, in December 1995, Dr. Farhat insured the LeBaron through his Michigan No-Fault policy with USAA. The underwriting department, however, mistakenly omitted the LeBaron from his policy, but after the accident the policy was retroactively reformed to include coverage on the LeBaron.

USAA initiated this lawsuit seeking reimbursement from the MCCA for PIP benefits it paid to and on behalf of Farhat. On appeal, USAA argued that Farhat properly insured the LeBaron under Michigan law because of Farhat’s ties with Michigan; Farhat had family and property in Michigan, Farhat was licensed to practice medicine in Michigan, and Farhat traveled to Michigan for obligations to the military. On the other hand, the MCCA argued that it was permissible for it to review a coverage decision, and that Farhat should not have been insured via a Michigan nofault policy written by USAA for an accident that occurred in Florida in a vehicle that was both purchased and registered in Florida.

In reaching its decision that the MCCA was not required to indemnify USAA, the Court first determined that under the facts of this case, Farhat was not a “resident” of Michigan at the time of the accident. The Court held that he was a nonresident for purposes of the No Fault Act. The Court then analyzed whether Farhat can alternatively be deemed a resident of Michigan for purposes of the act if the LeBaron was otherwise “required to be registered” in Michigan. See In re Certified Question, 433 Mich 710, 719-20; 449 NW2d 660 (1989). The Court examined MCL 257.216(a) and MCL 257.243(1), both part of the Michigan Motor Vehicle Code, and determined that both statutes indicate that nonresident owners are not required to register their motor vehicles in Michigan. Thus, as a nonresident, Dr. Farhat was not required to register the LeBaron in Michigan.

The Court then examined MCL 500.3101(1) and MCL 500.3102(1) to determine whether Farhat was required to insure the LeBaron in Michigan. MCL 500.3101(1) requires the owner or registrant of a motor vehicle required to be registered in Michigan to maintain no-fault insurance on the vehicle. MCL 500.3102(1) provides that a nonresident owner or registrant of a motor vehicle not registered in Michigan shall not operate or permit the motor vehicle to be operated in Michigan for an aggregate of more than 30 days in any calendar year unless he maintains no-fault insurance. USAA had argued that Farhat, as a nonresident, was entitled to maintain no-fault insurance on the LeBaron under 3102(1). Since Farhat maintained no-fault insurance on the 4Mr. Light is an Associate in the Firm’s Lansing Office and can be reached at (517)327-0300 or

vehicle, USAA argued it was obligated to pay PIP benefits to Farhat and, thus, the MCCA should be required to reimburse USAA. See MCL 500.3104(2). The Court of Appeals, however, concluded that upon reading MCL 500.3101(1) and 500.3102(1) in pari materia with MCL 257.216(a) and 257.243(1), the LeBaron vehicle was not required to be registered in Michigan and because it was not operated in Michigan, it was not required to be insured in Michigan. In short, the Court of Appeals concluded that the MCCA need only indemnify an insurer under MCL 500.3104(2) where the insurer paid benefits pursuant to a policy written in Michigan that provided for the required security under MCL 500.3101(1) for a vehicle required to be registered in Michigan. The Court concluded as a matter of law that Farhat’s LeBaron was not required to be registered in Michigan and, therefore, MCL 500.3101(1) does not apply, and the MCCA was not required to reimburse USAA.


CONTRIBUTOR – GREGORY A. LIGHT4 In the recently published opinion of Henry Ford Health System v Esurance Insurance Company, the Michigan Court of Appeals held that Plaintiff was entitled to payment for medical services provided to the passenger of a stolen vehicle who had not taken the vehicle, or participated in the taking of a vehicle. The passenger to whom services were provided by Plaintiff, Henry Ford Health System, was Travion Hamilton, who was severely injured when a stolen Jeep Cherokee he was riding in struck a utility pole. The driver of the Jeep at the time of the accident was Hamilton’s girlfriend, Chanda Profic, who had borrowed the Jeep from an acquaintance for a small fee. Upon taking the vehicle, Profic was not provided any keys, the ignition cylinder had been removed and the door lock on the driver’s side was also missing. Moreover, Profic did not know how to restart the vehicle, leaving the engine running. Profic later picked up Hamilton who remained a passenger while Profic drove the vehicle around for 3-5 hours. Hamilton never operated or drove the Jeep, but simply rode along as a passenger.

The trial court entertained and denied cross-motions for summary disposition, ruling there were genuine issues of material fact that precluded the entering of same. The case proceeded to trial and a judgment of a no-cause of action was entered, with the jurors finding that Hamilton was using the Jeep at the time of the accident, that he had unlawfully taken the vehicle, and that Hamilton did not reasonably believe that he was entitled to take and use the Jeep. Henry Ford appealed, arguing that it was entitled to its claim for payment as a matter of law given that there was a complete absence of evidence that Hamilton himself had taken the stolen vehicle, let alone taking it unlawfully.

Defendant Esurance argued that Hamilton was barred from recovering No-Fault PIP benefits under MCL 500.3113(a), which provides:

A person is not entitled to be paid personal protection insurance benefits for accidental bodily injury if at the time of the accident any of the following circumstances existed:

(a) The person was using a motor vehicle or motorcycle which he or she had taken unlawfully, unless the person reasonably believed that he or she was entitled to take and use the vehicle.

Henry Ford argued that Hamilton never engaged in the active “taking” of the Jeep from anyone; rather, it had already been “taken” by the time he hopped into the vehicle and rode along as a passenger. To assist the Court of Appeals in making this determination, it reviewed its recent decision in the case of Amerisure v Plumb, 282 Mich App 417 (2009) wherein the court analyzed the specific language of Section 3113(a). The court in Plumb stated that “take” means to get something into one’s hands or possession through a voluntary action and the words “had taken” reflect a past or completed action. Accordingly, the court in this case believed that Section 3113(a) envisioned an accomplished or completed taking of a motor vehicle followed by its use during which the accident occurs giving rise to injuries.

Utilizing that analysis, the Court of Appeals in this case found no evidence that Hamilton engaged or participated in an act through which he took possession or gained control of the Jeep. Also, there was no act transferring possession or control of the Jeep from Profic or others to Hamilton, nor did Hamilton take possession or control of the vehicle that was unintended and not within anyone’s control or possession. Hamilton never took the Jeep from any one or any place. Rather, the thief who directly took the Jeep away from the owner, or possibly Profic, would more accurately be described as having taken the vehicle, with Hamilton thereafter joining in for the use of same, but Hamilton never took control or possession of the vehicle away from Profic.

According to the Court of Appeals, the fact that Hamilton was “using” the vehicle at the time of the accident is not determinative because there is no evidence that he took or participated in the taking of it. The clear and unambiguous language of the statute required the “taking” and “use” of the vehicle. The court explained that this language clearly shows that a person must both take and use a vehicle, which is also consistent with the preceding language in Section 3113(a) that speaks of “using” a vehicle a person had “taken”. Hamilton used the Jeep, but he did not take the Jeep.

The court went on to look at several other similar decisions to find that the case law did not conflict with its resolution of this case. Those cases include Mester v State Farm, 235 Mich App 84 (1999); Priesman v Meridian Mutual, 441 Mich 60 (1992); Butterworth Hospital v Farm Bureau, 225 Mich App 244 (1997); Bronson Methodist Hospital v Forshee, 198 Mich App 617 (1993); and, Landon v Titan, 251 Mich App 633 (2002) distinguishing those cases from the instant case because the individual for whom benefits were sought engaged or participated in the unlawful taking of the involved motor vehicle, which we do not have here.

The Court of Appeals, in rendering this decision, believes the Legislature clearly intended in drafting this statute that it be focused on the person or persons engaged in the taking of a motor vehicle for purposes of the PIP benefits exclusion, without contemplating scenarios in which persons may also have been involved in criminal activities associated with the use of the vehicle. Accordingly, the Court of Appeals ruled that the trial court erred in denying Henry Ford Health Systems’ motion for summary disposition because there was no evidence that Hamilton was using a motor vehicle that he had taken unlawfully.

************************************** Upcoming Seminars ANNUAL TROY BREAKFAST SEMINAR Thursday, September 23, 2010 at the Troy Marriott. Agenda to follow at a later date. BUCKEYE SEMINAR Wednesday, October 13, 2010 at the Greater Columbus Convention Center in Columbus, Ohio. Agenda to follow at a later date.


SAVE THE DATE The 3rd Annual Cherry- Roubaix Race, sponsored by Garan Lucow Miller, P.C., will be held on Saturday and Sunday, August 28th and 29th, 2010, through the historic streets in the heart of Traverse City.

Mark your calendars to join us at this exciting event. If you have any questions or would like additional information on this race, please go to or contact Peter Worden, in our Traverse City office at: (231) 941-1611.


Event: Garan Lucow Miller’s Annual Golf Outing Date: Tuesday, August 24, 2010 Venue: Forest Akers West Golf Course on the campus of MSU Banquet dinner to be on campus at the University Club


Garan Lucow Miller, P.C., a full-service law firm since 1948, providing quality representation to a national clientele from the Great Lakes Region, is pleased to announce that it has opened an office in Merrillville, Indiana, to further facilitate your claim and litigation needs in Indiana and Illinois. Garan Lucow Miller, P.C. 8401 Virginia Street Merrillville, Indiana 46410 Phone: 219.756.7901 Fax: 219.756.7902 Toll Free: 877.804.2801