September 12, 2013
In an unpublished, per curium opinion, the Michigan Court of Appeals recently found that a funeral home, which leased several limousines for the purpose of transporting families and guests to and from funerals, was in the business of transporting passengers as that phrase is used in MCL 500.3114(2).
In Hellams v Home Owners Insurance Company and Indiana Insurance Company d/b/a American States Insurance Company (COA No. 309589, rel’d 7/30/13), plaintiff was injured in a motor vehicle accident while riding as a passenger in a limousine leased by the Pye Funeral Home. Defendant Home Owners provided no-fault insurance coverage for a vehicle owned by plaintiff. American States provided no-fault insurance coverage to the Pye Funeral Home. It was undisputed that plaintiff was a passenger in one of the limousines listed on the Pye Funeral Home policy’s declaration page and that plaintiff was injured while she was being transported from the Pye Funeral Home to the Lincoln Cemetery in a funeral procession.
Testimony revealed that the Pye Funeral Home is a full-service funeral home, providing numerous funeral services including transportation to and from funerals. Such transportation was included if it was needed, in the same way a minister or religious service would be included if it was needed. Testimony further revealed that the Pye Funeral Home leased 6 limousines and 3 hearses, each of which is insured by the Pye Funeral Home. They utilize so many limousines due to the fact that they service 1200 cases each year. Whether a family is transported from the Pye Funeral Home to the cemetery is wholly up to each family, but limousines were available for anyone who choose to use them. Evidence revealed that well over half of the funerals performed by the Pye Funeral Home each year involved the use of limousines provided by the Pye Funeral Home. Sometimes the Pye Funeral Home charged for the use of its limousines, and sometimes it did not, however, the Pye Funeral Home employed 20 part-time drivers, and 3 full-time drivers, and each driver is added to their insurance policy.
Plaintiff filed suit against both Home Owners and American States seeking payment of PIP benefits to which she claimed entitlement for her injuries arising out of the accident. Home Owners, having paid PIP benefits to plaintiff, then filed a cross-claim against American States seeking a declaratory judgment that American States was the insurer of first priority for the payment of PIP benefits to plaintiff, as well as reimbursement from American States of the PIP benefits it had paid to Ms. Hellams. The Circuit Court found that transportation of passengers from the funeral home to the cemetery in the limousines was a service provided to essentially every customer who elected a cemetery burial and found that the limousine in which plaintiff was a passenger was being operated in the business of transporting passengers at the time of the accident. Thus, American States was the insurer of highest priority pursuant to MCL 500.3114(2).
The Court of Appeals affirmed the Circuit Court’s decision. The Court of Appeals held that, while transporting passengers was not the Pye Funeral Home’s primary business in the sense that its business was not solely dedicated to that activity, transporting passengers was an integral part of its business. “Pye offered transportation to those customers who chose a traditional funeral, provided transportation in more than half of all funeral services conducted during the year, and maintained a fleet of limousines for the express purpose fo transporting mourners who attended a traditional funeral.” Relying on the analysis provided by the Michigan Court of Appeals in Farmers Insurance Exchange v AAA of Michigan, 256 Mich App 691 (2003), the Court of Appeals affirmed the Circuit Court’s decision that American States was the insurer of highest priority in this case.
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POLICE VEHICLE “INVOLVED IN THE ACCIDENT” WITH MOTORCYCLE NOTWITHSTANDING NO PHYSICAL CONTACT
CONTRIBUTOR – BRYAN VALENTINE
On August 13, 2013, the Michigan Court of Appeals issued an unpublished, Per Curiam opinion in State Farm v Michigan Municipal Risk Management Authority (Docket No. 306844).
The dispute in this matter arose out of a police chase that ended in a motorcycle vs. motor vehicle accident. Shiawassee County Deputy Sheriff David Flores pursued Eugene Brothers, the operator of a motorcycle, for a violation of the speed limit. The chase reached speeds over 100 miles per hour. Deputy Flores testified that he lost Brothers at some point, but continued pursuit at a slower speed. He then came to the scene of an accident where Brothers had sustained serious injuries. Apparently, Brothers’ motorcycle had struck Denise Putnam’s Ford Explorer as there was significant damage to both the Explorer and the motorcycle. Denise Putnam later testified that she did not see any police patrol vehicle at any time prior to the collision. She only noticed the patrol car after the collision. It is not clear whether Brothers was on his motorcycle at the time that it impacted that Explorer.
State Farm, as insurer of Putnam, paid No-Fault benefits in the amount of $675,114.16. State Farm brought this lawsuit against Michigan Municipal Risk Management Authority, Inc., insurer of the County of Shiawassee, for reimbursement of 50% of all benefits paid and a declaratory judgment that MI Municipal owed a pro-rata share of PIP benefits.
Several motions for partial summary disposition were filed and a consent judgment was entered with the right of appeal preserved.
The Court of Appeals determined that the Plaintiff, State Farm, prevailed in full on appeal and may tax costs in this matter. The Court of Appeals ruled on several separate issues in its opinion:
1. The Court of Appeals held that the trial court did not err in holding that Brothers was an “operator” of the motorcycle. Defendant argued that it was entitled to have the evidence viewed in a light most favorable to it, but offered no evidence to support its position. Defendant argued, essentially, that because there was no eye-witness to the accident that the court should have inferred that Brothers was not an “operator” of the motorcycle (ie. that he was separated from his motorcycle prior to the impact). The Court of Appeals explained that a trial court may grant a motion for summary disposition based on circumstantial evidence and further explained that speculation and conjecture are insufficient to create an issue of material fact.
2. The Court of Appeals held that Plaintiff should have preserved the Ford Explorer in anticipation of this lawsuit, but, Defendant was only entitled to an adverse inference as a result of the spoliation of evidence. Defendant did not establish intentional conduct to destroy the evidence and, thus, was not entitled to an adverse presumption against Plaintiff. The Court explained that an adverse inference PERMITS the fact finder to conclude that the evidence would have been adverse to the opposing party, but does not require it. The trial court did not abuse its discretion in failing to presumptively conclude that Putnam’s vehicle would have provided evidence that Brothers was not an operator of his motorcycle at the time of the collision.
3. The Court of Appeals held that Deputy Flores’ vehicle was “involved” in the accident for purposes of MCL 500.3114(5). If both the Putnam and Flores vehicles were “involved” in the accident, Plaintiff and Defendant would be in the same order of priority and Plaintiff would be entitled to recoupment. The Court explained that there does not have to be physical contact for a vehicle to be considered “involved” in the accident. Citing Turner v Auto Club, 488 Mich 22 (1995), the Court opined that to be “involved” a motor vehicle, being operated or used as a motor vehicle, must actively, as opposed to passively, contribute to the accident. The Turner case paralleled this case in that it also involved the pursuit of a police officer. The Court of Appeals held that the police officer’s vehicle was involved in the accident because he pursued the motorcycle and perpetuated that motorcycle’s flight which resulted in the collision.
4. The Court of Appeals concluded that the One-Year-Back rule does not bar any portion of Plaintiff’s claim. The Court concluded that to allow the rule to bar reimbursement would frustrate the No-Fault Act’s purpose of reducing litigation by encouraging piecemeal litigation to comply with the rule. Further, the Defendant could offer no case that demonstrated that the rule barred recovery in similar situations.
5. The Court of Appeals held that the MCCA was not the “real party in interest” and that Defendant is not entitled to limit the reimbursement in the present action because Plaintiff also has a right to reimbursement from the MCCA. Defendant argued that because Plaintiff had paid more than the MCCA threshold amount of $375,000 that it should not be required to reimburse Plaintiff on any amount over that $375,000. The Court concluded that an insurer may seek partial recoupment from an insurer of equal priority; if, after recoupment, either insurer (or both) has paid claims in excess of the relevant reimbursement amount, either insurer (or both) may then seek reimbursement from the MCCA for the excess benefits paid.
6. Brothers’ health insurer, Blue Cross Blue Shield of Michigan, paid over $200,000 of PIP benefit claims that were also paid by Plaintiff. The Court of Appeals held that in the absence of coordination, a No-Fault insurer is primarily liable for benefits paid to an insured. The Court explained that Brothers’ entitlement to benefits arose not from any insurance policy, but from statute. Thus, any windfall granted to Brothers was granted by his health insurance, not from the Plaintiff. The Court expressed no opinion regarding BCBSM’s right to reimbursement from Brothers, as that would depend on the policy language.
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REGISTER NOW: BUCKEYE SEMINAR
THE BUCKEYE SEMINAR WILL TAKE PLACE ON THURSDAY OCTOBER 17, 2013 AT THE GREATER COLUMBUS CONVENTION CENTER. PLEASE CONTACT EILEEN CARTY AT (248)641-7600 OR ecarty@garanlucow.com Following is the Agenda:
8:30 – 9:00 a.m. CONTINENTAL BREAKFAST / REGISTRATION
9:00 – 9:05 a.m. WELCOME AND INTRODUCTION
Speaker: SUSAN M. WILLIAMS
9:05 – 9:35 a.m. NO-FAULT LAW UPDATES
Speaker: SUSAN M. WILLIAMS
9:35 – 10:05 a.m. TRANSPORTATION & HOME ACCOMMODATION ISSUES POST ADMIRE
Speaker: BRYAN VALENTINE
10:05 – 10:35 a.m. TIPS & STRATEGIES IN DEFENDING PIP PROVIDER LAWSUITS
Speaker: STACEY L. KING
10:35 – 10:50 a.m. BREAK
10:50 – 11:20 p.m. WORK LOSS CLAIMS:
DEALING WITH SELF EMPLOYED & SMALL BUSINESS CLAIMANTS
Speaker: NATHAN WELCH
11:20 – 12:30 p.m. DEPOSITION/TRIAL TESTIMONY TIPS FOR CLAIMS ADJUSTERS:
PRODUCING/KEEPING CLAIMS FILES
Speaker: JOHN W. WHITMAN
12:30 – 1:00 p.m. QUESTION & ANSWER SESSION
RETURN EVALUATION FORMS
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REGISTER NOW: BASICS OF MICHIGAN AUTOMOBILE NO FAULT INSURANCE LAW COURSE
Garan Lucow Miller, P.C. will be teaching the Basics of No Fault course on Tuesday evenings from October 1 through November 26, 2013. The classes will be held at the Lexington Hotel (soon to be named Crowne Plaza), 925 S. Creyts Road, Lansing, Michigan 48192 from 6:00 p.m. to 8:00 p.m.
The cost for this 9 week course will be $350.00 per person. GLM will offer a discounted rate for our clients that register 2 or more from the same company.
Please contact Eileen Carty at ecarty@garanlucow.com to register, or call at (800) 875-7600.
Following is the Course Curriculum:
Week 1: October 1, 2013
Introduction – Why Does Michigan Keep No Fault?
Lecturer: John Whitman, GLM Ann Arbor office
Course Approach and Review of Materials.
A. History of Michigan No Fault.
B. Future of Michigan No Fault in light of recent proposed legislation, including discussion of Catastrophic Claims Fund established by Section 3104.
C. Discussion of mandatory insurance.
D. Review of transfer of title and registration process.
Week 2: October 8, 2013
Mandatory Insurance and Definitions
Lecturers: Adam Gordon, GLM Ann Arbor office
Susan Williams, GLM Troy office
The Contract of Insurance – Certificate of Insurance – Rules of Interpretation – No Fault Definitions; Security Required; Penalties for Non-Compliance – Sections 3101, 3102 and 3103.
A. Review No Fault manual (pp. 1-17).
Residual Tort Liability – Interplay Between First Party and Third Party No Fault – Sections 3131 and 3135.
A. Review No Fault manual (pp. 99-112).
Week 3: October 15, 2013
Coverage and Exclusions
Lecturer: Daniel Saylor, GLM Detroit office
No Fault Coverage (i.e., entitlement) – Section 3105.
A. Review No Fault manual (pp. 19-29).
Exclusions from Coverage – Section 3106.
A. Review No Fault manual (pp. 31-38).
Exclusions from Coverage – Section 3113.
A. Review No Fault manual (pp. 71-74).
Week 4: October 22, 2013
Which Insurer Pays?
Lecturer: David Campos, GLM Grand Rapids office
Order of Priorities – Motor Vehicle Occupants – Section 3114 and Motorcyclists.
A. Review No Fault manual (pp. 75-83).
Order of Priorities for Non-Occupants – Section 3115.
A. Review No Fault manual (pp. 85-88).
Order of Priorities – Assigned Claims Facility – Sections 3171-3176; Out-of-State Accidents – Section 3111; Pro rata Sharing – Sections 3114(6) and 3115(2).
A. Review No Fault manual (pp. 141-146; 67-68; 85-88).
Week 5: October 29, 2013
Benefits – Allowable Expenses and Property Protection Insurance
Lecturers: David Couch, GLM Grand Rapids office
Stacey King, GLM Detroit office
Benefits – Allowable Expense – Sections 3107(1)(a) and 3151-3159.
A. Review No Fault manual (pp. 39-44; 133-136).
Benefits – Property Protection Insurance – Sections 3121-3127.
A. Review No Fault manual (pp. 93-98).
Week 6: November 5, 2013
Benefits – Wage Loss, Replacement Services and Survivors’ Loss
Lecturer: William Brickley, GLM Grand Blanc office
Benefits – Wage Loss and Service Reimbursement – Section 3107(1)(b) and (c); Temporarily Unemployed – Section 3107a.
A. Review No Fault manual (pp. 39-49).
Benefits – Survivors’ Loss – Section 3108; Distribution of Benefits – Sections 3110 and 3112.
A. Review No Fault manual (pp. 51-53; 63-65; 69-70).
Week 7: November 12, 2013
Computation of Benefits – Limitations, Deductibles, and Coordination
Lecturers: Edward Freeland, GLM Troy office
Robert Goldenbogen, GLM Port Huron Office
Computation of Benefits – Non-Duplication – Section 3115(3); Governmental Setoffs – Section 3109(1); Coordination of Benefits – Section 3109a.
A. Review No Fault manual (pp. 85-88; 54-61).
Coordination of Benefits with Private Health Insurance Plans.
Week 8: November 19, 2013
Statute of Limitations and Penalties
Lecturer: Emily Ross, GLM Troy office
Time Limitations – Sections 3145, 3146, and 3141.
A. Review No Fault manual (pp. 119-124; 113-114).
Penalties for Late Payment – Interest and Attorney Fees – Sections 3142 and 3148.
A. Review No Fault manual (pp. 113-117; 125-131).
Insurer’s Certification of Out-of-State Policy – Section 3163.
A. Review of No Fault manual (pp. 137-139).
Week 9: November 26, 2013
Deposition and Trial Skills Necessary for Defending No Fault Cases
Lecturer: John Whitman, GLM Ann Arbor office
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SAVE THE DATE | WINDY CITY SEMINAR
THE WINDY CITY SEMINAR WILL TAKE PLACE ON WEDNESDAY NOVEMBER 13, 2013 AT THE MARRIOTT SCHAUMBURG . WATCH LAW FAX FOR FURTHER DETAILS.