June 17, 2024
Nearly two years after the Court of Appeals’ published opinion in Williamson v AAA of Michigan, 343 Mich App 492 (2022), the Michigan Supreme Court has reversed that decision, holding that false statements submitted in support of a claim through the Michigan Assigned Claims Plan (MACP) may render an MACP claimant ineligible for payment of PIP benefits, even if those statements are made after litigation has commenced. Williamson v AAA of Michigan, 2024.
The original plaintiff in this case was Charles Williamson, who was injured as a pedestrian struck by a motor vehicle. Having no applicable No-Fault policy, he applied to the Michigan Automobile Insurance Placement Facility (MAIPF) for PIP benefits through the MACP. The MAIPF, which maintains the MACP, assigned AAA of Michigan to act as the servicing insurer for Charles Williamson.
When AAA denied his claim for PIP benefits, Williamson sued. However, he later passed away in an unrelated accident, prompting his Estate to continue his suit against AAA. In response to interrogatories sent by AAA in request for information related to attendant care and household replacement services received by Mr. Williamson, the Estate attached several forms documenting those services. Crucially, the Estate included forms representing that services had been performed for two months following Mr. Williamson’s death.
AAA brought a motion for summary disposition, arguing that the Estate had violated §3173a(4) of the Act by presenting a materially false statement in support of its claim for benefits through the MACP. The motion was granted.
On appeal, the Estate argued that the subject forms were not provided in support of its “claim,” but instead were provided to comply with discovery during litigation. The Court of Appeals agreed. It identified that section as the statute defining a “fraudulent insurance act” within the context of the MACP, and further identified Candler v Farm Bureau Mut Ins Co of Mich, as the controlling case for interpreting that statutory provision. Pursuant to Candler, it held that a statement cannot qualify as a “fraudulent insurance act” unless it is made in support of a claim.
The Court of Appeals reasoned that, within the context of the No-Fault Act, a claim often means no more than a “demand” for benefits, which it distinguished from an “action,” meaning a lawsuit filed to recover benefits. Noting that the word “action” is mentioned nowhere in §3173a(4), the Court ruled that the Legislature likely intended to limit the fraud preclusion found in that section to pre-litigation statements. Accordingly, it found that the statements made by the Estate during discovery could not render it ineligible for benefits through the MACP under §3173a(4).
On June 11, 2024, the Michigan Supreme Court published its unanimous opinion reversing that decision. The Court began by generally defining a “claim” for the sake of §3173a to be “a claimant’s demand for coverage under the MACP based on bodily injury sustained in a motor vehicle accident.” Given the reality that many No-Fault plaintiffs continue to seek care even after they have filed suit against an insurer, the prior ruling by the Court of Appeals would seem to suggest that claims for new benefits would somehow be insulated from the fraud preclusion contained in §3713a(4) merely because they were incurred after suit was initiated. The Court found nothing in the No-Fault Act to suggest this was the Legislature’s intent.
Regarding the forms submitted by the Estate, the Court determined it would be inconceivable to regard them as anything other than a claim for reimbursement of the services described therein. Accordingly, the case was remanded to the Court of Appeals for a decision consistent with its holding that post-litigation statements may be considered for purposes of §3173a(4). The Court did not comment on whether the particular statements by the Estate were “known” to be false or whether they “concerned a fact or thing material to the claim,” which are unresolved issues to be addressed by the Court of Appeals on remand.
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