Bashir Mehtar v. Fremont Insurance Company, et al., unpublished opinion per curiam of the Michigan Court of Appeals issued June 2, 2022 (Docket No. 357086)
In this case, the Michigan Court of Appeals ruled trial courts are required to view evidence in the light most favorable to the non-moving party in response to a dispositive motion, such that the court must consider the opinions of an insurance carrier’s Independent Medical Examination (IME_ report when determining if there is a genuine issue of material fact whether the plaintiff suffered certain injuries in a car accident.
The plaintiff pursued Personal Injury Projection (PIP) benefits against Fremont Insurance Company with respect to neck and back injuries he allegedly sustained in a car accident. Fremont denied the plaintiff’s PIP benefits following an IME report which opined that the plaintiff did not have ongoing neck injuries at the time of the IME but was otherwise silent with respect to whether he had continuing back injuries. Following the denial of benefits, the plaintiff filed a lawsuit against Fremont. The plaintiff later moved for summary disposition, arguing that there was no genuine issue of material fact that his neck and back injuries “arose out of the” accident.
In support of his motion, the plaintiff attached and cited various medical records showing his diagnosed injuries. Fremont opposed the motion and argued that its IME report was sufficient to create a genuine issue of material fact as to whether the plaintiff’s alleged injuries “arose out of the accident.” The trial court disregarded the conclusions in the IME report and granted summary disposition in favor of the plaintiff.
Insurers need only pay PIP benefits for injuries “arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle.” An injury “arises out of” an accident when there is a “casual connection between the injury and the use of a motor vehicle as a motor vehicle is more than incidental, fortuitous, or ‘but for.’” In support of his motion, the plaintiff was required to present “affidavits, depositions, admissions, or other documentary evidence” showing the casual connection between the alleged neck and back injuries and the accident.
The appellate court reversed the trial court’s decision. In particular, the appellate court determined that the documentary evidence attached to the plaintiff’s motion only concerned his alleged neck injuries; that is, while the plaintiff alleged both neck and back injuries, his motion did not include any evidence showing that he suffered back injuries, or that those injuries “arose out of” the accident.
Trial courts are required to view admissible evidence in light most favorable to the non-moving party. As such, the trial court erred when it ignored the conclusions in Fremont’s IME report concerning the absence of neck injuries, which was sufficient to show a genuine issue of material fact whether the plaintiff’s alleged neck injuries “arose out of” the accident. And while the IME report did not address the plaintiff’s back injuries, a genuine issue of material fact whether such “arose out of” the accident because the plaintiff’s motion did not include sufficient evidence concerning his alleged back injuries.
Harris Cheema, et al. v. Progressive Marathon Insurance Company, State Farm Mutual Automobile Insurance Company, et al., unpublished opinion per curiam of the Michigan Court of Appeals, issued June 2, 2022 (Docket No. 355910)
The trial court in this case concluded that there was no question of fact that the insurance provider established a mutual rescission at law. However, the Michigan Court of Appeals found that the trial court erred when determining that the defendant insurer was entitled to rescind the contract as a matter of law because there was a factual dispute as to whether the plaintiff accepted the rescission, and whether the misrepresentation was innocent.
Harris Cheema was the owner of Overland Transportation. Overland was in the business of transporting patients to and from medical appointments. Overland was paid by the patients’ insurance companies, not directly by the patients. Cheema worked with an agency to apply for and obtain an insurance policy for Overland and its company-owned vehicles, which Cheema used for both personal and business purposes (the underlying accident occurred while he was using an Overland vehicle for personal errands).
Cheema and the Agency introduced conflicting evidence as to the discussions and their understanding as to the scope of vehicle use under the policy – namely, whether the vehicles were for commercial use. Pursuant to the application, the defendant, Progressive Marathon Insurance Company, issued a policy to Overland for non-commercial use. Cheema was later involved in an accident while using an Overland vehicle to run personal errands. After Cheema filed a lawsuit for Personal Injury Protection (PIP) benefits, Progressive attempted to rescind the policy without court intervention by issuing Cheema/Overland a refund of all policy premiums and issuing a letter indicating that the policy was rescinded.
Owners and registrants of motor vehicles in Michigan are required to maintain mandatory types of automobile insurance. However, the insurance policies themselves are still subject to the common law of contracts (as modified by the Michigan No-Fault Act). Common law remedies available to an insurer include fraud and misrepresentation, which include the remedy of rescission. Rescission is an equitable remedy that allows a party who was fraudulently induced to enter into a contract to void that contract (i.e., rescission abrogates a contract and restores the parties to the relative positions that they would have occupied had the contract never been made).
In this case, Progressive asserted the right to rescind Overland’s policy as a remedy for having been fraudulently induced to enter into the contract. To prevail on a motion for summary disposition asserting rescission on the basis of fraud in the inducement, Progressive had to establish that there was no genuine issue of material fact that: (1) Overland made a material misrepresentation, (2) the representation was false, (3) Overland knew it was false or made the representation with reckless disregard for the truth, and (4) Overland made the representation with the intention that Progressive would act on it.
Elements 1, 2, and 4 are undisputed. Cheema/Overland misrepresented whether Overland’s vehicles would be used for commercial purposes when he applied for insurance with Progressive. The misrepresentation was material because Progressive introduced evidence that it would not have issued that policy had it known the Overland’s vehicles would be used for commercial purposes. The representation was false because Overland’s vehicles were being used for commercial purposes when the policy was written for non-commercial use. Finally, Cheema/Overland made the representation (how its vehicles were to be used) with the intention that Progressive would act on it (by issuing the insurance policy).
However, the trial court properly determined that there was a genuine issue of material fact with respect to whether Cheema/Overland knew its representation was false when it was made. Specifically, there is conflicting evidence between Cheema/Overland and the insurance agency that submitted the application to Progressive. In essence, Cheema/Overland and the agency disputed whether certain terms were discussed and/or explained when the application was executed and submitted to Progressive. Still, Cheema/Overland was adamant that its vehicles were always for non-commercial use because he was being paid by insurance companies to transport patients, as opposed to receiving payment directly from the patient.
Still, because “whether an insured has committed fraud is generally a question of fact for the jury to determine,” the trial court denied Progressive’s motion for summary disposition for “fraud in the inducement.” Nevertheless, the trial court still opined that Summary Disposition was warranted in favor of Progressive on the grounds of mutual rescission. A mutual rescission occurs by implication when the parties, by their actions, mutually abandon all further performance and treat the contract as at an end, or when one of the parties distinctly abandons all rights and obligations under the contract and the other accepts the situation so created.
Progressive argued Overland took actions that demonstrated that it accepted Progressive’s decision to rescind the policy and treated the policy as rescinded. Progressive relied upon a case from the 1930s for the proposition that Overland’s use of the refunded policy premiums established a mutual rescission as a matter of law. However, the trial court found that this case was distinguishable from the 1930s case relied upon by Progressive because there is no evidence that insurance provider put Overland on notice that acceptance and use of the refunded policy premiums the insurer would be agreeing to the would-be rescission. As such, the Michigan Court of Appeals determined that the trial court erred in granting summary disposition in favor of Progressive on mutual rescission because there was a genuine dispute of material fact whether Overland’s use of the refunded policy premiums constituted actions that suggests it acquiesced to the rescission.
The appellate court found the trial court to have further erred in granting summary disposition in favor of Progressive on mutual rescission because it improperly treated the plaintiff, Cheema, the same as Overland, which is the named insured). When determining whether to apply an equitable remedy such as rescission, a trial court must balance all the equities, including the rights of third parties such as Cheema. Because the trial court failed to discuss any of the factors in the delicate balancing of the equities, especially since Cheema is technically a third party to the policy, the appellate court further concluded the order for rescission was improper.
Cheema is the sole owner of Overland, a medical transportation company that transports patients to and from medical appointments. Cheema used Overland’s vehicles for business and personal purposes. Cheema obtained a Progressive insurance policy through Saeidi at Golden Insurance Agency, LLC. In the application, Cheema stated that Overland was not transporting passengers for hire and testified that Overland was not a business engaged in transportation for hire because Overland received payment from third-party payors (i.e., insurers) and did not receive payment from the people it transported. At the time of the accident, Cheema was driving an Overland vehicle on a personal errand. Subsequently, Progressive rescinded the policy ab initio due to misrepresentation or fraud.
Griffin Wasik v. Progressive Marathon Insurance Company, et al., published opinion of the Michigan Court of Appeals issued June 2, 2022 (Docket No. 355910)
In this case, the Michigan Court of Appeals ruled a "‘hit and run vehicle’" means a vehicle that hits another vehicle, and the driver leaves the scene of the accident—either without stopping or at any time before an exchange of information can take place.
The plaintiff in this case was a passenger involved in a two-car collision when a Ford Explorer approaching from behind slid on a patch of ice and struck the plaintiff’s vehicle. Immediately following the collision, both motorists pulled over to the side of the road and exited their vehicles to inspect damage. Neither vehicle sustained much damage, and no one was injured. The motorists agreed not to call the police. Instead, they agreed to part ways, and did so before they exchanged personal/contact information with another.
Although he denied injury at the scene, the plaintiff soon reported various complaints, was diagnosed with a concussion, and later sought recovery of Uninsured Motorist (UM) benefits against the defendant, Progressive Marathon Insurance Company. Specifically, the plaintiff argued that he was entitled to UM benefits under Progressive’s insurance policy because the Ford Explorer involved in the accident was a “hit and run vehicle.” In this case of first impression, our appellate court addressed:
Whether the phrase “hit and run vehicle” under an auto insurance policy includes a vehicle that is pulled over after hitting another vehicle, the drivers of both vehicles exit the cars and inspect the vehicles for damage, and mutually conclude that because no damage exists, there is no need to contact the police or exchange insurance information?
“Because providing coverage for UM Benefits is optional and not mandated under the Michigan No-Fault Act, the policy language controls the circumstances entitling a claimant to an award of UM Benefits.” Courts interpreting provisions in an insurance policy for non-statutorily mandated coverage generally use the standards for reading and applying provisions “in the same manner as other contracts,” such as enforcing unambiguous contract provisions as written, refusing to enforce ambiguous contract provisions, and construing ambiguous contract provisions against the insurer and in favor of coverage. But a contract, or policy, provision is not ambiguous “merely because a term is not defined in the policy, nor simply because the parties disagree on its meaning.”
In this case, there is no dispute that in order for the plaintiff to obtain UM coverage under Progressive’s policy, he must establish that: (1) a hit-and-run vehicle (2) whose operator is unknown or cannot be identified (3) made direct contact with the motor vehicle the plaintiff was occupying.
While recovery of UM coverage is contingent upon whether the Ford Explorer is a “hit-and-run vehicle,” the policy did not define “hit-and-run vehicle.” Therefore, the appellate court was required to determine the plain and ordinary meaning of “hit-and-run.” But at the same time, the appellate court must consider the accompanying language within the policy provision. For example, the dictionary defines “hit-and-run” as “being or involving a motor vehicle driver who does not stop after being involved in an accident.” However, if the identity of the striking and fleeing vehicle is known, coverage for UM benefits would not be available under the terms of the policy. Therefore, it is not just a fleeing vehicle that triggers coverage for UM, as the operator of the striking vehicle must also be unknown.
Neither the plaintiff nor the defendant identified any Michigan case that dissected the meaning of “hit-and-run vehicle” under an auto insurance policy. However, the parties presented cases and decisions rendered by other states that addressed almost identical fact patterns and policy provisions. While it considered these out-of-state opinions, the appellate court confirmed its desire to adopt a rule that incorporated common understanding but still anchored in the language and spirit of insurance policies with coverage for UM; in particular, the requirement that the identity of the operator of the fleeing vehicle is either unknown or cannot be identified.
Accordingly, the appellate court held that:
“Under these contracts, ‘hit and run vehicle’ means a vehicle that hits another vehicle and the driver leaves the scene of the accident—either without stopping or at any time before an exchange of information can take place.”
The requirement that the driver (of the “hit-and-run vehicle”) be unidentified for UM coverage to apply under the policy means that the “run” has to occur before the opportunity to exchange information can take place. And that type of “run” occurs if a vehicle feels without stopping (at the scene), or if the vehicle stops buts leaves before there is an opportunity to exchange information.
Applying the appellate court’s holding to the facts of this case, the appellate court affirmed the trial court’s decision to grant summary disposition in favor of Progressive. Recovery of UM coverage was contingent upon the plaintiff’s involvement in an accident with a hit-and-run vehicle. But the Ford Explorer did not constitute a hit-and-run vehicle under the policy because it is undisputed that the driver of the Ford Explorer did not flee the scene after the collision; he pulled over, assessed vehicle damage, and spoke with the operator of the plaintiff’s vehicle. Moreover, the driver of the Ford Explorer left the scene after he was told no one in the plaintiff’s vehicle suffered any injuries, that there was no vehicle damage, and that the motorists agreed not to call police. As such, the driver of the Ford Explorer did not “run” from anything, as he remained at the scene so that there was an opportunity to exchange information.
Wasik extends a long line of cases involving UM/UIM coverage and adopts a rule that will properly help define the scope of potential coverage for Uninsured (UM) and Underinsured (UIM) benefits alike. Wasik addressed whether an alleged “hit-and-run” driver “ran” after the collision.
The rule adopted by the appellate court in Wasik led to a denial of UM coverage because the facts of the accident revealed that the driver of the Ford Explorer did not “run.” Insurance carriers handling claims for UM/UIM coverage must pay close attention to a claimant’s recollection of the accident and its aftermath early and often. If available, use of examinations under oath or similar methods can assist insurance carriers in early detection of fact patterns that could help investigate coverage and aid in defending against future lawsuits for UM/UIM benefits.
Mecosta County Medical Center, et al. v. Metropolitan Group Property and Casualty Insurance Company, et al., published opinion of the Michigan Supreme Court issued June 10, 2022 (Docket No. 161628)
Jacob Meyers was injured in a car accident, receiving treatment for those injuries from the plaintiff, Mecosta County Medical Center. Meyers executed an assignment of benefits to the medical center, thereby transferring any right he had to pursue recovery of any incurred expenses to the plaintiff, otherwise granting the plaintiff the right to collect those expenses as Personal Injury Protection (PIP) benefits from the applicable insurance company.
Following execution of the assignment of benefits, Meyers filed a lawsuit in Wayne County Circuit Court for PIP benefits against multiple insurance companies. Pursuant to its assignment of benefits, Mecosta also filed a lawsuit for PIP benefits against the same insurance companies, but in Kent County Circuit Court. Although the same insurance companies were defendants in both cases, Meyers was not a party in the plaintiff’s case, and the plaintiff was not a party in Meyers’ case.
Meyers’ case was ultimately dismissed by the Wayne County Circuit Court. Meanwhile, the plaintiff’s case was still pending. Defendant sought dismissal of the plaintiff’s lawsuit, arguing that the plaintiff was bound by the dismissal of Meyers’ case, its assignor, under theories of res judicata and collateral estoppel.
Res judicata bars a second action on the same claim if: (1) the prior action was decided on the merits, (2) both actions involve the same parties or their privies, and (3) the matter in the second case was, or could have been, resolved in the first. Similarly, collateral estoppel bars the re-litigation of a specific issue within an action when: (1) a question of fact essential to the judgment was litigated and determined by a valid and final judgment, (2) the parties or privies had a full and fair opportunity to litigate the issue, and (3) there is mutuality of estoppel. Thus, both res judicata and collateral estoppel apply only when the parties in the subsequent action were parties or privies of parties to the original action.
Because the plaintiff was not a party in Meyers’ case, res judicata and collateral estoppel would only apply if the plaintiff was a privy of Meyers with respect to the dismissal entered by the Wayne County Circuit Court in Meyers’ case, which entered after Meyers’ executed the assignment of benefits in favor of the plaintiff.
A party is in privity with another party when the later litigant represents the same legal rights as the first litigant asserted (i.e. if Meyers and the plaintiff have mutual or successive relationships to the same interest and right of property or when there is such an identification of interests as to represent the same legal right). And generally, a relationship between two parties based on an assignment of benefits is deemed to be one of privity.
Upon assignment, the assignee (the plaintiff provider) takes whatever rights, privileges, obligations, etc. were held by the assignor (Meyers) at the time of the assignment. But the legal effect of an assignment will not give rise to privity with regard to subsequent actions by or against the assignor (Meyers). For instance, had the Wayne County Circuit Court dismissed Meyers’ lawsuit and Meyers’ later executed the assignment of benefits to the plaintiff, Meyers and the plaintiff would remain in privity with respect to the prior dismissal.
However, a judgment against the assignor (Meyers) entered after the assignment of benefits does not bind the assignee (the plaintiff) because the assignee and assignor were no longer in privy with the judgment entered. As such, the defendant could not rely upon theories of res judicata or collateral estoppel to obtain dismissal of the plaintiff’s lawsuit following and based on the dismissal of Meyers’ lawsuit because the assignment of benefits was executed before Meyers’ lawsuit was dismissed, at which point their rights were no longer in privy with one another.
Emily Zeliasko v Abdulkareem M Al-Dorough, et al., unpublished opinion per curiam of the Michigan Court of Appeals issued June 16, 2022 (Docket No. 357397)
The trial court’s order granting the defendant’s motion for summary disposition, arguing that the plaintiff did not sustain a “serious impairment of body function” in the accident, was reversed by the Michigan Court of Appeals, which ruled:
An objectively manifested impairment of an important body function under MCL 500.3135 need only affect some aspect of the person’s ability to lead her normal life. There is no temporal or quantitative minimum as to the percentage of the persons normal life that must be affected, or for how long. Nor is there requirement of significant changes before and after the accident, so long as there are some changes.
In order to establish a claim for “serious impairment of body function” under MCL 500.3135, the plaintiff must demonstrate: (1) “an objectively manifested impairment,” meaning observable or perceivable from actual symptoms or conditions, (2) “of an important body function,” meaning a body function of value, significance, or consequence to the injured person, (3) “that affects her ability to lead her normal life,” meaning influences some of the person’s capacity to live her normal manner of living.
Although the plaintiff submitted medical records revealing various complaints and treatment following the accident, none of those records specifically state that the accident was responsible. However, the appellate court indicated that “all reasonable inferences must be drawn in the light most favorable to the non-moving party,” in this case – the plaintiff. As such, the appellate court determined that the jury could reasonably conclude that the reported injuries were related to the accident because the symptoms arose immediately following the accident.
Still, the trial court determined that there was objective evidence that the plaintiff sustained other injuries in the accident. However, the trial court also determined that those injuries were not so significant as to constitute a “serious impairment of body function.”
This case ultimately turned on the final prong in MCL 500.3135 analysis (i.e., whether an objectively manifested impairment of an important body function affected Plaintiff’s ability to lead her normal life). This requires a subjective, case-by-case analysis. Determining the affect or influence the impairment has had on a person’s ability to lead her normal life necessarily requires a comparison of her life before and after the accident. Inasmuch, the persons general ability to lead her normal life need not be destroyed, but merely affected. There is no temporal or quantitative minimum as to the percentage of the persons normal life that must be affected, or for how long. Nor is there requirement of significant changes before and after the accident, so long as there are some changes.
Accordingly, the appellate court reversed the trial court’s order for summary disposition in favor of the defendant because the evidence presented by the plaintiff (medical records and deposition testimony) demonstrate her ability to lead her normal life following the accident was affected by her objectively manifested impairment of serious body function sustain in the accident (i.e., difficulty completing tasks at work, inability to drive long distances, missed family vacations, unable to perform household chores, pain while playing sports, etc.).
Antoinette Pellegrino v. State Farm Mutual Automobile Insurance Company, et al., unpublished opinion per curiam of the Michigan Court of Appeals issued June 16, 2022 (Docket No. 355805)
In this case, evidence of claims handling was deemed irrelevant for purposes of determining whether the plaintiff suffered accidental bodily injury under MCL 500.3105 and whether the plaintiff was entitled to allowable expenses under MCL 500.3107(1)(a).
Following a no cause jury verdict in favor of the defendant (State Farm), the plaintiff appealed the trial court’s order granting State Farm’s motion in limine to preclude evidence or, or reference to, its handling of the plaintiff’s Personal Injury Protection (PIP) claims as evidence at trial. Specifically, the plaintiff argued that the trial court abused its discretion by excluding evidence of claims handling because it was relevant to: (1) whether the plaintiff suffered accidental bodily injury under MCL 500.3105, (2) whether State Farm should have paid PIP benefits for allowable expenses under MCL 500.3107(1)(a), and (3) whether State Farm unreasonably delayed or refused to pay her claims.
In affirming the trial court’s decision, the appellate court agreed that evidence of State Farm’s claims handling would not have a tendency to make it more or less probable whether the plaintiff suffered accidental bodily injury (i.e., claims handling was not relevant under MRE 401). Similar, evidence of claims handling would not tend to show that the plaintiff incurred reasonable charges for reasonably necessary products or services in furtherance of her care, recovery, or rehabilitation from those accidental bodily injuries.
Finally, to the extent that evidence of claims handling would have shed light on whether
State Farm unreasonably delayed or refused to pay claims, such determination is to be made by the trial court in deciding whether to impose statutory interest or attorney fees, a decision to be made by the trial court (not the jury) after the trial.
While claims handling is not directly relevant to the plaintiff’s claim for PIP benefits (and her burdens of proof under MCL 500.315 and 3107), it has been held in other cases to be relevant to whether a PIP insurer fairly processed a plaintiff’s claim for PIP benefits when such was a key issue to the plaintiff’s theory of the case (i.e., MCL 500.3142). However, in this case, the jury was instructed that the plaintiff would be entitled to interest if benefits were found to be overdue, as well as having been instructed that the plaintiff bore the initial burden of proof to establish the prerequisites under MCL 500.315 and 3107. And because the jury returned a no cause verdict in favor of State Farm, the issue of interest was never reached, such that any error in excluding evidence of claims handling was harmless.
Bronson Health Care Group, Inc. v. Falls Lake National Insurance Company and MAIPF, unpublished opinion of the Michigan Court of Appeals, issued June 23, 2022 (Docket No. 356319)
This matter involves the cancellation of an insurance policy and notice requirement. The trial court held that Falls Lake’s purported notice of cancellation was not valid under Yang v Everest Ins Co because the notice was sent before the premium payment was due.
Falls Lake conceded this was non-compliant in its appeal, but further argued that the policyholder impliedly assented to cancellation of the policy by cashing the issued refund check. However, there was no evidence presented regarding his state of mind or understanding in cashing the check; and therefore, there was no clear and convincing evidence establishing the policyholder’s agreement to the cancellation of the policy. Accordingly, the Michigan Court of Appeals upheld the trial court’s decision granting summary disposition in favor of Falls Lake based on the policy cancellation.
Bronson had also been awarded summary disposition on its damages claim. In its motion, Bronson cited billing forms and medical records provided, as well as deposition testimony from the Falls Lake representative that the sole basis for the denial of the claim was the cancelled policy, that Bronson’s charges had not been “investigated,” and that he had no reason to believe Bronson’s charges were unreasonable. In response, Falls Lake argued Bronson did not set forth evidence establishing that its charges were reasonable, but did not set forth any evidence or argument as to how or why any of Bronson’s charges were unreasonable. The appellate court upheld the trial court's granting of Bronson’s summary disposition as to its charges.
As such, the appellate court also upheld granting of summary disposition as to the Michigan Auto Insurance Placement Facility (MAIPF), and the awarding of attorney fees to Bronson from Falls Lake.
Alexus Greiwe v. Gage Franklin Hamilton and Michael Glenn Hamilton, and Meemic Insurance Company, unpublished opinion of the Michigan Court of Appeals, issued June 23, 2022 (Docket No. 357124)
This matter involves a claim for Underinsured Motorist (UIM) coverage from defendant, Meemic. The Meemic policy provided $500,000 in underinsured motorist coverage. The at fault driver, Hamilton, maintained $500,000 in bodily injury coverage as well through Farm Bureau.
The plaintiff was one of several injured occupants in Hamilton’s vehicle. As such, the plaintiff was only able to recover $280,000 as the remainder of the policy limit was split among the other occupants. Meemic moved for summary disposition, arguing that Hamilton’s vehicle was not an “underinsured motor vehicle” as defined by its policy. The plaintiff argued that Meemic was responsible for the difference from what she recovered from Hamilton’s insurer up to the Meemic policy limit, a $220,000.00 exposure for Meemic. The trial court denied Meemic’s motion and ruled that Meemic was liable to the plaintiff “for the excess over any insurance proceeds recovered from the underlying Farm Bureau policy, in this case – $220,000.” However, the Michigan Court of Appeals noted there is no statutory mandate for UIM coverage and must rely solely on interpretation of Meemic’s policy. The appellate court found no ambiguity in the Meemic policy, holding that as both the Meemic and Farm Bureau’s policies had identical liability limits, the Hamilton vehicle did not meet Meemic’s policy definition of an underinsured vehicle. Accordingly, the amount of recovery was not relevant to whether there was UIM coverage under Meemic’s policy, and the trial court was reversed.
Dirina Kodra v. American Select Insurance Company and Katherine Allcock and Patrick Robert Lellos, unpublished opinion per curiam of the Michigan Court of Appeals, issued June 23, 2022 (Docket No. 356166)
This matter involves rescission based on fraudulent misrepresentations made by the plaintiff on the application for insurance through American Select.
The parties did not dispute that at the time of application for the insurance policy, the listed Ford Escape was actually co-owned by the plaintiff and her then-fiancé, Dannelly Smith, with whom she resided. Shortly after the policy was issued, the Ford Escape was removed from the policy, and a Chrysler 200 was added the plaintiff again did not disclose that the Chrysler was co-leased by Smith.
The plaintiff was then involved in an auto accident and made a claim for Personal Injury Protection (PIP) benefits through American Select. In investigating the claim, American Select discovered the Chrysler was co-leased by Smith, as was the Ford Escape, and American Select consequently rescinded the policy because of the plaintiff’s failure to disclose that Smith was the co-owner of the Escape and co-lessee of the Chrysler; that Smith was a member of the plaintiff’s household; and that Smith’s license had been suspended indefinitely.
The plaintiff sued American Select for non-payment of PIP benefits, and American Select filed a counter-complaint for fraudulent misrepresentation, innocent misrepresentation, and silent fraud, and subsequently filed a motion for summary disposition, In support, American Select presented the fraud provision of the policy, the plaintiff’s affirmations on the application that the listed vehicles were not co-owned by an undisclosed person, and her deposition testimony that she knew the statement was false when it was made, and a letter from its master underwriter that had the withheld information pertaining to Smith had been disclosed, it would not have issued the policy.
The trial court did not consider the contents of the letter as hearsay, and denied American Select’s motion, finding that the misrepresentations were not material. The Michigan Court of Appeals reversed and opined that the letter should have been considered because the master underwriter could have testified at trial regarding the substance of his letter, and found that rescission was an appropriate remedy due to the fraud related to the procurement of the policy. Further, American Select was not required to demonstrate the plaintiff’s misrepresentations were causally connected to the loss to demonstrate materiality.
Jamil Barash and Euphrates Physical Therapy and Rehab, Inc. v. Joseph J. Kolar and Dilisio Contracting, Inc. and Safeco Insurance Company, unpublished opinion per curiam of the Michigan Court of Appeals, issued June 23, 2022 (Docket No. 357578)
This is a third-party automobile negligence action in which the plaintiff appealed as of right, challenging the trial court’s order that granted summary disposition to DiLisio Contracting. Kolar premised the defense on the conclusion that the plaintiff did not suffer a serious impairment of body function.
DiLisio Contracting and Kolar relied on the plaintiff’s medical records which revealed that he suffered from extensive medical complaints dating back to the early 1990s, and the plaintiff reported the same complaints to his shoulder, back, neck and knees following the accident. Treatments that he received prior to the accident, such as physical therapy, were also administered after the accident. However, although some of the medical reports reflected that the plaintiff reported his involvement in a pedestrian vehicular accident, there was no commensurate determination by the treating physicians that the condition the plaintiff experienced was caused by or preexisting and aggravated as a result of the accident.
That is, plaintiff failed to present medical evidence to support the exacerbation of preexisting conditions.
In contrast, the defendants submitted three IMEs all indicating the plaintiff’s impairments were not the result of the accident, but of degenerative diseases. The plaintiff submitted imaging test results taken three years after the accident occurred and after plaintiff suffered additional falls and injuries, ignoring passage of time and intervening events potential impact on injuries and causation.
The Michigan Court of Appeals determined that the plaintiff failed to present documentary evidence to support that his medical conditions or the aggravation of existing medical conditions was caused by the ownership, maintenance or use of a motor vehicle as opposed to degeneration caused by the aging process and affirmed the trial court’s ruling
Hana Al-Maliky v. Citizens Insurance Company of the Midwest and Mohamed Amine Zreik, unpublished opinion per curiam of the Michigan Court of Appeals, issued June 23, 2022 (Docket No. 356051)
This is a first- and third-party No-fault action that was dismissed without prejudice in favor of Citizens Insurance Company.
At the time of the accident, the plaintiff was driving an uninsured 2013 Chrysler 200. The plaintiff then reported the accident to Citizens, the insurer of her other vehicles. Citizens denied the plaintiff’s claim for Personal Injury Protection (PIP) benefits because she failed to maintain insurance for the involved Chrysler 200.
In support, Citizens produced transcripts of two interviews between the plaintiff and its claims specialists wherein the plaintiff admitted she was the sole-titled owner of that vehicle, decided not to insure it, and knew that it was uninsured when driving it at the time of the accident. The plaintiff responded that the interview transcripts were hearsay evidence and impermissibly relied upon by the trial court. However, the trial court correctly determined that the statements in the transcripts were non-hearsay because they constituted admissions by a party opponent pursuant to MRE 801(d)(2). Therefore, the plaintiff was not entitled to PIP benefits under MCL 500.3113(b).
Kaitlin M. Gant is a member of Plunkett Cooney's Transportation Law Practice Group. She focuses her practice in the areas of motor vehicle negligence and Michigan's No-Fault Law.
A member of the firm's Detroit office, Ms. Gant ...
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