Michigan Court of Appeals; Docket # 344194; Unpublished
Judges Murray, Meter, and Fort Hood; Per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Obligation of the Assigned Claims Facility to Make an Initial Determination of Claimant’s Eligibility (§500.3173a)
TOPICAL INDEXING:
Not Applicable
SUMMARY:
In this unanimous unpublished per curiam decision, the Court of Appeals affirmed the trial court’s summary disposition order dismissing the plaintiff’s first-party action to recover no-fault PIP benefits against the Michigan Automobile Insurance Placement Facility. The plaintiff, Brentis Sutton, failed to undergo an examination under oath after being ordered to do so by the MAIPF, and as a result, the MAIPF refused to assign his claim. The Court of Appeals held that the MAIPF is allowed to investigate a claim before making an initial determination as to a claimant’s eligibility for benefits, and that if a claimant does not comply with the MAIPF’s investigation, the MAIPF can refuse to assign his or her claim.
Brentis Sutton was the sole occupant of a vehicle owned by his father when he was involved in a motor vehicle collision and injured. He was uninsured at the time of the collision, and thus filed an application for no-fault PIP benefits with the MAIPF. The MAIPF sent a letter in response to Sutton’s application, informing him that it would need additional information before making an initial determination as to his eligibility for benefits. The MAIPF sent another letter to Sutton months later, informing him that he would need to submit to an EUO before an eligibility determination could be made. In lieu of appearing for the EUO, Sutton filed the present complaint against the MAIPF.
There were several defects with Sutton’s complaint, not least of which was the fact that he apparently misunderstood the MAIPF’s statutory function, and stated that he was seeking no-fault PIP benefits directly from the MAIPF. He also asserted that the MAIPF was only statutorily entitled to make an initial determination as to a claimant’s eligibility for benefits, and then either assign the claim to an insurer or deny the claim. By conducting a preliminary investigation and insisting that Sutton undergo an EUO, Sutton argued that the MAIPF was exceeding its statutory mandate. The trial court disagreed, and granted the MAIPF’s motion for summary disposition, dismissing Sutton’s complaint with prejudice.
The Court of Appeals determined, firstly, that the trial court could have granted summary disposition pursuant to MCR 2.116(C)(8), alone, because Sutton mistakenly treated the MAIPF as a no-fault insurer in his complaint, and sought recovery of no-fault PIP benefits directly from the MAIPF. The “actual issue” on appeal, however, was “whether and to what extent [the MAIPF] is entitled to investigate claims made under the MACP before making its initial determination and either denying or assigning those claims to a servicing insurer.” The Court then described each party’s arguments as follows:
Plaintiff contends that his complaint was justified because defendant was statutorily obligated to promptly assign or deny his application for PIP benefits and failed to do so, whereas defendant contends that it was entitled to make a reasonable investigation before making an initial determination and plaintiff was required to reasonably cooperate with that investigation.
The Court of Appeals agreed with the MAIPF’s argument, holding that nothing in [either MCL 500.3173a(1) or MCL 500.3174] suggests that [the MAIPF] is prohibited from making any investigation whatsoever on the initial determination.” Interestingly, as the Court points out, had the subject collision occurred later than it did, Sutton’s argument regarding the MAIPF’s investigative ability could be even more easily disposed of, by MCL 500.3173a(2). MCL 500.3173a(2) now reads:
A claimant or a person making a claim through or on behalf of a claimant shall cooperate with the Michigan automobile insurance placement facility in its determination of eligibility and the settlement or defense of any claim or suit, including, but not limited to, submitting to an examination under oath. . . . [Emphasis added.]
Sutton argued that dismissal was an extreme and unnecessary sanction for a discovery violation. The Court of Appeals disagreed, noting that Sutton’s characterization of the trial court’s dismissal of his case as a “sanction” was not accurate. Rather, the trial court dismissed his case because it lacked merit. Moreover, even if the trial court had erred by dismissing Sutton’s complaint based solely on a discovery violation, the Court of Appeals determined that such an error would not have affected Sutton’s substantial rights, and was not outcome-determinative—“viewing the facts in a light most favorable to plaintiff, plaintiff simply did not have an actionable claim against defendant.”
