Michigan Court of Appeals; Docket # 342067; Unpublished
Judges O’Brien, Jansen, and Ronayne Krause; per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
§500.3143 General/Miscellaneous
TOPICAL INDEXING:
Medical Provider Standing (Post-Covenant)
SUMMARY:
In this unanimous unpublished per curiam decision, the Court of Appeals reversed the trial court’s grant of summary disposition for defendant State Farm Mutual Automobile Insurance Company (“State Farm”) on the issue of assignment of rights. The Court held: (1) that an anti-assignment clause in State Farm’s policy was unenforceable; (2) that the assignment of rights obtained by Omega Rehab Services, LLC (“Omega”) was therefore valid; and (3) that the trial court erred in denying Omega’s motion to amend its complaint, which was actually a motion to file a supplemental pleading.
This case arises out of injuries sustained by State Farm’s insured, Tom Georgis, who sought to assign his right to PIP benefits to his treatment provider, Omega. Omega obtained an assignment from Georgis, and moved to file a supplemental pleading to reflect that assignment. State Farm moved for summary disposition, based on the anti-assignment clause in Georgis’ policy. The trial court granted State Farm’s motion, and denied Georgis’ motion to amend his complaint, precisely because of the anti-assignment clause.
The Court of Appeals reversed, finding firstly that anti-assignment clauses such as the one in the present case are unenforceable. This anti-assignment clause was “identical” to the one in Shah, in which the court determined that such clauses violate public policy. In reaching this conclusion, the Court reasoned:
In Shah, this Court held that “the antiassignment clause in the instant case is unenforceable to prohibit the assignment that occurred here – an assignment after the loss occurred of any accrued claim to payment – because such a prohibition of assignment violates Michigan public policy[.]” Id. at 200. Accordingly, the antiassignment clause here is also unenforceable due to public policy. Georgis accrued a claim against -4- defendant, his insurer, for “payment of health care services that had already been provided by plaintiff[ ].” Id. Because this accrued claim existed “before [Georgis] executed the assignment,” he was free to assign his claim to plaintiff. Id. Accordingly, the trial court erroneously granted summary disposition in favor of defendant on the basis that the antiassignment provision was enforceable.
Secondly, the Court determined that the assignment obtained by Omega was, therefore, valid: “Because this accrued claim existed ‘before [Georgis] executed the assignment,’ he was free to assign his claim to plaintiff.”
And thirdly, the Court of Appeals reasoned that the plaintiff’s motion to amend its complaint was actually a motion to file a supplement pleading. Insofar as it was denied because the trial court deemed the anti-assignment clause to be enforceable, it, too, had to be reconsidered. Thus, the Court reversed and remanded for further proceedings.
