Michigan Court of Appeals; Docket # 339983; Unpublished
Judges Jansen, Meter, and Gleicher; per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Assignments of Benefits—Validity and Enforceability
SUMMARY:
In this unanimous unpublished per curiam decision regarding assignments of rights, the Court of Appeals reversed the trial court’s grant of the Plaintiff’s motion for leave to amend its complaint and denial of the Defendant’s partial motion for summary disposition because the Plaintiff’s amended complaint was actually a supplemental pleading, which did not relate back to the original filing date. Therefore, the Plaintiff was barred by the one-year-back rule from recovering certain losses.
Plaintiff provided attendant care services to two patients injured in a motor vehicle accident and sought payment from Defendant Allstate for those services. Pursuant to the Supreme Court’s decision in Covenant, Plaintiff obtained assignments of rights from its patients, and sought to leave to amend its complaint and “relate back its claims to the date of the original complaint.” Allstate moved for partial summary disposition, arguing that the Plaintiff’s amended complaint was actually a supplemental pleading and that its claims did not relate back to the original filing date. The trial court granted Plaintiff’s motion for leave to amend its complaint, and denied Allstate’s motion for partial summary disposition.
The Court of Appeals reversed, first determining that the Court’s prior ruling in Shah dictated that Plaintiff’s amended complaint actually be considered a supplemental pleading, in which case the relation-back doctrine does not apply. The Court reasoned:
This Court’s decision in Shah, controls the outcome of this case. Plaintiff originally filed a lawsuit against defendant on April 6, 2016, seeking recovery for the services plaintiff provided to Gorgees and Hubi, who were both insured by defendant, for injuries they suffered in the March 29, 2014 motor vehicle accident. After Covenant, plaintiff no longer possessed an independent ground for recovering for the losses plaintiff incurred. However, plaintiff obtained assignments of rights from Gorgees and Hubi on June 8, 2017. Gorgees assigned to plaintiff her rights to collect PIP benefits for case management and attendant care services plaintiff provided to her from April 15, 2014 through June 8, 2017. Hubi assigned to plaintiff his rights to collect PIP benefits for case management services plaintiff provided to him from April 15, 2014 through June 8, 2017, and his rights to collect PIP benefits for attendant care services plaintiff provided to him from April 15, 2014 through May 15, 2017.
However, because Shah states that these assignments constitute “an event that occurred after the filing of the original complaint and provided the only means by which plaintiff[] could have standing to maintain a direct action against defendant insurer for recovery of no-fault benefits,” Shah, 324 Mich App at 204-205, plaintiff’s motion for leave to amend its complaint was actually a request to file a supplemental pleading, id. at 204 (“Courts are not bound by a party’s choice of labels because this would effectively elevate form over substance.”) (quotation marks and citation omitted). Therefore, plaintiff’s June 19, 2017 filing was a supplemental pleading, and the relation-back doctrine does not apply. Id. at 204-205, citing MCR 2.118(D) and (E).2 The trial court’s misapplication of MCR 2.118 constitutes an error of law, and thus, an abuse of discretion. See Shah, 324 Mich App at 204-208.
Next, the Court determined that, because the amended complaint was actually a supplemental pleading and did not, therefore, relate back to the date of the original complaint, that Plaintiff was barred by the one-year-back rule from recovering for certain losses. The Court explained:
The trial court held that plaintiff’s claims under an assignment-of-rights theory were not barred by the one-year-back rule, and determined that the correct date for purposes of the one-year-back rule was April 6, 2016 (the date plaintiff filed its original complaint). This was erroneous. As this Court stated in Shah, 324 Mich App at 205, the pertinent date for purposes of the one-year-back rule is the date plaintiff acquired the assignments of rights from Gorgees and Hubi—i.e., June 8, 2017. Therefore, plaintiff may only recover for losses incurred on or after June 8, 2016—one year before plaintiff obtained the assignments of rights from Gorgees and Hubi. See id. All of plaintiff’s claims for losses incurred before June 8, 2016, are barred by the one-year-back rule.
