Michigan Court of Appeals; Docket No. 133980; Unpublished
Judges Fitzgerald, Weaver, and Marilyn Kelly; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Standards for Deductibility of State and Federal Governmental Benefits [§3109(1)]
Social Security Disability Benefits [§3109(1)]
TOPICAL INDEXING:
Social Security Disability and Death Benefits
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion, the Court of Appeals held that it was improper for the trial court to rule by summary disposition that American Fellowship was not entitled to a Social Security disability benefit setoff from plaintiffs wage loss benefits, where plaintiff had failed to apply for or receive such Social Security benefits.
Plaintiff sustained a severe head injury in an automobile accident in 1984. She was comatose throughout the first three years following the accident American Fellowship paid wage loss benefitsJo plaintiff, but when plaintiff commenced an action for additional unpaid no-fault benefits, American Fellowship counter-claimed seeking entitlement to a setoff of Social Security disability benefits. The trial court granted plaintiffs motion for summary disposition on defendant's entitlement to a set-off on the basis that plaintiff had never actually received Social Security disability benefits.
In reversing, the Court of Appeals held that Social Security disability benefits actually received must be subtracted from no-fault work loss benefits, regardless of whether the benefits were paid to an injured party or to the party's dependent. Further, such benefits can be setoff, even where they have not been paid, if the non-payment was occasioned by the injured person's failure to reasonably seek the benefits. The court relied upon its decision in Grau v DAIIE, 148 Mich App 82 (1985).
The court held that under §3109(1), the injured party is required to submit a request for payment from the governmental agency. (In this case, application for the Social Security disability benefits did not occur until more than two years after the expiration of the three statutory period for wage loss benefits. Social Security disability benefits were received, but retroactive only to January 1988, not including any time period for which wage loss benefits were received.)
The court went on to hold, however, that the no-fault insurer has the burden of establishing that, had the injured parry applied for the benefits, they would have been paid or payable. In this case, plaintiff failed to show that reasonable efforts were used to obtain Social Security disability benefits for the years in question. The Court of Appeals, therefore, reversed and remanded with instruction that the defendant is entitled to a setoff only if it proves that the Social Security disability benefits would have been paid or payable if applied for.