Michigan Court of Appeals; Docket # 332597; Unpublished
Judges Gleicher, M.J. Kelly and Shapiro; Unanimous, Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Governmental Benefits Subtraction; PIP Deductibles: Social Security Disability Benefits [§3109(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion, the Court of Appeals held the trial court properly granted plaintiff-Liberty Mutual summary disposition on its reimbursement claim against defendant-insured, after defendant received both no-fault wage loss benefits and Social Security Disability benefits. However, the Court reversed summary disposition for Liberty Mutual on defendant’s counterclaim, which was based on an alleged failure to pay reasonable and necessary rehabilitation costs, finding that a question of fact existed as to whether the claimed expenses were reasonably necessary.
Defendant sustained a traumatic brain injury in a January 2010 auto accident. His no-fault insurer, Liberty Mutual, paid PIP benefits, including wage loss benefits. Apparently at Liberty Mutual’s urging, defendant applied for Social Security Disability (SSD) benefits and, at some point, he began receiving SSD. The record indicated the Social Security Administration found defendant disabled as of January 30, 2010, and that he was entitled to SSD starting in July 2010. When Liberty Mutual discovered that defendant was receiving SSD, it sent him a letter stating that under MCL 500.3109(1), he was required to reimburse Liberty Mutual $35,501.60. When defendant did not reimburse Liberty Mutual, it filed this lawsuit, seeking the $35,501.60 it had paid defendant in wage loss benefits. In response to Liberty Mutual’s complaint, defendant asserted various affirmative defenses, including that Liberty Mutual’s cause of action was barred by the wrongful conduct rule. Defendant also filed a counterclaim, asserting that Liberty Mutual was liable for breach of contract and unjust enrichment for its failure to pay “reasonable and necessary expenses” related to defendant’s rehabilitation. Liberty Mutual moved for summary disposition, which the trial court granted.
The Court of Appeals affirmed summary disposition for Liberty Mutual on its claim for reimbursement under §3109(1). Defendant asserted the reimbursement action was barred by the wrongful conduct rule because Liberty Mutual made him apply for SSD, even though Liberty Mutual believed he was capable of working.
However, the Court said there was no evidence that Liberty Mutual required defendant to lie on his application for SSD or that there were any false or misleading statements in his actual application. The Court stated:
“[Defendant] appears to contend that because he felt he was able to work and because Liberty Mutual also believed he was able to work (as demonstrated by its efforts to find a job for him), Liberty Mutual knowingly and willfully caused him to lie on his social security disability application and therefore violate 42 USC 1383a. [Defendant], however, has submitted no evidence showing that Liberty Mutual required him to lie on his application, nor has he directed this Court’s attention to any false or misleading statements in his actual application. Although he asserts that discovery is ongoing, if there were false or misleading statements in the application, or if Liberty Mutual required him to make false or misleading statements in his application, then — in an effort to avoid summary disposition —[defendant] could have averred such facts in a supporting affidavit. Therefore, even viewing the record facts in the light most favorable to [defendant], i.e., that Liberty Mutual required him to apply for Social Security Disability benefits even when he thought he was employable, given that there is no actual evidence of fraud in the social security disability application, we conclude that the wrongful-conduct rule does not bar Liberty Mutual’s claim. … In sum, the trial court did not err in granting Liberty Mutual summary disposition on its claims against [defendant].”
Next, the Court of Appeals agreed with defendant’s argument that the trial court erred in dismissing his counterclaim. According to the Court, the trial court found that defendant quit his job as an ER physician two years before the accident and was only working as an ER independent contractor. The trial court said that defendant wanted Liberty Mutual “to go beyond restoring him to a position he was in prior to the accident” because he wanted Liberty Mutual “to pay all related costs to completely retrain him in a career that he abandoned more than two years prior to the accident.” However, the Court of Appeals said the evidence, viewed in a light most favorable to defendant, “plainly” showed that he was employed as an ER physician on the date of the accident, albeit on an independent contractor basis. In addition, the Court said there was record evidence allowing an inference that defendant maintained both his continuing education units and his medical certifications. Accordingly, the Court ruled the trial court erred in granting summary disposition on defendant’s counterclaim.
The Court of Appeals continued by addressing Liberty Mutual’s contention that the claimed expenses were “not for reasonably necessary vocational rehabilitation services, products, or accommodations given that they are merely the costs that any physician would have to pay in order to maintain his or her professional license.” The Court noted that, on the other hand, defendant argued the costs “were for reasonably necessary services, products, or accommodations because the accident prevented him from practicing” as an ER physician and “would continue to do so until he was up-to-date on his CEUs and certifications, and until he had completed a supervised mentorship program.”
Based on the foregoing, the Court of Appeals said that, on the record, it was not prepared to find that all the expenses “were not vocational rehabilitation expenses reasonable and necessary to return him to his preinjury condition. Rather, this is a question better suited to a jury.”
The Court of Appeals concluded:
“[V]iewed in the light most favorable to [defendant], the record shows he was working as an emergency room physician on the date of the accident and that there is a jury question with regard to whether the claimed expenses were reasonably necessary. Accordingly, on the record before us, the trial court erred in granting Liberty Mutual summary disposition on [defendant’s] counterclaim.”
