Michigan Court of Appeals; Docket # 343289; Unpublished
Judges Redford, Markey, and Kelly; per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Actual Fraud
Fraud/Misrepresentation
SUMMARY:
In this unanimous unpublished per curiam opinion, summary disposition for the defendant was AFFIRMED because the trial court correctly concluded that the plaintiff committed fraud in her claims for benefits.
The plaintiff was injured in a motor vehicle collision, and thereafter sued her automobile insurer, Farm Bureau Insurance Company of Michigan, to recover PIP benefits, uninsured motorist benefits, and underinsured motorist benefits. The plaintiff alleged that her injuries severely limited her ability to perform even basic tasks, and that she required 24-hour attendant care, seven days a week, for approximately six months after the collision. Farm Bureau ordered surveillance of the plaintiff to determine the extent of her limitations, and the Court of Appeals summarized the findings from the surveillance as follows:
Farm Bureau investigated plaintiff’s claims and hired an investigator to observe her to determine whether her injuries and limitations were actually as severe as plaintiff claimed. The investigator obtained a surveillance video of plaintiff during November 2015 that showed plaintiff walking, shopping, pushing a grocery cart, getting in and out of a vehicle, holding a open for another person, and carrying a shopping bag, all without any assistance or any apparent need for assistance. The surveillance video also documented plaintiff engaging in similar activities, including driving a vehicle on more than one occasion, pulling garbage cans to the curb multiple times, climbing steps, carrying items in both hands at the same time, and running various errands during December 2015, January 2016, February 2016, and March 2016. The investigator’s report indicated that plaintiff “walked and moved her neck, back, and right leg in a normal manner without any sign of difficulty” while in view, and that plaintiff “did not utilize any noticeable brace or orthopedic device” on November 11, 2015. The investigator reported the same at the conclusion of the surveillance reports for December 2015, January 2016, February 2016, and March 2016. The record also reflects that, at the July 28, 2017 motion hearing, plaintiff’s counsel stated that plaintiff’s need for assistance began to decrease as early as December 2015, thereby contradicting plaintiff’s sworn testimony.
The trial court originally granted only partial summary disposition in Farm Bureau’s favor, finding that the plaintiff committed fraud by claiming benefits for activities she was observed on the surveillance performing on her own. On interlocutory appeal, Farm Bureau sought to reverse the trial court’s order granting only partial summary disposition, which the Court of Appeals granted, remanding the case back to the trial court to complete dismissal under MCR 2.116(C)(10). This appeal arose from the most recent trial court order, dismissing the case in its entirety. However, that appeal was directed by the Court of Appeals; therefore, the law of the case doctrine applies, and the Court of Appeals’ previous order controls as to this appeal as well.
As for the plaintiff’s alleged fraud, the Court of Appeals determined that “reasonable minds could not differ that plaintiff engaged in fraud for the purpose of recovering no-fault benefits” under the standard for fraud established in Bahri v IDS Prop. Casualty Ins. Co., 308 Mich App 420 (2014). The plaintiff was observed on the surveillance performing the same tasks for which she was claiming benefits, and her policy’s fraud provision unambiguously excluded coverage for any insured under the policy who made fraudulent statements or engaged in fraudulent conduct in connection with any loss for which coverage was sought. The Court of Appeals determined that the results of the surveillance constituted such fraudulent conduct, and that the plaintiff’s claims were therefore barred.
In Bahri, the plaintiff was involved in a car accident and sought PIP and uninsured motorist benefits from the defendant insurer. Id. at 421-422. The plaintiff indicated that she required replacement services for a period but the defendant investigated and conducted surveillance that showed the plaintiff “bending, lifting, driving, and running errands.” Id. at 422. The defendant moved for summary disposition, arguing that the plaintiff’s claims were precluded by the fraud provision in the plaintiff’s insurance contract. Id. The insurance contract excluded coverage “for any insured who has made fraudulent statements or engaged in fraudulent conduct in connection with any accident or loss for which coverage is sought under this policy.” Id. at 423-424. This Court agreed with the trial court’s analysis and concluded that the plaintiff “made fraudulent representations for purposes of recovering PIP benefits.” Therefore, it held that no genuine issue of material fact existed and that the trial court did not err by granting summary disposition to the defendant. Id. at 426.
Even when viewed in a light most favorable to plaintiff, the evidence presented the trial court established that plaintiff’s claims for no-fault benefits were based upon fraud and false swearing. Reasonable minds could not differ that plaintiff engaged in fraud for the purpose of recovering no-fault benefits. Bahri, 308 Mich App at 426. Because she did so, Farm Bureau had the contractual right to void the policy and deny her no-fault benefits. The trial court, therefore, did not err by granting summary disposition to Farm Bureau and dismissing plaintiff’s claims with prejudice.
