Michigan Court of Appeals; Docket #355220; Unpublished
Judges O’Brien, Shapiro, and Boonstra; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Equitable Estoppel
Evidentiary Issues
SUMMARY:
In this unanimous, unpublished, per curiam decision, the Court of Appeals affirmed the trial court’s summary disposition order dismissing Plaintiff Archangel Physical Therapy, LLC’s (“Archangel”) first-party action against Defendant State Farm Mutual Automobile Insurance Company (“State Farm”). The Court of Appeals held that Archangel failed to present any evidence in support of its claim that State Farm engaged in pre-suit negotiations in bad faith, with the intention of forestalling Archangel from filing its complaint until more than one year passed from the date Archangel last rendered treatment to State Farm’s insured. As a result, the Court dismissed Archangel’s argument that State Farm should be equitably estopped from invoking the one-year back rule as a defense against Archangel’s claims.
Rafaa Yahia was injured in a motor vehicle collision on January 11, 2018, and she received treatment from Archangel from January 29, 2018 to October 11, 2018. On September 10, 2018, Yahia filed a first-party action against State Farm, and on June 20, 2019, Archangel—who was not a party to Yahia’s action—filed a notice of lien and requested to receive information regarding case evaluation in Yahia’s case. On June 21, 2019, Archangel’s counsel spoke directly with State Farm’s counsel and emailed Yahia’s counsel, informing Yahia’s counsel that he (Archangel’s counsel) “ ‘[would] be negotiating directly with the defense attorney . . . in hopes of amicably resolving this matter.’ ” Yahia’s action proceeded to case evaluation, after which both Yahia and State Farm accepted the case evaluation award and stipulated to dismiss the case. On November 11, 2019, Archangel moved to reopen Yahia’s action, but the trial court would not let it do so, as it was never named as a party. Archangel then filed its own action against State Farm, on November 27, 2019, seeking to recover PIP benefits related to the treatment it rendered to Yahia from January 2018 to October 2018. State Farm moved for summary disposition based on the one-year-back rule, while Archangel argued, in response, that State Farm should be equitably estopped from invoking the one-year-back rule because it induced Archangel to delay in filing its lawsuit. The trial court agreed with State Farm and granted its motion.
The Court of Appeals affirmed the trial court’s summary disposition order in favor of State Farm, holding that Archangel failed to present sufficient evidence to create a question of fact as to whether State Farm induced it to delay in filing its complaint. Archangel argued that State Farm’s conduct leading up to case evaluation in Yahia’s case was “designed to delay Archangel from commencing a lawsuit against State Farm.” In support of this argument, Archangel adduced phone records that showed that its counsel spoke with State Farm’s counsel on June 21, 2019; Archangel’s email to Yahia’s counsel confirming that he would be negotiating directly with State Farm’s counsel in the hopes of amicably resolving Archangel’s claims; and an email from State Farm’s counsel to Archangel’s counsel, dated July 2, 2019, in which State Farm’s counsel directed Archangel’s counsel to call him. The Court determined noted that none of this evidenced any representation from State Farm to Archangel intended to delay Archangel from filing suit, however. Moreover, there was no evidence that Archangel justifiably relied on any representation by State Farm in delaying filing suit.
“Archangel argues that State Farm’s conduct was designed to delay Archangel from commencing a lawsuit against State Farm. However, even when viewed in a light most favorable to Archangel, the evidence is insufficient to create a genuine issue of material fact on that matter. Archangel first relies on phone records indicating that its counsel and State Farm’s counsel spoke on June 21, 2019, a day after the lien was filed. But there is no evidence in the record as to the substance of this conversation. Next, Archangel points to the June 21, 2019 e-mail correspondence in which its counsel informs Yahia’s counsel that he spoke to State Farm’s attorney and that he ‘will be negotiating directly with the defense attorney . . . in hopes of amicably resolving this matter.’ This does not show a promise by State Farm to settle Archangel’s claims, but at most shows an agreement ‘to work toward an amicable solution,’ which, as the trial court reasoned, ‘does not rise to the level of conduct intended to induce one party’s justifiable reliance in refraining from filing a lawsuit.’ The only e-mail Archangel provided between Archangel and State Farm was sent on July 2, 2019, in which State Farm’s attorney stated, ‘You filed the lien[,]’ and directed Archangel’s counsel to call him. While Archangel claims that the parties discussed settling its claims, it has not provided evidence regarding the substance of that phone conversation.
Archangel argues that the revised case evaluation summary in Yahia’s action excluding its bills shows that the parties agreed to negotiate those claims. ‘Negotiations intended to forestall bringing an action have been considered an inducement sufficient to invoke the doctrine[.]’ Cincinnati Ins Co, 454 Mich at 270. In Cincinnati Ins Co, the defendant insurer informed the plaintiff insurer that it would only evaluate the plaintiff’s subrogation claim once it had the documentation for the entire loss because it did not want to ‘handle the claim piecemeal.’ Id. at 266. The plaintiff relied on the defendant’s representations and agreed to deferred payment for several months, but the defendant eventually stated that it would not pay the claim because the one-year statute of limitations, MCL 500.3145(2), had expired. Id. at 267. The Supreme Court determined that, because the plaintiff acted in good faith at the direction of the defendant for the convenience of the defendant, the defendant was estopped from asserting the statute of limitations as a defense. Id. at 271-272.
In contrast to Cincinnati Ins Co, there is no evidence that State Farm made assurances that it would pay or settle Archangel’s claims or that State Farm induced Archangel to delay filing suit. Indeed, there is no evidence of contact between State Farm and Archangel before June 21, 2019. Thus, Archangel’s decision to not file an action for reimbursement before that time cannot be attributable to any representation by State Farm. Further, the last communication between the parties, according to the record evidence, was on July 2, 2019. At this point, Archangel still had three months to bring suit and seek recovery for some of its outstanding bills. Considering the sparse communications between the parties over the course of two weeks, it cannot be said that State Farm prevented Archangel from commencing an action within the recovery period of MCL 500.3145(1).
In sum, Archangel fails to establish a genuine issue of material fact that State Farm made representations intended to delay Archangel from filing suit or that Archangel justifiably relied on any representation by State Farm. Accordingly, the trial court did not err by denying Archangel’s claim of estoppel and granting summary disposition to State Farm on the basis of the one-year back rule.”
Also based on the evidence, the Court of Appeals held that Archangel failed to create a question of fact as to whether State Farm induced it to withdraw its claims from case evaluation.
For the reasons already discussed, there is scant record evidence to conclude that State Farm induced Archangel to exclude its bills from Yahia’s case evaluation. There is only one communication from State Farm to Archangel in the record. In the July 2, 2019 e-mail, State Farm’s attorney merely acknowledges Archangel’s lien and directs Archangel’s counsel to call him. Further, this e-mail was sent after case evaluation occurred on June 24, 2019. Thus, the e-mail does not support Archangel’s position that State Farm intended to induce Archangel to exclude its claims from Yahia’s case evaluation.
Despite Archangel’s arguments to the contrary, the pertinent question before us is whether State Farm induced Archangel to not bring a timely suit. Again, State Farm sought summary disposition on the basis of the one-year back rule. To invoke estoppel in this context, Archangel must show that State Farm induced it to refrain from bringing a timely action. See Cincinnati Ins Co, 454 Mich at 270; Bohlinger, 120 Mich App at 274-275. Even if the trial court had agreed that estoppel could arise from communications regarding Archangel’s decision to take its claims out of the insured’s suit, there is, as reviewed, no evidence establishing a question of fact that State Farm intended to induce Archangel into doing so. And the trial court did not err by concluding that the motion for reconsideration failed to raise an issue that had not already decided by the court in its initial ruling granting summary disposition. See MCR 2.119(F)(3).
