Michigan Court of Appeals; Docket #359396; Unpublished
Judges Shapiro, Letica, and Feeney; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
Sudden Emergency Doctrine
Uniform Trade Practices Act (UTPA – MCL 500.2001, Et Seq.)
Uninsured Motorist Coverage in General [Uninsured Motorist Benefits]
In this unanimous, unpublished, per curiam decision, the Court of Appeals affirmed the trial court’s ruling in Plaintiffs Jerry Paul and Joanne Paul’s action for uninsured motorist (“UM”) benefits against Defendant Farm Bureau Insurance Company of Michigan (“Farm Bureau”), in which the trial court refused to give the jury an instruction on the sudden emergency doctrine. The Court of Appeals held that, given the absence of any actual evidence that the unidentified driver who crashed into the Pauls actually encountered a sudden emergency, the trial court did not abuse its discretion in refusing to instruct the jury on the sudden emergency doctrine. The Court of Appeals then reversed the trial court’s ruling that the Pauls were not entitled to penalty interest under the Uniform Trade Practices Act (“UTPA”), holding that the trial court erred in determining that UTPA penalty interest was unavailable to the Pauls solely because the Pauls failed to specifically cite to the relevant UTPA statute in their complaint.
Jerry and Joanne Paul were driving home in whiteout conditions when they became involved in a 15-car pileup collision. They were not injured in the initial collision, but a few minutes later, as Jerry was standing outside the vehicle inspecting the damage, another vehicle crashed into the Pauls’ vehicle, which, in turn, struck Jerry and seriously injured him. The driver of the vehicle that crashed into the Pauls’ vehicle was never identified, and thus, after the collision, the Pauls turned to their own insurer, Farm Bureau Insurance Company of Michigan, for UM coverage. Joanne would later testify that, approximately two to three minutes prior to the collision, the whiteout conditions let up and visibility improved. Three police officers who investigated the pileup testified that the whiteout conditions started approximately half a mile from the scene, and that visibility fluctuated during their time at the scene. At trial, both lawyers conceded that if the conditions were the same as they were when the initial pileup occurred, the driver who hit the Pauls could not be found to have acted negligently. There was no actual evidence to rebut Joanne Paul’s testimony regarding the improvement in visibility at the time of the crash, however, and thus, at the close of proofs, the trial court declined to give the jury an instruction on the sudden emergency doctrine. The jury then returned a unanimous verdict in favor of the Pauls, after which the Pauls moved for UTPA penalty interest, which the trial court declined to award because the Pauls did not cite to MCL 500.2006 in their complaint, nor specifically assert a claim for UTPA penalty interest.
The Court of Appeals affirmed the trial court’s decision to not give the jury an instruction on the sudden emergency doctrine. The Court and both lawyers acknowledged at trial that if the driver who crashed into the Pauls faced the same whiteout conditions the Pauls faced when they were involved in the initial pileup, that would constitute a sudden emergency. However, there was no actual evidence to suggest that the driver who crashed into the Pauls was confronted with those whiteout conditions, or to rebut Joanne’s testimony that he wasn’t. Therefore, the trial court did not abuse its discretion in declining to instruct the jury on something that was “entirely speculative.”
“Defendant relies on Smith’s testimony that when visibility approved about three or four minutes after his crash, he was able to see Jerry lying in the roadway. Defendant argues that it can be inferred from this that Jerry was struck during the period of non-visibility that coincided with Smith’s crash. However, as noted with respect to Tobias’s testimony, there was no evidence establishing when Smith’s crash occurred relative to the unidentified driver striking plaintiffs’ vehicle. While it is possible that the unidentified driver faced whiteout conditions before striking plaintiffs’ vehicle, the court concluded that there was insufficient evidence presented for the jury to reach that conclusion without resorting to speculation. The jury may not construct facts out of pure speculation to sustain a particular verdict. See Conley v McDonald, 40 Mich 150, 155-159 (1879).
Equally significant to the trial court’s decision was its determination that it would be entirely speculative for the jury to conclude that the unknown driver acted reasonably even if confronted with severe conditions because there was no evidence of the specific actions taken by that driver. To be clear, there was absolutely no evidence as to the driver’s speed, whether he or she was distracted, whether he or she had been following too closely and whether he or she promptly slowed down upon confronting the poor visibility. In the absence of such evidence, there was no basis for the jury to conclude that the unidentified driver made ‘proper and reasonable use of his senses under the circumstances that had been testimonially described.’ Baker, 374 Mich at 497. Notably, defendant does not identify any caselaw applying the sudden-emergency doctrine where the identity of the striking driver is unknown. It appears that in all the cases cited, the striking driver was available to testify as to the conditions specifically encountered and the actions he or she took.”
The Court further determined that reversal was not warranted because the question of what weather conditions the unknown driver encountered leading up to the crash was sufficiently presented to the jury, such that it was “extraordinarily likely that the jury was aware that both parties attached great significance to the actual weather conditions at the moment of the second collision.”
“The jury was instructed that the determination whether or not the unidentified driver was negligent must be based ‘under the circumstances you find existed . . . in this case.’ A review of the trial transcript reveals that through the entirety of the trial, defendant presented its theory that the unidentified driver should be found not negligent because of the weather. Even plaintiffs’ attorney told the jury that plaintiffs would have no claim if the unidentified driver encountered the same whiteout conditions that they did. Specifically, plaintiffs’ attorney stated in closing argument that ‘if the vehicle that ran into the—the Paul vehicle, the unknown vehicle, was confronted by a whiteout and then ran into [plaintiffs’ vehicle] we wouldn’t be here . . . [t]hat’s not negligence, you can’t avoid that.’ Defendant argues that the jury was free to disregard any statements made by the lawyers regarding defendant’s theory of the case because it was instructed that the lawyers’ arguments are not evidence and that it should base its decisions only on the evidence and the instructions given by the trial court. The question, however, is not whether the lawyers’ statements were construed by the jury as evidence but whether defendant’s theory of the case was adequately presented to the jury. In any event, much of the testimony throughout the case focused on the extent to which visibility conditions differed between the time of the first collision and any time thereafter. It is therefore extraordinarily likely that the jury was aware that both parties attached great significance to the actual weather conditions at the moment of the second collision.”
The Court of Appeals then rejected Defendant’s argument that the trial court’s refusal to give an instruction on the sudden emergency doctrine prejudiced it because the Pauls were relying on a violation of the ‘rear-end’collision statute,’ MCL 257.402, to create a presumption of negligence. The Court observed that the jury’s instruction was that it ‘may infer that the hit and run driver was negligent’ if it found that the unidentified driver violated MCL 257.402. Thus, “the jury understood that the violation of the rear-end collision statute created a rebuttable presumption of negligence and that it was not obligated to find the unidentified driver negligent based on the statutory violation.”
“Defendant does not argue that this instruction was in error as it accurately stated the law. Plaintiffs were entitled to such a presumption and it was up to the jury to determine if the presumption applied and whether it had been rebutted. The trial court did not instruct the jury that it must find the unidentified driver negligent because he or she rear-ended plaintiffs’ car. Rather, the court told the jury that it ‘may infer that the hit and run driver was negligent’ if it found that the unidentified driver violated the rear-end collision statute. (Emphasis added). Accordingly, the jury understood that the violation of the rear-end collision statute created a rebuttable presumption of negligence and that it was not obligated to find the unidentified driver negligent based on the statutory violation. Defendant introduced evidence that the rear-end collision statute might not even have applied, and both attorneys emphasized to the jury that if the presumption applied, it still needed to determine whether the unidentified driver was free from negligence. The jury was fully and properly instructed on negligence and causation, and, for the reasons discussed, the jury was informed that this determination hinged on the weather conditions at the time of the second collision.”
The Court of Appeals then turned to the trial court’s ruling that the Pauls were not entitled to UTPA penalty interest, holding that the trial court erred in determining that the Pauls needed to “cite the statute specifically or bring a claim under the UTPA” in their complaint. According to the Court, UTPA penalty interest is not a ‘claim’ to be alleged in a complaint; it is a statutory penalty for failing to pay UM benefits in a timely manner. Having been found to have failed to pay UM benefits in a timely manner at trial, Farm Bureau was required to pay UTPA penalty interest, and thus the Court remanded for entry of such an award.
“Therefore, the only issue is whether plaintiffs were required to advance a specific claim under the UTPA, or at least to cite specifically to MCL 500.2006(4), in their complaint. As plaintiffs point out, they did specifically ask for “interest” in addition to a $500,000 judgment against defendant. Plaintiffs did not mention the statute or the UTPA, however, in Michigan, the pleadings must sufficiently inform the opposing party of the nature of a claim or defense to allow the opposing party to respond in a meaningful way. Glasker-Davis v Auvenshine, 333 Mich App 222, 229-232; 964 NW2d 809 (2020). Significantly, however, no private claim exists under MCL 500.2006. Young v Mich Mut Ins Co, 139 Mich App 600, 604-606; 362 NW2d 844 (1984).8 Rather, MCL 500.2006(4) is a statutory penalty that imposes damages under certain circumstances. Commercial Union Ins Co v Liberty Mut Ins Co, 426 Mich 127, 136 n 5; 393 NW2d 161 (1986). “The statute is intended as a penalty to be assessed against insurers who procrastinate in paying meritorious claims in ‘bad faith’. . . . [I]t evinces no intent to compensate a plaintiff for the delay in recovering funds rightfully his.” Medley v Canady, 126 Mich App 739, 743-744; 337 NW2d 909 (1983). Thus, statutory penalty interest under MCL 500.2006(4) is not a “claim” that could be alleged in a complaint, and at least under the undisputed facts of this case, no conceivable defense could exist other than prevailing in the substantive UIM claim. The trial court erred by concluding that the penalty interest was unavailable to plaintiffs because they failed to cite the statute specifically or bring a claim under the UTPA.”