Michigan Court of Appeals; Docket #300592 and 303885; Unpublished
Judges Owens, Jansen, and Markey; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion
STATUTORY INDEXING:
None
TOPICAL INDEXING:
Attorney Fee Liens Intervention by Service Providers and Third-Party Payors in PIP Claims
In this unanimous unpublished per curiam Opinion, the Michigan Court of Appeals affirmed the trial court’s denial of Willowbrook Rehabilitation Services’ motion to intervene in the lawsuit brought by Carolyn Nicholson on behalf of the injured person, Jeanne Nicholson, against Citizens Insurance Company for payment of no-fault benefits for the injuries Ms. Nicholson sustained in the subject motor vehicle accident. The Court of Appeals also affirmed the trial court’s Order awarding Lerner a one-third attorney fee deducted from payments owed to Willowbrook that were recovered as a result of Nicholson’s legal action against Citizens. The Court of Appeals also affirmed the trial court’s grant of summary disposition in the separate, but related case, Willowbrook brought against Nicholson’s attorneys, Joshua A. Lerner and Cohen, Lerner & Rabinovitz, P.C., in which Willowbrook brought claims for unjust enrichment, tortious interference with business expectation, claim and delivery, and conversion.
In these two consolidated cases, the underlying issue was that Nicholson, the injured person, was represented by Joshua Lerner in a legal action against Citizens Insurance Company for recovery of various no-fault benefits, which included payment of the bills Nicholson incurred for the services she received from Willowbrook. Through the litigation of this case, full payment of the bills incurred for the Willowbrook services was recovered. Willowbrook was then asked to pay one-third of the amount recovered for payment of Mr. Lerner’s attorney fees pursuant to the one-third contingent fee contract he had with Nicholson. Willowbrook moved to intervene after Nicholson and Citizens had reached an agreement regarding payment of the no-fault benefits at issue in this case. However, at that time, no judgment had been entered regarding whether Citizens was liable for penalty interest or had acted unreasonably and was, therefore, liable for attorney fees.
In affirming the trial court’s denial of Willowbrook’s motion to intervene, the Court of Appeals ultimately determined that the trial court did not abuse its discretion in denying Willowbrook’s motion to intervene, because allowing Willowbrook to intervene at the time it attempted to do so, would have delayed the litigation and multiplied the issues remaining in the case. In reaching this conclusion, the Court of Appeals noted that even though Willowbrook’s motion to intervene was timely, the Court of Appeals primarily based its reasoning on the notion that considering the only remaining issues in the case were whether Citizens was liable for penalty interest and attorney fees, Willowbrook’s intervention would only complicate issues of whether a no-fault insurance company would need to pay attorney fees for multiple parties, whether the entire amount of attorney fees would be apportioned, and whether Willowbrook would even be eligible to receive these attorney fees. The Court of Appeals further explained that if the issue were only whether a medical provider who was a party in a lawsuit had a right to seek penalty interest or attorney fees, the trial court’s decision may have constituted an abuse of discretion. However, in this case, Willowbrook was not a party to the lawsuit, and since there is no case law holding that a non-party medical provider is eligible to collect attorney fees or penalty interest, it could not be said that the trial court abused its discretion in deciding that Willowbrook did not have a right to penalty interest or attorney fees that was being impaired by the trial court’s denial of Willowbrook’s motion to intervene. Moreover, apparently, in a separate action not at issue on appeal, Willowbrook sued Citizens to recover penalty interest and attorney fees it was not able to pursue on its own basis in Nicholson’s action. In affirming the trial court’s Order awarding Mr. Lerner a one-third attorney fee deducted from the payments recovered from Citizens, the Court of Appeals recognized that pursuant to the holdings in Miller v Citizens Ins Co, 490 Mich 904 (2011), affirming in part and reversing in part, 288 Mich App 424 (2010), it was fair for Mr. Lerner to be compensated for his attorney time and he had a legal right, under the contingent fee contract, to take this portion as part of his attorney fees. The court further explained that Willowbrook remained free to pursue payment of the remainder of its bill from Nicholson or whomever might be legally responsible for the services Willowbrook provided to her.
With respect to Willowbrook’s claims for unjust enrichment, tortious interference with business expectation, claim and delivery, and conversion, the Court of Appeals affirmed the trial court’s Order granting summary disposition in favor of Mr. Lerner and his law firm, primarily on the basis that there is absolutely nothing illegal or improper about Lerner taking the one-third attorney fee from the amounts recovered for Willowbrook’s services and, therefore, all of these claims failed as a matter of law.
