Court of Appeals; Docket No. 304235; Unpublished
Judges Talbot, Servitto, and M. J. Kelly; unanimous; per curiam
Official Michigan Court Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not applicable
TOPICAL INDEXING:
Attorney Fee Liens
In this unanimous per curiam unpublished opinion, the Court of Appeals vacated the decision of the trial court which had ruled in favor of the defendant, George R. Hamo, P.C., on its claim for an attorney fee/charging lien from no-fault auto insurance proceeds attributable to plaintiff Hurley’s medical expenses.
The facts were not disputed in this case that the injured party was in an automobile accident on February 23, 2009 giving rise to $17,541 in medical expenses for treatment at Hurly Medical Center. On October 9, 2009, Hurly contracted with Advomas, Inc. to investigate the accident, determine the no-fault insurer, and secure payment of Hurley’s medical bills. On November 26, 2009, the injured child, through her mother, retained the services of George R. Hamo, P.C. pursuant to a contingency fee agreement to secure no-fault personal injury protection benefits. Both Hamo and Advomas engaged in actions asserting rights to payment for the medical expenses and to take steps to preserve the claim under the one-year-back rule contained in MCL 500.3145. On January 18, 2010, Hurley filed a lawsuit against the applicable no-fault insurer. On March 30, 2010, the insurer issued a check for the full amount of the medical expenses owed to Hurley made payable to defendant Hamo with a note that it was in payment for the Hurley Medical Center expenses.
This action was brought to determine whether Hamo was entitled to an attorney fee from a portion of the insurance proceeds attributable to the medical expenses incurred by Hurley. The trial court determined that because of Hamo’s “substantial efforts,” Hamo was entitled to recover attorney fees from the insurance proceeds under the “common fund exception” to the American rule, which holds that attorney fees are not ordinarily recoverable from another party unless a statute, a court rule, or common law exception provides to the contrary.
The Court of Appeals held in this case that the trial court erred in its reliance on Miller v Citizens Ins Co, 288 Mich App 424 (2010) in light of the fact that the Miller supra decision was subsequently reversed in part with respect to the common fund exception portion of its ruling. In so ruling, the court stated:
“The trial court’s approach was consistent with this Court’s decision in Miller, but that approach has now been rejected by the Supreme Court. Hurley was not a beneficiary of a common fund. Hurley is a creditor whose contractual right to payment for its services to Hamo’s client is undisputed. Hamo’s work on behalf of its client to collect no-fault benefits from the insurer provided an incidental benefit to Hurley because it offered funds that the client could use to pay Hurley. That incidental benefit, even if it is the only realistic hope for payment, does not make Hurley liable under a common-fund theory for payment of attorney fees owed to Hamo by its client.”
In light of the above, the Court of Appeals vacated the trial court’s order granting summary disposition to Hamo and remanded for further proceedings consistent with the Supreme Court’s order in Miller.
