Michigan Court of Appeals; Docket #217613; Unpublished
Judges Hood, Doctoroff and K.F. Kelly; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
Requirement That Benefits Were Unreasonably Delayed or Denied
Presumption of Unreasonableness
TOPICAL INDEXING:
Employee Retirement Income Security Act (ERISA – 29 USC Section 1001, Et Seq.)
CASE SUMMARY:
In this unanimous per curiam unpublished opinion, the Court of Appeals upheld an award of actual attorney fees pursuant to 3148(1) of the No-Fault Act, where the insurance company had unreasonably refused to pay plaintiff’s medical expenses after it was notified of its priority status.
In this case, plaintiff had a health insurance policy through a self-funded ERISA plan. The attorney for the ERISA plan sent a letter to Hastings Mutual’s adjuster advising that Hastings Mutual was responsible for paying plaintiff’s auto accident related medical expenses. The Court of Appeals held that upon receipt of that letter, Hastings was obligated to pay plaintiff’s outstanding medical expenses within 30 days after receiving proof of the losses. The court held that the priority dispute would not excuse untimely payments. Citing Bloemsa v Auto Club Insurance Association, 174 Mich App 692 (1989) [Item No. 1220], the Court of Appeals held that if an insurer refuses to make payments or delays payments, a rebuttable presumption of unreasonableness arises that places the burden on the insurer to justify the refusal or delay. If the refusal or delay is the product of a legitimate question of statutory construction, constitutional law, or factual uncertainty, it will not be deemed unreasonable. However, a priority dispute among insurers will not excuse an insurer’s delay in making timely payments.
The Court of Appeals also rejected Hastings contention that the amount of attorney fees assessed was unreasonable. The court found $200 per hour as a reasonable hourly rate and also found that the amount of time charged was reasonable. The fact that defense counsel was paid a substantially lower rate ($85 per hour) for the same case did not require the conclusion that plaintiff’s counsel’s hourly rate was unreasonable. The fee normally charged in the same locality for similar legal services is a proper consideration.
