Michigan Court of Appeals; Docket #269726; Unpublished
Judges Borrello, Jansen, and Cooper; 2-1 (Judge Jansen dissenting); per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
On March 7 2008, the Michign Supreme Court REVERSED the Court of Appeals; Link to MSC Summary
STATUTORY INDEXING:
One-Year Back Rule Limitation [3145(1)]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this 2-1 unpublished per curiam opinion, decided without oral argument, the Court of Appeals found that even though some of the bills at issue in this action to recover first-party benefits were incurred more than one year before plaintiff filed suit, defendant was not entitled to summary disposition based upon the one-year-back rule under MCL 500.3145(1), because there was a question of fact regarding defendant’s payment practices.
In 1997, plaintiff began providing case management services to defendant Progressive’s insured. In 2004, plaintiff filed this action for payment on invoices submitted since July 1999 which totaled $60,023.22. Defendant moved for summary disposition, arguing that plaintiff was barred from recovering approximately $20,000 of the amount under the one-year-back rule. In opposition to the motion, plaintiff submitted a customer balance detail document which showed that defendant would regularly wait to make payment until it had accumulated several invoices and then it would not necessarily pay the entire amount. The trial court denied defendant’s motion, finding a question of fact existed regarding whether a course of dealing had been established by the routine invoicing and payments that plaintiff and defendant had followed.
In affirming, the Court of Appeals agreed that the documentary evidence showed that payments were often delayed a significant amount of time, typically covered multiple invoices, and often left significant balances. Therefore, it found there was a question of fact as to the understanding between the parties and concluded that plaintiff’s tolerance of defendant’s practice should not be rewarded by a shortfall. In this regard, the Court of Appeals stated:
“Given that . . . payments were often significantly delayed, typically applied to multiple invoices, and more often than not left unpaid balances to accrue, we would agree that there is some question as to the understanding between these parties about their billing arrangement. We find this fact question is highlighted by the point that although defendant kept up with payments, albeit delayed, for several years, before delaying so long that plaintiff ultimately decided to file suit to collect. Plaintiff’s patience with defendant’s delayed payment process should not be rewarded by a shortfall of $19,684.64 in expenses billed according to the process routinely followed by the parties.”
