The Michigan Supreme Court, Docket No. 133416; Published
4-3 Order (with Weaver, Cavanagh, and Kelly dissenting)
Official Michigan Reporter Citation: 480 Mich 1097; Link to Opinion 
Link to COA Summary
STATUTORY INDEXING:
One-Year Back Rule Limitation [3145(1)]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this 4-3 Order, with Justices Weaver, Cavanagh, and Kelly dissenting, the Supreme Court, after hearing oral arguments on the application for leave to appeal the February 1, 2007 judgment of the Court of Appeals, and in lieu of granting leave to appeal, REVERSED the judgment of the Court of Appeals. In this regard, the Court explained:
"Under the Michigan No-Fault Act, MCL 500.3101 et seq., when defendant made partial payments and refused to pay for specific services in plaintiff’s invoices, plaintiff could not insulate those services from the one-year back rule, MCL 500.3145(1), by unilaterally applying defendant’s subsequent payments to the remainder of the overdue invoices. Defendant produced evidence that it explicitly allocated payments to specific invoices, leaving specific portions unpaid. Plaintiff failed to meet its burden under MCR 2.116(C)(10) to produce evidence that either refuted defendant’s evidence or demonstrated defendant’s assent to plaintiff’s accounting practice. Maiden v Rozwood, 461 Mich 109, 120-21 (1999). Plaintiff’s remedy for defendant’s refusal to pay was provided by statute. A payment is overdue “if not paid within 30 days after an insurer receives reasonable proof of the fact and of the amount of loss sustained.” MCL 500.3142(2). Overdue payments are assessed a penalty of “simple interest at the rate of 12% per annum.” Id. § 3142(3). Plaintiff was required to file an action for the overdue payments within 1 year of when the losses were incurred. Id. § 3145(1). “Incurred” means “‘[t]o become liable or subject to, [especially] because of one’s own actions.’” Proudfoot v State Farm Mut Ins Co, 469 Mich 476, 484 (2003), quoting Webster’s II New College Dictionary (2001). “Liable” is defined as “legally responsible[.]” Random House Webster’s College Dictionary (1991). Generally, one becomes liable for the payment of services once those services have been rendered. “‘[P]laintiff became liable for her medical expenses when she accepted medical treatment.’” Bombalski v Auto Club Ins Ass’n, 247 Mich App 536, 542 (2001), quoting Shanafelt v Allstate Ins Co, 217 Mich App 625, 638 (1996). As this Court explained in Proudfoot, supra at 484 n 4, “An insured could [become] liable for costs by various means, including . . . signing a contract for products or services.” In this case, the expenses for services were “incurred” when the services were rendered."
