Michigan Supreme Court; Docket #142615; Published
Michigan Court of Appeals; Docket #302508; Unpublished
Justice Mary Beth Kelly joined by Justices Young, Markman, and Zahra; 4-3 per curiam; Justice Marilyn Kelly dissenting
Official Michigan Reporter Citation: Not applicable; Link to Opinion
STATUTORY INDEXING:
One-Year Notice Rule Limitation [§3145(1)]
One-Year Back Rule Limitation [§3145(1)]
Tolling of Limitations for Minors [§3145(1)]
Tolling of Limitations for Mental Incompetence
Applicability of Limitations Period to Governmental Claimants
TOPICAL INDEXING:
Not Applicable
In this 4-3 published per curiam Opinion by Justice Mary Beth Kelly, the Michigan Supreme Court overruled its recent decision in University of Michigan Regents v Titan (RB #3136) and reinstated its earlier decision in Cameron v Auto Club (RB #2648) and held that the one-year-back rule contained in § 3145 (1) is not tolled by the minority/insanity tolling provisions of MCL 600.5851(1) because those tolling provisions only toll statute of limitations, not statutes limiting damages. The court held that the one-year-back rule in § 3145(1) was not a statute of limitations, but was only a limitation on damages and, therefore, was not subject to RJA tolling.
In so ruling, the court reaffirmed its earlier analysis in Welton v Carriers Ins Co (RB #801) that § 3145(1) “contains two limitations on the time for filing suit and one limitation on the period for which benefits may be recovered.” The first limitation on the time for filing suit provides that a PIP benefit lawsuit must be filed not later than one year after the accident unless the insured is given written notice or the insured has paid benefits within one year. The second limitation on the time for filing suit provides that if notice has been given or payment made during the first one year, a lawsuit may be commenced at any time after the most recent loss was incurred. The one-year-back rule, however, is not a limitation on the time for filing suit, but rather is a provision that limits recovery to only those losses incurred during the one year immediately preceding the filing of the complaint. Therefore, RJA tolling does not apply to the one-year-back rule.
The court’s analysis of the three time periods in § 3145(1) clearly indicates that RJA tolling would be applicable to the two referenced limitations on the time for filing suit. Therefore, the failure of a minor or insane person to give notice within one year of the accident or to file suit within one year of the most recent incurred expense, would be subject to RJA tolling and, therefore, the claim would be preserved subject to the one-year-back rule’s limitation on recovery.
In reaching its conclusion, the majority opinion stated “Regents was wrongly decided for the simple reason that it ignored the Legislature’s clear and unambiguous directives in MCL 500.3145(1) and MCL 600.5851(1) by failing to enforce the statutory provisions as written.” Therefore, the court concluded that the doctrine of stare decisis does not compel adherence to the Regents rule. Consequently, the court stated “we overrule Regents and return the law, as is our duty, to what we believe the citizens of this state reading these statutes at the time of enactment would have understood them to mean. . . .We reinstate our previous decision in Cameron.”
Justice Marilyn Kelly dissented, joined by Justices Cavanagh and Hathaway. In her dissent, Justice Kelly stated “the significant point is that Cameron is the first decision in which this court recognized the distinction between limitations in MCL 3145(1) and applied them differently. In so doing, the Cameron majority upended 25 years of settled law and drew a distinction that even the defendant did not initially ask it to draw. These simple facts call into doubt the majority’s contentions that Cameron was ‘compelled to overrule non-binding precedent’ and that Regents ‘ignored the Legislature’s clear and unambiguous directive in MCL 500.3145(1). If the Legislature’s directive were [sic] truly so clear and unambiguous, why did the prevailing interpretation of MCL 500.3145(1) go unchallenged for nearly 25 years. . . . That the Legislature wanted to grant a minor or insane person the right to prove his or her damages in a court of law while lacking any opportunity to be awarded them defies common sense.”
