Michigan Court of Appeals; Docket Nos. 179937 and 181319; Published
Judges Taylor, Murphy, and Grant; Unanimous; Opinion by Judge Taylor
Official Michigan Reporter Citation: 218 Mich App 619; Link to Opinion 
STATUTORY INDEXING:
Workers Comp Liens Regarding Auto Tort Claims [§3116]
TOPICAL INDEXING:
Workers Disability Compensation Act (MCL 418.1, et seq.)
CASE SUMMARY:
In this unanimous published Opinion by Judge Taylor, the Court of Appeals held that where a workers' compensation carrier pays benefits in substitution for no-fault benefits that would have otherwise been properly paid by a no-fault insurer, it stands in the place of the no-fault insurer and is not entitled to assert a workers' compensation lien against plaintiff’s settlement with the motorist tortfeasor and a hospital for claims of malpractice in connection with treatment of the injuries that plaintiff sustained in the auto-related accident.
In this case, plaintiff was injured at his place of employment when he attempted to prevent injury to another person by a rolling truck. While attempting to render aid, plaintiff sustained injuries which were then treated at a local hospital. A claim of medical malpractice arose out of that treatment. That claim was ultimately settled, as was a claim against the owner of the truck. The plaintiff received no-fault insurance benefits and workers' compensation benefits, which were coordinated with the no-fault benefits.
The Court of Appeals first held that there was no question that the workers' compensation carrier was not entitled to a lien if no-fault benefits were properly paid. Great American Insurance Company v Queen (Item No. 376). In Great American, supra, the Supreme Court held that where the workers' compensation carrier seeks reimbursement for payments which are made in substitution for no-fault benefits that would otherwise have been payable had it not been for the governmental benefit setoff provisions of §3109(1), the workers' compensation carrier has no right of reimbursement out of the third party tort recovery.
In the instant case, the Court of Appeals held that no-fault benefits were properly paid, and therefore, there was no right of recovery of the workers' compensation benefits from the third party tort claim against the owner and operator of the vehicle. The injury occurred while the engine was running and during an attempt to back up the vehicle, which was sufficient to establish the "arising out of” requirement of §3105, and to establish that no-fault benefits were properly paid. The court noted, however, that the payment of no-fault benefits by the no-fault insurance company did not bar, as a matter of law, the workers' compensation carrier from claiming that the benefits were not properly paid. It is conceivable that a no-fault carrier, because of a misapprehension of the law or facts, would make no-fault payments where none were due. In such a circumstance, the workers' compensation carrier may seek to intervene and request a determination from the court regarding the propriety of the payment of no-fault benefits and thus obtain a ruling of whether it is barred from seeking reimbursement.
The court next addressed whether or not the workers' compensation carrier was entitled to assert a Hen against the third party recovery obtained against the hospital for medical malpractice. The court held that because these benefits were in substitution for no-fault benefits that would have otherwise been paid by the no-fault insurer, Crum & Forster did not have any greater rights to reimbursement than that which would be permitted a no-fault insurer under the No-Fault Act. The court held that "because a no-fault insurer would not be entitled to reimbursement from a plaintiff's recovery from a non-motorist tortfeasor whose liability arises outside the ownership or operation of a motor vehicle, Crum & Forster, standing in the place of a no-fault insurer, is not entitled to assert lien rights on plaintiff's settlement with defendant Mercy Hospital."
[Editor's Note: This case was inadvertently omitted from prior supplements.]
