Michigan Supreme Court; Docket No. 105914; Published
Per Curiam Opinion, Unanimous (with Justice Boyle concurring separately and Judge Kelly not taking part)
Official Michigan Reporter Citation: 454 Mich 263; Link to Opinion 
STATUTORY INDEXING:
Limitations Period for PPI Claims [§3145(2)]
Tolling of Limitations for Estoppel [§3145]
TOPICAL INDEXING:
Equitable Estoppel
CASE SUMMARY:
In this unanimous per curiam opinion, with Justice Boyle concurring separately, the Michigan Supreme Court reversed the Court of Appeals and applied the doctrine of estoppel to preclude a no-fault insurance company from asserting the one year statute of limitations contained in §3145(2) with regard to a property protection insurance benefits claim. The claim in question was in the nature of a "subrogation" claim asserted by plaintiff Cincinnati Insurance Company against defendant Citizens Insurance Company arising out of a motor vehicle accident wherein defendant's insured ran into a building insured by plaintiff. Plaintiff’s insurance adjuster timely presented the claim to defendant Citizens within one year of the accident, and then sent several letters to defendant further documenting the nature and the extent of the claim. The adjuster handling the claim for defendant Citizens carried on a regular dialog with plaintiff’s adjuster regarding the processing of the claim. During these ongoing discussions, the adjuster for defendant stated to plaintiff’s adjuster that Citizens preferred not to handle claims piecemeal, "thereby suggesting" to plaintiff’s adjuster that Citizens would make payment on the loss after documentation regarding all facets of the loss had been submitted. During this documentation process, the one year statute of limitations contained in §3145(2) expired. After the expiration of the statute of limitations, the defense adjuster denied the claim on the basis that the claim was now time barred.
The Supreme Court disagreed with the decisions of the trial court and appellate court to enforce the one year statute of limitations. The court held that the doctrine of estoppel applied to prevent assertion of the statute of limitations defense. In invoking the doctrine, the Supreme Court stated as follows:
"The one who seeks to invoke the doctrine [of equitable estoppel] generally must establish that there has been (I) a false representation or concealment of the material fact, (2) an expectation that the other party will rely on the misconduct, and (3) knowledge of the actual facts on the part of the representing or concealing party. This court has been reluctant to recognize an estoppel absent intentional or negligent conduct designed to induce a plaintiff to refrain from bringing a timely action. Negotiations intended to forestall bringing an action have been considered an inducement sufficient to invoke the doctrine, however.... It would be unjust to allow Citizens to assert the statute of limitations where Cincinnati, through claims specialist Kapala, acted in apparent good faith and for the convenience of Citizens to defer his demand for payment until Family Urology's total loss had been documented. The only alternative was for Cincinnati to initiate a lawsuit within the limitation period. One of the important reasons for enacting the no-fault system, however, was to reduce automobile accident litigation....
In short, the record contains ample evidence that Cincinnati (through Kapala) was justified in relying, and did rely, on the representations of Citizens (through Mr. Griggs) that the subrogation claim would be processed without difficulty, once all of the documentation was complete. The fact that Citizens did not intend to honor its representations is demonstrated by the fact that it did not honor them.... Where Cincinnati had submitted a timely claim to Citizens for the primary contents loss, and then two insurers had agreed to cooperate regarding the processing of the matter in its entirety, Citizens was estopped from asserting the statute of limitations as a bar to Cincinnati's circuit court action...."
Justice Boyle concurred separately "under the unique circumstances presented” which showed that the plaintiff was complying with the defendant's desire to handle the claim using a procedure of defendant's choice. Thus, the defendant should be estopped from asserting the statute of limitations.
