United States District Court, Western District; Docket No. R82-387 C.A.;
Judge Benjamin F. Gibson; Unpublished
Official Federal Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Standards for Deductibility of State and Federal Governmental Benefits [§3109(1)]
Other Benefits [§3109(1)]
Liability for Excess Economic Loss Caused By Insured Tortfeasors [§3135(3)(b)]
Liability of Non-Motorist Defendants [§3135]
General / Miscellaneous [§3135]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this written Opinion, Judge Gibson dealt with a government claim for reimbursement of medical expenses incurred by a severely injured seaman, in an action brought under the Medical Care Recovery Act. (42 USC §2651-53)
Under the Medical Care Recovery Act, the government may recover medical expenses incurred as a result of injuries arising "under circumstances creating a tort liability upon some third person." Here, the injured seaman was walking along a street when struck by an automobile driven by defendant Jackson. At the time of the accident, Jackson was intoxicated as a result of an allegedly illegal sale of alcohol provided by defendant Couvelis. The AAA Insurance Company provided no-fault automobile insurance benefits to the injured seaman.
Judge Gibson ruled that under the no-fault statute, the injured seaman had no claim against defendant driver Jackson, because the No-Fault Act contemplates payment for medical expenses directly by the injured party's own insurance. Therefore, there was no "tort liability upon" Jackson, which would allow the government to seek reimbursement of medical expenses it paid. Judge Gibson, therefore, held that the claim against defendant driver Jackson should be dismissed.
The claim by the government against the alleged "dram shop" was treated differently. Judge Gibson held that the Michigan Dram Shop Law does "create tort liability" as to the provider of alcohol. Therefore, the Medical Care Recovery Act authorized action by the United States against the dram shop for the medical expenses paid by the government. Judge Gibson rejected the argument that because the injured seaman had settled his claim against the driver, the government could not maintain this action because of the "name and retain" clause in the Michigan Dram Shop Act. Judge Gibson held that the "name and retain" defense was the type of defense which has nothing to do with whether the circumstances surrounding the injury create a tort, and therefore, those defenses cannot defeat the independent right of the government to recovery. Additionally, since the government has already been found not to have a claim against the defendant driver, it is well established in Michigan that the alleged intoxicated party need not be "retained" if the plaintiff has no cause of action against him.
Finally, Judge Gibson dismissed the claim of the government against the injured party's no-fault insurance company, AAA. Judge Gibson held that the clear intent of §3109(1) under Michigan law was to provide for a set off of governmental benefits. The United States is not a third party beneficiary of the injured party's no-fault insurance policy, and the claim against AAA should be dismissed.
