Michigan Court of Appeals; Docket No. 90966; Published
Judges Maher, McDonald, and Deming; Unanimous; Per Curiam
Official Michigan Reporter Citation: 163 Mich App 634; Link to Opinion 
STATUTORY INDEXING:
Allowable Expenses for Rehabilitation [§3107(1)(a)]
Allowable Expenses: Reasonable Necessity Requirement [§3107(1)(a)]
Allowable Expenses: Reasonable Charge Requirement [§3107(1)(a)]
Penalty Attorney Fees and Other Court Rule Sanctions [§3148]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous per curiam Opinion, the Court of Appeals affirmed a judgment in plaintiff’s favor for the expense of vocational rehabilitation.
Plaintiff was seriously injured in an automobile accident, which resulted in her being unable to talk for three years thereafter. Plaintiff’s vocal cords were permanently deformed and medical testimony demonstrated that her voice would never return to normal. Defendant refused to pay for plaintiff’s anticipated expense of vocational rehabilitation. At the close of trial, the trial court entered an opinion in reliance upon OAG, 1983-1984, No. 6129; and Bailey v DAIIE, 143 Mich App 223 (1985).
Both the Attorney General opinion and the Bailey, supra, case had held that § 3107(a) included as allowable expenses the expense of vocational rehabilitation. The trial court also found that defendant's conduct in taking a rigid approach in rejecting plaintiff’s claim for such benefits was unreasonable, and awarded attorney fees.
The Court of Appeals concluded that Bailey, supra, had been properly decided. The Court declined to adopt any "definite operational guidelines" for determining the fact and extent of a claimant's entitlement to such benefits. The Court found that §3107(a) sets forth the standard by establishing two requirements (1) that products, services and accommodations be "reasonably necessary;" and (2) charges must be reasonable. The determination of the reasonable necessity for the products and the reasonableness of the charges the Court felt was a factual question best left to the trial courts.
With regard to attorney fees under §3148, the Court of Appeals felt that the trial court's decision was not clearly erroneous. The trial court's decision was based upon defendant's steadfast position that vocational rehabilitation expenses were not covered under the No-Fault Act despite the 1983 Attorney General Opinion to the contrary, as well as defendant's awareness of the decision reached in Bailey, supra, at both the trial level and in the Court of Appeals.
Finally, the Court of Appeals ruled that an award of attorney fees under the no-fault statute, §3148, served a purpose separate and distinct from the award of attorney fees under the mediation sanctions. The no-fault attorney fee award is in the nature of a penalty for an insurer's unreasonable refusal or delay in making payments, whereas the mediation sanction rule is designed to place the burden of litigation costs upon the party who insists upon a trial. Recovery therefore under both the mediation sanction rule and the no-fault statute is appropriate. However, in the instant case, the Court of Appeals concluded that the plaintiff did not successfully exceed the mediation award by 10%, and therefore was not entitled to sanctions.
