Michigan Court of Appeals; Docket No. 71702; Published
Judges Kelly, Beasley, and Stempien; Unanimous; Per Curiam
Official Michigan Reporter Citation: 141 Mich App 379; Link to Opinion 
STATUTORY INDEXING:
Calculation of Survivor’s Loss Benefits and Maximums [§3108(1)]
Dependents [§3108(1)]
Standards for Deductibility of State and Federal Governmental Benefits [§3109(1)]
Social Security Survivor’s Benefits [§3109(1)]
State Pension Benefits [§3109(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous per curiam Opinion by Judge Kelly, the Court of Appeals rendered several significant holdings regarding survivor's loss benefits payable to dependents of a governmental worker whose widow is receiving a retirement pension upon his death, and the calculation of survivor's loss benefits where the decedent leaves children both from a prior marriage and from his current marriage.
The decedent in this case was a Michigan State Police Trooper who died in an off-duty automobile accident after serving 13 years with the State Police. Under the State Police Pension, Accident and Disability Fund Act (MCLA 28.1, et seq decedent's spouse (plaintiff in this case) was entitled to begin drawing her husband's retirement pension immediately upon his death in the same amount as if the trooper had retired the day preceding the date of death. This type of early retirement pension payable upon death is only available to those troopers who have worked in the department for more than 10 years. The defendant argued that this retirement pension was a "governmental benefit" which should be subtracted from plaintiff’s no-fault survivor's benefits under §3109(1) of the act.
The Court of Appeals unanimously rejected defendant's contention and ruled that plaintiff’s retirement pension was not a governmental benefit which should be subtracted under §3109(1). The court applied the two-prong test set forth in the Supreme Court's opinion in Jarosz v DAIIE (Item No. 702), which provides that a governmental benefit can only be set off where: (1) the benefit substantially serves the same purpose as that served by the no-fault benefit; and (2) the benefit is payable as a result of the same accident Both prerequisites must be satisfied. In this case, the Court of Appeals held that plaintiff’s retirement pension did not serve substantially the same purpose as that served survivor's loss benefits. The court agreed with the trial court's analysis mat "no-fault survivor's loss benefits are designed to replace the loss of income or wages that decedent would have enjoyed had he continued his employment No-fault survivor's benefits thus duplicate workers' compensation benefits and social security survivor's loss benefits. Contrary to the defendant's argument on appeal, however, we find that the state police pension is intended to protect the decedent's retirement contributions and is not intended to replace decedent's wages. MCLA 28.107(4) clearly refers to the pension as a retirement benefit. Under that provision, a spouse is entitled to a pension computed as if the deceased had retired the day preceding his or her death. Further, the pension is referred to as a 'retirement allowance' payable to the widow until death only if the trooper had accumulated at least 10 years of service."
The second major aspect of the court's holding deals with the proper way to calculate survivor's loss benefits in broken home situations. The decedent in this case left two minor children from a previous marriage, as well as a surviving spouse and a minor child from his current marriage. Both households were receiving Social Security survivor's loss benefits. Prior to his death, decedent was under the obligation of a Judgment of Divorce to pay approximately $303 per month in child support for the two minor children from the previous marriage. No other evidence was presented in the trial court that these two children would have received anything more than the child support payments from decedent Therefore, the no-fault survivor's loss benefits due and owing to these two minor children of the previous marriage consisted of an amount equal to the monthly child support payments. From that amount, the Social Security survivor's benefits payable to these two children should be subtracted. The net amount remaining, if any, is the extent of the no-fault survivor's loss benefits payable to the children of the previous marriage. In light of the fact that the Social Security survivor's loss benefits equaled the no-fault survivor's loss benefits that would have gone to the two children of the previous marriage, no no-fault survivor's loss benefits were payable to those two children. The remainder of the no-fault benefits should thus be payable to decedent's current widow and his minor child from his current marriage.
In so holding, the court distinguished the Supreme Court's recent decision in Thompson v DAIIE (Item No. 731) wherein Justice Levin expressly acknowledged that Social Security benefits received by all members of a family.should not necessarily be lumped together in calculating the government setoff under §3109(1) where the insured, due to divorce, was not living in the same household as all of his dependents.
Finally, the Court of Appeals upheld the award of double interest under §3142 and §60.13 of the RJA without regard to the reasons for defendant's nonpayment of benefits.
