Michigan Court of Appeals; Docket #315942; Published
Judges Boonstra, Meter, and Servitto; 2-1 (Judge Servitto dissenting); Non-unanimous Opinion by Judge Boonstra
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
Link to Dissent
The Michigan Supreme Court granted leave to appeal on 4/1/2015; Link to Order
STATUTORY INDEXING:
One-Year Back Rule Limitation [§3145(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this 2-1 published per curiam Opinion (with Judge Servitto dissenting) involving a claim for no-fault benefits that was filed more than one year after the accident, the Court of Appeals held that the time limitations in MCL 500.3145(1) did not apply because the insurer “made a payment of personal protection insurance benefits for the injury within one year of the accident.”
Plaintiff was injured when a car struck the motorcycle he was riding. He brought a claim against defendants for negligence. Defendant Auto Club Insurance Association paid PIP benefits, but eventually stopped. The trial court let plaintiff amend his complaint to add a no-fault claim against Auto Club, but Auto Club asserted that it had already paid benefits and, pursuant to §3145(1), plaintiff could not recover for any expenses incurred more than one year before the date the action was commenced. Plaintiff argued defendant waived the one-year-back defense by not asserting it in its first responsive pleading. The trial court dismissed the case, finding the statute of limitations had expired. The trial court did not address plaintiff’s defense waiver argument.
Affirming the trial court’s decision, the Court of Appeals said:
“We … hold that MCL 500.3145(1) allows for suit to be filed more than one year after the date of the accident causing injury only if the insurer has either received notice of the injury within one year of the accident or made a payment of personal protection insurance benefits for the injury within one year of the accident.”
Relying on the plain language of the statute, the Court of Appeals rejected plaintiff’s claim that, when an insurer has paid benefits, the limitations provision in §3145(1) does not apply even if payment was not made within one year of the accident. The court said:
“[T]he statute … provides two exceptions to the general rule, under which a suit may be brought more than one year after the date of the accident. The first exception is where ‘written notice of injury as provided herein has been given to the insurer within 1 year after the accident ….’ The second exception is where ‘the insurer has previously made a payment of personal protection insurance benefits for the injury.’ Although the first exception explicitly requires that notice have been provided within one year of the accident, the second exception requires that the insurer have ‘previously’ made a payment of insurance benefits.”
The first exception did not apply in this case, the Court of Appeals said, because the insurer received notice of plaintiff’s injury more than one year after the accident. The court stated:
“Since the first exception is inapplicable in this case, our interpretation of the plain language of the statute is facilitated by removing the language of the first exception, such that the relevant statutory language becomes: ‘An action for recovery of personal protection insurance benefits … may not be commenced later than 1 year after the date of the accident causing the injury …unless the insurer has previously made a payment of personal protection insurance benefits for the injury.’ … We conclude from this plain statutory language that the Legislature intended that the word ‘previously’ mean previous to ‘1 year after the date of the accident causing injury.’ …This interpretation is supported by the fact that the Legislature juxtaposed ‘previously’ with ‘1 year after the date of the accident causing injury,’ which language thus appears much closer in proximity to the word ‘previously’ than does the Legislature’s earlier reference to the commencement of ‘[a]n action.’”
According to the Court of Appeals, plaintiff’s argument that any payment made by an insurer would revive a stale claim, no matter how much time had passed, would render an “absurd result” by potentially allowing decades-old claims to be asserted.
Regarding the allegation that, even if the limitations period barred his claim, defendant waived the one-year-back defense by not asserting it in its first responsive pleading, the Court of Appeals said:
“Given the trial court’s discretion to simply allow amendment of the pleading, and in the interest of judicial efficiency, we see no need to remand the case for the trial court to do just that. Accordingly, we conclude that defendant did not waive the affirmative defense of the statute of limitations.”
In a separate dissenting opinion, Judge Servitto said defendant waived the statute of limitations defense because it did not assert the defense in its first responsive pleading.
