Michigan Court of Appeals; Docket #312872, #312882; Published
Judges O’Connell, Wilder, and Meter; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
Link to Order
STATUTORY INDEXING:
Security for Payment of Benefits; Definitions [§3101]
Priority Rules for Payment of PIP Benefits [§3114]
When Claimants Can Receive PIP Benefits Through the Assigned Claims Facility [§3172(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous published per curiam Opinion involving an assigned insurer’s right to reimbursement from a higher priority insurer pursuant to MCL 500.3172(1), the Court of Appeals held: 1) the validity of the underlying claim for benefits did not affect the assigned insurer’s right to reimbursement, and as a result 2) the assigned insurer was entitled to reimbursement for the amounts it paid, although an issue of material fact may have existed about whether the insured was actually entitled to benefits.
Defendant Enjoi Transportation, a company that provides non-emergency transportation to the elderly and disabled, drove plaintiff to his dialysis appointments. Plaintiff used a motorized scooter and, during one ride in defendant’s van, plaintiff fell from his scooter and was injured. Plaintiff claimed the scooter was improperly secured in the van, but defendant argued that plaintiff deliberately unlatched the scooter. Plaintiff did not have no-fault insurance and his claim for no-fault coverage was assigned to Farm Bureau, which paid benefits. Farm Bureau then filed a declaratory action, naming American Guarantee as defendant’s insurer and alleging that it was entitled to reimbursement for benefits it paid plaintiff. American Guarantee claimed plaintiff’s injuries were not covered because they did not arise from the use of a “motor vehicle as a motor vehicle” and because the injuries were not accidental. Plaintiff then filed a complaint against defendant, Farm Bureau and American Guarantee, alleging negligence and breach of contract. The two actions were consolidated. The trial court granted summary disposition for Farm Bureau.
Affirming the trial court’s ruling, the Court of Appeals explained that, pursuant to §3172(1), unpaid benefits can be collected under an assigned claims plan and the insurer to which the claim is assigned “is entitled to reimbursement from the defaulting insurers to the extent of their financial responsibility.” The court noted this right is not based on a subrogation theory.
Focusing on the word “reimbursement” in §3172(1), the Court of Appeals said that, given the plain meaning of the word, an assigned claims insurer, like Farm Bureau, is entitled to reimbursement for the expense or loss incurred, “not subject to other limitations that may apply to a direct suit from a claimant.” The court added:
“We emphasize that the assigned claim statutes obligated Farm Bureau, as the servicing insurer, to adjust Williams’s claim. … It did so and is thus entitled to be reimbursed for the amounts paid, even assuming that a genuine issue of material fact existed regarding whether Williams truly was entitled to benefits. … MCL 500.3172(1) indicates that the insurer to which the claim is assigned ‘is entitled to reimbursement from the defaulting insurers to the extent of their financial responsibility.’ In this case, American Guarantee’s ‘financial responsibility’ is necessarily tied to manner in which Farm Bureau, as the initial adjusting insurer, adjusted the claim.”
The Court of Appeals concluded:
“Because American Guarantee admitted that it insured the Enjoi vehicle at the time of the incident, the court properly determined that American Guarantee had priority to pay for Williams’ benefits. The strength of Williams’ underlying claim for no-fault benefits was no longer at issue. Therefore, there was no genuine issue of material fact that Farm Bureau was entitled to reimbursement from American Guarantee, and the trial court correctly granted summary disposition to Farm Bureau.”
