Michigan Court of Appeals; Docket #321112; Unpublished
Judges Ronayne Krause, Gleicher, and Stephens; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
One-Year Notice Rule Limitation [§3145(1)]
One-Year Back Rule Limitation [§3145(1)]
Effect of Payment on Notice Requirement [§3145(1)]
Required Content of Notice / Sufficiency of Notice [§3145(1)]
Obligation of the Assigned Claims Insurer to Preserve and Enforce Indemnity or Reimbursement Rights Against Third Parties [§3175(2)]
Time Limitations Applicable to Enforcing Indemnity or Reimbursement Rights Against Third Parties [§3175(3)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion, the Court of Appeals held that a second-party insurer could not seek reimbursement for benefits that a first-party insurer should have paid, because the second-party insurer did not provide notice to the first-party insurer within one year of the insured’s accident, as required by MCL 500.3145.
Plaintiff Titan Insurance was assigned by the Michigan Assigned Claims Plan (MACP) on August 23, 2010, to handle the no-fault claim of Matthew Sterling, who was seriously burned while starting an uninsured vehicle owned by Frank Ward. Titan paid benefits, but later learned that defendant State Farm insured another vehicle owned by Ward, which it claimed made State Farm higher in priority for benefits. On August 23, 2012, Titan brought an action against State Farm for reimbursement pursuant to MCL 500.3175(2) and MCL 500.3175(3). Meanwhile, in March 2011, State Farm (the insurer of the other vehicle owned by Ward) had sent two letters to defendant Affirmative Insurance, requesting confirmation that Sterling’s no-fault policy with Affirmative “was active on the date of the accident 6/30/2010 …,” after learning that Affirmative had paid an emergency room charge related to Sterling’s injuries in August 2011. On March 27, 2013, State Farm filed a third-party claim against Affirmative, alleging that Affirmative was higher in priority than State Farm for paying benefits.
Titan, State Farm, and Affirmative all moved for summary disposition. Affirmative argued that State Farm’s claim was time-barred by §3145(1). However, State Farm asserted that it provided notice to Affirmative within one year of the accident; Affirmative’s 2011 payment tolled the statute of limitations; and State Farm had not yet incurred any expense.
The trial court granted summary disposition to Titan and entered a judgment in the amount of $45,664.27 against State Farm. It also granted State Farm summary disposition and entered judgment in the amount of $45,664.27 against Affirmative. The trial court concluded that §3145(1) did not bar State Farm’s claim for reimbursement against Affirmative because State Farm only “incurred” an expense related to Sterling’s no-fault claim on the day of the hearing, when Titan obtained judgment against State Farm.
The Court of Appeals held that State Farm’s reimbursement claim was time barred by §3145 because State Farm, standing in the shoes of the injured claimant, did not provide the requisite notice. In so holding, the Court of Appeals said:
“The ‘notice’ demanded by the No-Fault Act must include ‘the name and address of the claimant and indicate in ordinary language the name of the person injured and the time, place and nature of his injury.’ … State Farm’s letters omitted Sterling’s address and presented no information whatsoever regarding the place or the nature of Sterling’s injury. State Farm urges that despite these obvious deficiencies Dozier v State Farm Mut Automobile Ins Co, 95 Mich App 121 … (1980), allows that ‘substantial compliance’ was all that was required. … But given the Supreme Court’s more recent opinions in notice cases …, we doubt that Dozier would withstand textual scrutiny. We need not enter those waters, as in Dozier the defendant insurer ‘waive[d] its right to assert the insufficiency of the notice’ by acknowledging receipt of the letter and requesting additional information. These facts readily distinguish Dozier from this case. Because State Farm’s letters to Affirmative lacked any basic information regarding the place or the nature of Sterling’s injuries, we reject that State Farm substantially complied with MCL 500.3145(1).”
The Court of Appeals further rejected State Farm’s argument that Affirmative’s payment of Sterling’s emergency room bill entitled it to bring a reimbursement action. In this regard, the court relied on Jesperson v Auto Club Ins Ass’n, 306 Mich App 632 (2014), and said:
“In Jesperson …, this Court held that only a payment made within the first year after a claimant’s accident triggers the second statutory exception, which permits filing a lawsuit more than one year after the accident when ‘the insurer has previously made a payment of personal protection insurance benefits for the injury.’ … Affirmative’s payment was made more than one year after Sterling’s accident. We note that our Supreme Court has granted leave to appeal in Jesperson .… The Supreme Court’s order granting leave does not diminish Jesperson’s precedential effect.”
In conclusion, the Court of Appeals remanded for entry of an order granting Affirmative’s cross-motion for summary disposition against State Farm, and vacated the trial court’s judgment of $45,664.27 to State Farm against Affirmative.
