Michigan Court of Appeals; Docket # 326788; Unpublished
Judges Markey, Owens and Boonstra; Unanimous, Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Allowable Expenses for Attendant Care [§3107(1)(a)]
Insurer’s Right to Penalty Attorney Fees for Fraudulent/Excessive Claims [§3148(2)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion, the Court of Appeals affirmed a $13,475 attorney fee award for defendant insurance company pursuant to MCL 500.3148(2), because the trial court properly found that plaintiff’s claim for attendant-care benefits and replacement services was excessive and fraudulent in some respects.
Plaintiff claimed he was struck by a car at a car wash. Defendant Auto Owners was plaintiff’s no-fault insurer and initially paid some PIP benefits, but later refused to pay any more benefits. Plaintiff filed suit and, at trial, the person who provided plaintiff’s attendant care and replacement services, Judy Petroskey, testified that she did not provide services or did not provide 12 hours’ worth of services for many of the days for which replacement services and attendant-care costs were claimed. Petroskey also admitted there were “a lot of days” where she did not see plaintiff, although she testified she was nearby if plaintiff needed help. Jason Williams, defendant’s claims adjuster, testified that video surveillance showed plaintiff driving a tractor and operating a motor vehicle, despite his claim that his injury had rendered him unable to drive. Two private detectives also testified that video surveillance had recorded plaintiff operating a tractor, as well as walking and socializing with others. The jury returned a verdict finding that plaintiff was injured, but that his injury did not arise of out the ownership, operation, maintenance or use of a motor vehicle. The trial court entered a judgment of no cause of action. Defendant later sought costs, including attorney fees pursuant to MCL 500.3148(2). The trial court concluded that defendant was entitled to attorney fees, finding that one-third of the requested $40,000 was a reasonable amount.
The Court of Appeals affirmed the attorney fee award, rejecting plaintiff’s argument that the trial court erred in finding his claims were excessive and fraudulent in some respects.
Citing §3148(2), the Court of Appeals noted an award of fees need not be based on the jury’s verdict, but may be based on fraud alone, on excessiveness alone or a combination of both. In so finding, the Court said:
“[A]lthough all medical providers did testify that plaintiff was injured and that they did not find him to be malingering (and indeed the jury found that he was injured), the trial court found that plaintiff had exaggerated his need for attendant care, at least in some respects, when he filed claims for 12 hours of attendant care on days when according to the video surveillance he was able to carry on the activities of normal life. The fact that a plaintiff has injuries and needs some level of attendant care services does not preclude a finding that a claim for benefits was in some respect fraudulent or so excessive as to have no reasonable foundation under MCL 500.3148(2), especially when there is a dispute over whether such services were actually performed.”
The Court of Appeals further said it was undisputed that Petroskey signed – and plaintiff submitted to defendant – forms that indicated Petroskey had performed attendant care for 12 hours each day on days when she did not do so. While plaintiff claimed these were “minor errors” and “most” of the forms were accurate, the Court pointed out the misrepresentations consisted of “much more than a few days out of a year.”
Based on the foregoing, the Court of Appeals concluded:
“Here, it is clear that plaintiff either knowingly or recklessly claimed attendant care and replacement services on days where he could not have reasonably believed that he had received such care and services, intending that defendant pay benefits relating to those services. Plaintiff’s claims for attendant care and replacement services could properly be considered ‘so excessive as to have no reasonable foundation’ by virtue of the fact that, despite claiming that he needed 12 hours per day of attendant care, he was shown on video operating a tractor, mowing his lawn, and socializing and moving unhindered, and additionally was able to go deer hunting and even assist Petroskey in her surgical recovery. … They could also properly be considered ‘in some respect fraudulent,’ as plaintiff either knowingly or recklessly submitted claims for attendant care and replacement services on days when Petroskey admitted that she did not provide such care and services. … In sum, the trial court did not clearly err in concluding that plaintiff’s claims for attendant care and replacement services were either excessive or in some respect fraudulent, or a combination of both, under MCL 500.3148(2).”
