Michigan Court of Appeals; Docket # 326744; Unpublished
Judges Jansen, Fort Hood and Boonstra; Unanimous, Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Fraud/Misrepresentation
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion, the Court of Appeals held that plaintiff's claim for PIP benefits was properly dismissed because video surveillance showed plaintiff driving on the same day he also received transportation services from defendantno-fault insurer, and this constituted fraud under the terms of plaintiff's policy.
Plaintiff, a named insured on a no-fault policy issued by defendant Frankenmuth Mutual, was in an auto accident in 2013. Plaintiff received treatment for the injuries he allegedly sustained. Plaintiff's treating physician, Dr. Beale, instructed plaintiff not to drive for about a six-month period after the accident. Plaintiff filed for PIP benefits from Frankenmuth, including payment for transportation services. Frankenmuth denied plaintiff's claim, and plaintiff filed suit. At his deposition, plaintiff denied driving at any time during the six-month period in which he had been told by Dr. Beale not to operate a vehicle. However, surveillance video showed plaintiff driving on two separate occasions, while also using non-emergency medical transportation on that same day. Frankenmuth moved for summary disposition, arguing the fraud exclusion in plaintiff's no-fault policy barred his claim for PIP benefits. The fraud exclusion provided: "We do not provide coverage for any 'insured' who has made fraudulent statements or engaged in fraudulent conduct in connection with any accident or loss for which coverage is sought under this policy." According to Frankenmuth, the surveillance video, along with plaintiff's deposition testimony, were evidence of fraudulent conduct because a large portion of plaintiff's claimed PIP benefits were for transportation costs. Plaintiff responded that Frankenmuth did not establish fraud. The trial court granted Frankenmuth's motion for summary disposition and dismissed plaintiff's PIP claim, finding that plaintiff had engaged in fraud.
The Court of Appeals affirmed, relying on Bahri v IDS Property Casualty Ins Co, 308 Mich App 420 (2014). According to the Court, Bahri presented facts similar to the present case and the fraud exclusion in Bahri was identical to the exclusion in this case.
In Bahri, the Court of Appeals held the surveillance video evidence in that case "directly and specifically" contradicted representations made by plaintiff, who was seeking replacement services. The Bahri panel held that reasonable minds could not differ about whether plaintiff had made fraudulent representations of material fact for purposes of receiving PIP benefits.
According to the Court of Appeals, Bahri compelled the same conclusion in this case. The Court observed:
"Plaintiff's claim for PIP benefits involves, in large part, a claim for transportation services due to his purported inability to drive. Yet plaintiff was observed driving his car multiple times on the same day he availed himself of medical transportation services. Further, when offered a chance to perhaps explain why he drove on that particular day, plaintiff instead represented multiple times that he had not driven at all during the relevant time period. These representations were thus 'reasonably relevant to the insurer's investigation of a claim.'"
The Court of Appeals also found "unavailing" plaintiff's argument that Bahri was distinguishable from this case because it partially involved claims for replacement services that had not actually been provided. The Court observed:
"The Bahri Court specifically noted that the surveillance belied the plaintiff's assertion that she needed help with the tasks she was observed performing without help, including revealing that she was driving on a day that she stated that she required transportation assistance. ... The fact that plaintiff in this case in fact actually availed himself of transportation services on the day he was observed does not defeat the fact that he was observed performing an activity 'inconsistent with [his] claimed limitations' on a day that he asserted he required transportation."
The Court of Appeals further found "unpersuasive" plaintiff's argument that his assertions during deposition that he did not drive were "innocent mistakes." The Court concluded:
"If they were not knowing misrepresentations, then they were certainly reckless ones, in the face of the proof that he drove his car at least twice on the same day he availed himself of transportation services."
Based on the foregoing, the Court of Appeals affirmed summary disposition for Frankenmuth and dismissed plaintiff's PIP benefit claim.
