Michigan Court of Appeals; Docket #279909; Unpublished
Judges Cavanagh, Fort Hood, and Davis; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
One-Year Back Rule Limitation [3145(1)]
Tolling of Limitations for Misrepresentation / Fraud [3145]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals affirmed a jury verdict on plaintiff’s claim for unpaid attendant care benefits, finding that the trial court properly exercised its equitable powers to circumvent application of the one-year-back rule under MCL 500.3145(1) where defendant failed to advise plaintiff’s family members of available benefits.
In affirming, the Court of Appeals first noted that despite defendant’s assertion, a claim for fraud is available in the context of an action for no-fault PIP benefits. In so finding, the court explained that in Devillers v Auto Club Insurance Association, 473 Mich 562; 702 NW2d 539 (2005), the Michigan Supreme Court held that where there are unusual circumstances involving fraud in the state, a court can invoke its equitable powers and allow an action for PIP benefits to proceed despite the one-year-back rule. Moreover, in Cooper v Auto Club Insurance Association, 481 Mich 399; 751 NW2d 443 (2008), the court expressly stated that an action for fraud can be maintained. In this regard, the court stated:
“[D]efendant’s contention that a fraud claim may not be maintained where the underlying misconduct arises from a no-fault action is simply without merit. The Devillers Court held that unusual circumstances, including fraud and mutual mistake, would allow a court to invoke its equitable powers to allow a cause of action to proceed, . . . and the Cooper Court expressly held that a fraud action could be maintained.”
In addition, the court rejected defendants’ argument that plaintiff failed to establish an equitable estoppel claim because there is no statutory provision under the No-Fault Act requiring an insurer to notify an insured of the benefits that are available. In order to show that equitable estoppel exists, a party must prove the following:
“(1) a party induces another party to believe facts through representations, admissions, or silence intentionally or negligently; (2) the other party justifiably relies and operates on the belief; and (3) the other party is prejudiced if the first party is permitted to deny the existence of the facts. . . . To apply equitable estoppel in the insurance context, the insured must establish that the insurer induced a belief through acts, representations, or silence regarding coverage or the lack thereof, the insured justifiably relied on this belief, and the insured was prejudiced as a result of the reliance.”
Moreover, the court stated that although there is no statutory duty for an insurer to notify its insureds of the available benefits, trial testimony established that the claims representative testified that family members of injured insureds should be paid for providing services to the injured person. However, there was no evidence in the claims file that the adjuster ever explained to the plaintiff’s family what benefits were available. Therefore, the court stated, the lack of a statutory duty is irrelevant where it was defendant’s policy to notify family members regarding available benefits. In this regard, the court also stated:
“Defendant contends that a claim for equitable estoppel fails because a no-fault insurer has no obligation as a matter of law to advise a claimant regarding the benefits available. Regardless of the provisions of the no-fault act, the testimony at trial revealed that defendant did have such an obligation. Specifically, the claims representative for defendant, Arvilla Woods, testified that, irrespective of whether the insured was represented by counsel or not, the family of an insured should be paid for providing services, and there was no record evidence in the claims file that she notified plaintiff’s family or counsel of the entitlement to benefits for services rendered. Thus, the lack of a statutory obligation is irrelevant where Woods testified that defendant’s policies and procedures involved providing family members with notice of the benefits available and making payment for those benefits when the family rendered services. Therefore, this challenge to the equitable estoppel claim is without merit.”
