Michigan Court of Appeals; Docket #278856; Unpublished
Judges Wilder, Jansen, and Owens; 2-1 (Wilder dissenting); per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
Requirement That Benefits Were Unreasonably Delayed or Denied [3148(1)]
Presumption of Unreasonableness [3148]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this 2-1 unpublished per curiam opinion, the Court of Appeals affirmed a $95,000 attorney fee award under MCL 500.3148(1), finding that the 10-month delay before defendant began to investigate plaintiff’s claim for personal injury protection benefits was unreasonable and, therefore, attorney fees were proper.
The plaintiff in this case injured his back in a motor vehicle accident and sought personal injury protection benefits from defendant. Defendant failed to pay for plaintiff’s treatment and plaintiff was forced to file this action. After a jury found for plaintiff, the trial court awarded plaintiff attorney fees in the amount of $95,000 under §3148(1), finding that defendant’s delay in making payment was unreasonable. An attorney is entitled to attorney fees under §3148(1) for representing the claimant in a PIP action where benefits are overdue and the court finds that the insurer unreasonably refused to pay the claim.
In affirming, the Court of Appeals rejected defendant’s argument that its delay in paying for plaintiff’s treatment was reasonable, because plaintiff had pre-existing back problems. In finding for plaintiff, the court noted that defendant did not order plaintiff’s medical records until 30 days after it received notice of plaintiff’s injury and, once it received the records, failed to examine them in a timely manner. In addition, at the time defendant received the medical records, there was uncontroverted evidence that plaintiff had incurred additional injuries to his back. Moreover, it was 10 months before defendant had plaintiff examined by its own doctor. Therefore, the court concluded, considering that there were multiple uncontradicted reports showing that plaintiff sustained a new injury in the motor vehicle accident, defendant had more than reasonable proof of plaintiff’s claim and the trial court properly found that its delay in payment was unreasonable. In this regard, the court stated:
“In sum, for the ten months before defendant had plaintiff examined by its own doctor, all of the existing medical evidence indicated that it was more probable than not that plaintiff’s new herniation had been caused by the automobile accident. Given the multiple, uncontradicted reports indicating that the new injury had been caused by the accident, we conclude that defendant had more than reasonable proof to support plaintiff’s claim. . . .
In light of defendant’s unreasonable delay in attempting to obtain plaintiff’s records, the unanimous opinion of the initial treating physicians that it was more probable than not that the new herniation was caused by the accident, and the untimely and ambiguous report of defendant’s physician, the trial court properly determined that the insurer’s initial refusal to pay was unreasonable. . . . We cannot conclude that the trial court clearly erred by finding that defendant’s refusal to timely pay plaintiff’s claim was unreasonable or by awarding attorney fees under the no-fault act. . . .”
Moreover, the court found that under the factors outlined in Wood v DAIIE, 413 Mich 573; 321 NW2d 653 (1982), the amount awarded was reasonable, even though plaintiff was only awarded $20,000 in unpaid benefits. Furthermore, there was no dispute as to the amount of hours plaintiff’s attorney spent on the case or that those hours were necessary. Therefore, the court stated, the only remaining issue involved the $350 hourly rate that plaintiff’s attorney charged. Nevertheless, the court stated that because defendant failed to provide any authority to support its claim that an attorney fee award based on an hourly rate of $350 for an experienced and skilled attorney was excessive, the court found there was no abuse of discretion. In this regard, the court stated:
“Defendant next argues that, even if attorney fees were warranted, the trial court abused its discretion by granting over $95,000 in attorney fees. We disagree. . . .
Under the six Wood factors, it is clear that plaintiff’s attorney was of high professional standing and experience and that he expended a great deal of skill, time, and labor on this case. Defendant argues that the attorney fees granted in this case were disproportionately high because the fees actually awarded greatly exceeded the recovery amount of approximately $20,000. But, as plaintiff points out, that $20,000 amount does not include the cost of a future back operation, which was also awarded to plaintiff, and which plaintiff claims could exceed $50,000. Defendant also makes much of the fact that there was an original contingency fee agreement between plaintiff and his counsel. But as noted above, the existence of a contingency fee agreement is not itself dispositive when calculating reasonable attorney fees under the no-fault act. . . .
Because there was no dispute as to the number of hours plaintiff’s attorney spent on this case, or that those hours were necessary, the only issue remaining was the hourly rate charged. Defendant has provided no authority or argument as to why $350 an hour for an experienced and skilled attorney is so high as to be an abuse of discretion. . . . Given the large number of hours worked on this case over several years and the experience and standing of plaintiff’s attorney, we simply cannot say that the amount of attorney fees ultimately awarded for plaintiff in this case constituted an abuse of discretion.”
