Ingham County Circuit Court; Docket No. 81-27102-CK and 81-27868-CZ
Judge Jack W. Warren
Official Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Nature of Survivor’s Loss Benefits [§3108(1)]
Calculation of Survivor’s Loss Benefits and Maximums [§3108(1)]
Standards for Deductibility of State and Federal Governmental Benefits [§3109(1)]
Social Security Survivor’s Benefits [§3109(1)]
State Pension Benefits [§3109(1)]
12% Interest Penalty on Overdue Benefits – Nature And Scope [§3142(2), (3)]
Requirement That Benefits Were Unreasonably Delayed or Denied [§3148(1)]
Bona Fide Factual Uncertainty / Statutory Construction Defense [§3148]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
This written Opinion by Judge Warren dealt with a variety of issues arising out of a claim for no-fault survivors' loss benefits. Plaintiff’s husband was a Michigan State Police Trooper who was killed in an off-duty automobile accident. He had been employed as a trooper for approximately 13 years prior to his death. Surviving him was his widow, the plaintiff; their minor son; and his two minor children by a previous marriage. The decedent was required to pay child support in the amount of $35 per week for each of these two children of his first marriage. The major issue in the case was whether or not the defendant no-fault insurer was entitled to deduct from the no-fault survivors' lost benefits it owed plaintiff, the amount of plaintiff’s retirement pension she was receiving from the State Police as a result of the death of her husband. In addition, there was an issue involving the appropriate way to compute the deduction for social security survivors' loss benefits received from the federal government and a further dispute as to the amount of no-fault benefits the children of the previous marriage should receive. As to these issues, Judge Warren made the following rulings.
First, the Court ruled that the State Police retirement pension was not an appropriate governmental benefit which could be subtracted pursuant to the terms of §3109(1) of the Act. The Court held that the State Police pension did not satisfy the case law requirement that a governmental benefit be payable as a result of the same accident and duplicate the no-fault benefits otherwise due. To this effect, Judge Warren held:
"Here the benefit received is a State Police pension payable to a widow of an officer who had served at least ten years. The amount of the pension is computed in the same manner as if the officer had retired effective the day preceding the date of death, and named the spouse as beneficiary. MCLA 28.107(4).
"The no-fault survivors' benefit protects dependents against the loss of a wage earner's support The benefits are payable because the wager earner is no longer working and able to provide the support Conversely, this pension protects a widow from losing the spouse's retirement security. Here the pension benefits are paid to Mrs. Perkins only because her husband is unable to receive them because of his death. The pension is an asset Mr. Perkins was entitled to based on his contributions and his years of service. Mrs. Perkins receives the pension only as his beneficiary.
"Since it is designed to provide protection against a different kind of loss, the pension does not duplicate the no-fault survivors' benefit. Therefore, the Defendant is not entitled to a set-off for the pension benefits received by Mrs. Perkins."
Second, relying upon Thompson v DAIIE (item number 426) Judge Warren held that the defendant insurer was only entitled to deduct the specific amount of social security benefits received by each of the defendants from that defendant's individual share of the no-fault survivors' loss benefits. In this case, the insurer attempted to set-off all social security disability benefits from the total amount of survivors' loss benefits that were due in the aggregate. According to Judge Warren, it was necessary to first determine the amount of no-fault benefits due each dependent, then reduce that amount by the social security benefits received by that dependent.. With regard to computing the individual shares of each dependent, Judge Warren noted that there was no evidence in the record to indicate that the two children from the previous marriage received any more contributions of tangible things of economic value for their support other than the monthly child support payments. Thus, their share of the survivors' loss benefit was computed to be the total amount of the monthly child support payments.
Third, citing Nash v DAIIE, Judge Warren held that the defendant insurer owed 12 percent interest under the no-fault statute without regard to the "reasonableness" of the insurer's legal position.
Fourth, the Court held that plaintiff’s claim for mental anguish damages should be dismissed in spite of the fact that she claimed a "tortious breach of fiduciary duty." The Court held that even though tortious conduct was alleged, the claim itself was based solely on a defendants alleged wrongful failure to pay benefits under the contract In order to recover mental anguish damages; the tortious conduct must be independent from the alleged breach.
Finally, Judge Warren ruled that defendant had not "unreasonably" denied the claim because a legitimate issue of statutory construction was involved. Thus, attorney fees were not awarded under §3148 of the statute.
