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Watkins v Thomas; (ICC-UNP, 2/16/1979; RB #193)


Ingham County Circuit Court; Docket No. 78-21816-NI; Unpublished   
Judge Robert Holmes Bell   
Official Reporter Citation: Not Applicable; Link to Opinion alt   

Specific Exclusions from Motor Vehicle Definition [§3101(2)(e)]
General Rule of Priority [§3125]
12% Interest Penalty on Overdue Benefits – Nature and Scope [§3142(2), (3)]

Not Applicable   

In what appears to be a case of first impression, Ingham County Circuit Court Judge Robert Holmes Bell held in a written Opinion that a motorcycle was not a "motor vehicle" within the meaning of the no-fault statute, and accordingly, plaintiff was entitled to recover for property damage to his motorcycle under the property protection insurance benefits section of the act. Under the priority provisions of §3125, a person suffering property protection damage shall claim property protection insurance benefits first from insurers of owners or registrants of the vehicles involved in the accident, and second from insurers of operators of vehicles involved in the accident. Because Judge Bell held that the Legislature used the terms "vehicles" and "motor vehicles" interchangeably, the plaintiff was permitted to recover his property protection benefits from the insurer of the motor vehicle automobile which inflicted the damage to plaintiff’s motorcycle.

Judge Bell also ruled that pursuant to §3142 of the act, the plaintiff should be awarded interest on the overdue property protection benefits at the rate of 12 percent annum from the date reasonable proof of the fact and the amount of the loss had been supplied to the defendant insurance company — the insurer of the only "motor vehicle" involved in the accident. Judge Bell further found that the defendant insurance company's refusal to pay for the damage to the motorcycle under the property protection insurance benefits sections of the act, after demand for same had been made and proof had been supplied, constituted an unreasonable refusal to pay, which entitled plaintiff to an award of reasonable attorney fees under §3148 of the act. Judge Bell awarded attorney fees in the approximate amount of 40 percent of the overdue property protection benefits.

Finally, Judge Bell held that defendant insurance company has not permitted to deduct from its obligation to provide property protection benefits, an amount equal to personal insurance protection benefits that the defendant insurance company had paid to plaintiff, which PIP benefits should have been paid by another no-fault carrier. The Court noted that such a setoff was not cognizable under general subrogation principles in that the insurance company claiming the setoff was not voluntarily acting to discharge the doubt of another. If the instant insurance company seeks repayment of those erroneously paid benefits, it must seek such reimbursement from the party ultimately found liable to plaintiff, not by way of setoff against plaintiff.

Finally, Judge Bell ordered that plaintiff’s own no-fault insurance company must pay plaintiff the statutory 12 percent interest and a reasonable attorney fee where that insurance company defendant withheld personal insurance protection benefits from plaintiff on the basis of an alleged conflict in Court of Appeals decisions regarding PIP payment priority. On the eve of the motion, this insurance company voluntarily paid the benefits but Judge Bell held they should also pay the statutory interest and attorney fee in light of the fact that the benefits were overdue and the withholding was unreasonable.

Michigan auto accident attorney Stephen Sinas is the lead editor of the appellate case summaries published on this site regarding the Michigan auto insurance law. To learn more about how Stephen Sinas and how the Sinas Dramis Law Firm can help you if you have been injured in a Michigan auto accident, visit

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