Michigan Court of Appeals; Docket # 324847; Published
Judges O'Connell, Markey, and Murray; Unanimous, Per Curiam Opinion by Judge Markey
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Reasonable Proof Requirement [§3142(2)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous published per curiam Opinion written by Judge Markey, the Court of Appeals held:
1) the no-fault insurer was not entitled to additional time to investigate an injured party's eligibility for PIP benefits, and
2) the trial court improperly denied penalty interest under MCL 500.3142, because the insurer paid the claim more than 30 days after receiving "reasonable proof" of loss.
Amber French was injured in a car accident on May 9, 2013. Plaintiff Bronson Health Care Group treated French and submitted a claim for PIP benefits to the Michigan Assigned Claims Plan (MACP), which assigned the claim to defendant Titan Insurance. Titan did not pay the claim within 30 days and plaintiff filed an action to collect benefits. When Titan finally paid the PIP claim in August 2014 (more than a year after the accident), plaintiff sought penalty interest under §3142, as well as attorney fees and costs under MCL 600.2591. However, Titan claimed it was not liable for penalty interest because its investigation into French's eligibility for benefits ended when French was deposed in July 2014, and that it paid the claim within 30 days of this investigation. Relying on this same argument, Titan asserted that plaintiff was also not entitled to attorney fees or costs under §2591. The trial court denied plaintiff's request for penalty interest and attorney fees.
The Court of Appeals reversed, finding §3142 makes it clear that a claim has to be paid within 30 days. In so holding, the Court emphasized that an assigned insurer has never been given extra time beyond the statutory 30 days to conduct its own investigation into a claimant's eligibility for benefits.
In making this ruling, the Court of Appeals rejected Titan's argument that it was not obligated to pay benefits until it was certain that French was eligible to receive those benefits. The Court noted that Michigan's appellate courts have construed §3142 in accordance with its plain language, which requires "reasonable proof of the fact and of the amount of loss sustained," and that courts have not allowed an assigned insurer additional time beyond the statutory 30 days to conduct its own investigation regarding the eligibility of the claimant to receive benefits. In light of this, the Court of Appeals held the trial court erred in finding Titan's position that French might be ineligible for benefits justified its failure to comply with §3142(2) until it conducted enough discovery to satisfy itself that French was, indeed, eligible for benefits.
In making this ruling, the Court of Appeals observed that Titan received documents on September 24, 2013, offering reasonable proof that French was injured in an accident, there were medical bills, and neither she, the driver nor the vehicle's owner had no-fault insurance. The Court noted the trial court made no findings about whether the information provided to Titan qualified as reasonable proof of the fact and amount of a claim, in compliance with §3142(2), and instead the trial court focused on Titan's arguments regarding French's eligibility for benefits. According to the Court of Appeals:
"In doing so, the trial court improperly read a requirement into the statute: that penalty interest was not available until more than 30 days after an assigned carrier confirms for itself and on its own timeline a claimant's eligibility for benefits. Courts cannot read a requirement into a statute that the Legislature has 'seen fit to omit.'"
Based on the foregoing, the Court of Appeals reversed the denial of penalty interest under §3142(2), and remanded for findings regarding when Titan actually received reasonable proof of the fact and the amount of loss sustained, and for a calculation of penalty interest.
In conclusion, the Court of Appeals further held that attorney fees should have been awarded pursuant to §2591 because Titan's defense to penalty interest under §3142 was frivolous.
