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Accident Victims Home Health Care v Allstate Insurance Company; (COA-UNP, 6/6/2006, RB #2750)


Michigan Court of Appeals; Docket #257786; Unpublished
Judges Neff, Saad, and Bandstra; 2-1 (Judge Neff concurring in result only); per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion courthouse graphic

Not applicable

Collateral Estoppel and Res Judicata
Release and Settlements

In this 2-1 unpublished per curiam opinion, the Court or Appeals affirmed summary disposition for defendant Allstate Insurance, finding that a health care provider’s claim for payment of services was previously litigated in an earlier action by the injured party against Allstate.

Allstate’s insured was seriously injured when she was struck by a vehicle while riding her bike. The insured received healthcare services from plaintiff that totaled about $40,000. Allstate paid a portion of its insured’s bills, claiming the unpaid balance was unrelated to the accident. The insured sued Allstate regarding the unpaid bills. The insured and Allstate settled the action for $6,000. As part of the settlement, the insured expressly released defendant from any further liability including any claims by the insured’s health care providers. Plaintiff subsequently sued Allstate for payment. The trial court granted Allstate’s motion for summary disposition finding the insured’s release barred all further actions.

Although the Court of Appeals determined that plaintiff had a right to bring its own action, it nonetheless affirmed, finding plaintiff’s claim was barred by collateral estoppel. The precise issue that plaintiff now seeks to litigate was fully litigated in the prior proceeding. Further, the interests of plaintiff and the insured were sufficiently similar so the earlier litigation provided plaintiff with a forum in which it could have litigated its claim. Therefore, the court determined that Allstate should not be subject to multiple litigation over identical expenses that were fully litigated, settled and dismissed. In this regard, the court reasoned:

In the underlying Gaither case, the parties, Gaither and Allstate, voluntarily dismissed the lawsuit with prejudice after they negotiated and settled the claims. . . . Those claims . . . included past medical expenses that Gaither incurred when she received healthcare services from Accident Victims. . . . Moreover, the precise issue Accident Victims now seeks to litigate was fully litigated in the prior proceeding. . . . We further hold that, here, the interests of Gaither and Accident Victims are sufficiently similar so that the prior litigation afforded Accident Victims a forum to protect its rights under the no-fault act. Thus, for purposes of collateral estoppel, Gaither and Accident Victims were in privity. . . . Under these facts, Allstate should not be subject to multiple litigation over the identical expenses that were fully litigated, settled, and dismissed with prejudice in Gaither. Our decision is also premised on the undisputed fact that Accident Victims was fully aware of the Gaither litigation. . . . Accident Victims clearly could have sought to intervene in Gaither’s case in order to fully protect its own interests in the disputed benefits, but failed to do so.”

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