Allstate Insurance Co v. State Farm Mutual Automobile Insurance Co
321 Mich. App. 543
Mich. Ct. App.2017Background
- Pedestrian Amanda Pettaway was struck on October 31, 2012; she sought PIP benefits through the Michigan assigned claims plan and her claim was assigned to Allstate (plaintiff).
- Allstate paid PIP benefits and later sued the at-fault driver, Lorenzo Causey, in November 2014 to recover under MCL 500.3177; Causey’s counsel later revealed Causey was insured by State Farm (defendant).
- Allstate amended its complaint (May 2015) to add State Farm and sought reimbursement of all no-fault benefits it paid on Pettaway’s behalf (~$40,974.42).
- State Farm moved for summary disposition arguing Allstate’s suit was time-barred under MCL 500.3175(3) because the amended complaint was filed more than two years after assignment and that reimbursements already made by State Farm covered the relevant one-year period.
- Trial court granted State Farm’s motion and denied Allstate relief, relying on precedent and construing the one-year provision to limit recoverable payments; Allstate appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether payments made to medical providers “on behalf of” the claimant count as "payments to the claimant" under MCL 500.3175(3) | Payments to providers are payments "to the claimant" because insurers may pay providers on the injured person’s behalf under MCL 500.3112, so the one-year rule was satisfied by Allstate’s August 2014 payments | The one-year trigger should be read narrowly and only payments directly to the claimant or reimbursements within that year matter; defendant had already reimbursed payments within the year | Court held payments to providers on the claimant’s behalf qualify as payments "to the claimant," so Allstate’s May 2015 suit was timely because it was within one year of its last payment on Pettaway’s behalf |
| Whether an assigned-claims insurer filing within the MCL 500.3175(3) window may recover all no-fault benefits it paid (or only those paid within one year before suit) | An assigned insurer timely under MCL 500.3175(3) may recover full reimbursement for all benefits it paid on behalf of the claimant; the statute is a limitations provision only and does not limit recoverable damages | Where the suit is filed more than two years after assignment, reimbursement should be limited to payments made within the one-year lookback period before suit | Court held MCL 500.3175(3) is a statute of limitations only and does not restrict recovery to benefits paid within one year; Allstate may recover all no-fault benefits it paid for which State Farm was responsible |
| Whether tolling (fraudulent concealment) needed resolution to decide timeliness | Allstate asserted Causey fraudulently concealed his insurer and thus limitations should be tolled | State Farm argued timeliness could be resolved based on payments and no tolling proof was presented | Court found tolling unnecessary to its decision and declined to address it because it resolved timeliness under MCL 500.3175(3) in Allstate’s favor |
| Proper disposition on summary-judgment motions | Allstate argued it was entitled to judgment under MCR 2.116(I)(2) as a matter of law | State Farm argued summary disposition for defendant was proper under MCR 2.116(C)(7) and (C)(10) | Court reversed trial court and held the trial court should have granted Allstate judgment under MCR 2.116(I)(2) because the reimbursement action was timely and Allstate was entitled to full reimbursement |
Key Cases Cited
- Allstate Ins. Co. v. Faulhaber, 157 Mich. App. 164 (discussed prior treatment of when last payment to claimant occurs)
- Allen v. Farm Bureau Ins. Co., 210 Mich. App. 593 (recognized MCL 500.3175 as the limitations provision governing assigned-claims insurers’ reimbursement actions)
- Maiden v. Rozwood, 461 Mich. 109 (procedure and evidentiary principles for summary-disposition motions)
- Hill v. Aetna Life & Cas. Co., 79 Mich. App. 725 (purpose of no-fault act: ensure compensation for automobile accident injuries)