Grange Insurance Company of Michigan v. Benteler Automotive Corp
331082
| Mich. Ct. App. | Jun 22, 2017Background
- Single-vehicle rollover: a 2001 Ford Windstar allegedly suffered an axle defect, causing a rollover that injured Kiara and Hannah Achenbach (passengers).
- Grange Insurance (subrogee of Kyle Achenbach and insurer for Kiara/Hannah) paid over $340,000 in PIP benefits and sought further PIP payments.
- Grange sued Benteler Automotive (axle manufacturer) and Ford Motor Company (vehicle maker) for negligence, breach of warranties, and MCPA violations to recover PIP payments by subrogation.
- Defendants moved for summary disposition under MCR 2.116(C)(8), arguing MCL 500.3116 bars recovery for PIP-related subrogation except in limited circumstances.
- Trial court granted summary disposition; Court of Appeals reviewed de novo and affirmed, holding § 3116(2) prevented Grange’s claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MCL 500.3116 bars a no-fault insurer’s subrogation against non-motorist/tort product defendants for PIP-paid benefits | Grange: § 3116 applies only to liens on an insured’s third-party recovery; as subrogee standing in insured’s shoes, § 3116 does not bar its suit | Defendants: § 3116(2) limits subtraction/reimbursement to three situations (out‑of‑state accidents, uninsured motorist, intentional tort); this case is none of them, so recovery is barred | Affirmed: § 3116(2) bars recovery—subrogation claims fall within statute’s prohibition unless one of the three exceptions applies |
| Whether precedent (Tuttle/Pezzani) allows recovery against non-motorist tortfeasors that duplicate PIP benefits | Grange: Tuttle suggests non-motorist liability may permit recovery; Velazquez supports subrogation where insured could have sought duplicative damages | Defendants: Pezzani (On Remand) and other authority interpret § 3116 to bar reimbursement from non-motorist/product tortfeasors | Held: Tuttle’s related language is dicta; Pezzani (On Remand) is binding and supports barring subrogation here |
| Whether the insureds’ choice not to request duplicative damages defeats insurer’s subrogation | Grange: As subrogee, insurer steps into insured’s rights and may pursue damages the insured could have sought (Velazquez) | Defendants: Even if insured could have claimed duplicative damages, § 3116(2) still limits reimbursement to the three enumerated categories | Held: Even if duplicative damages could have been sought, § 3116(2) prevents reimbursement here because none of the statutory exceptions apply |
| Whether other defenses (collateral source rule) preclude recovery | Grange: not dispositive to § 3116 question on appeal | Defendants: collateral source rule also argued as a bar (not reached) | Held: Court did not address collateral source argument because § 3116(2) independently bars recovery |
Key Cases Cited
- United States Fidelity & Guaranty Co v Michigan Catastrophic Claims Ass'n, 484 Mich 1 (2009) (interpret statutes by plain meaning)
- Maiden v Rozwood, 461 Mich 109 (1999) (C(8) standard: accept well-pleaded facts as true)
- Beaudrie v Henderson, 465 Mich 124 (2001) (de novo review of summary disposition)
- Citizens Ins Co v Tuttle, 411 Mich 536 (1981) (discusses limits on subtraction/reimbursement; portions treated as dicta)
- Citizens Ins Co v Pezzani & Reid Equip Co, Inc (On Remand), 202 Mich App 278 (1993) (no-fault insurer’s subrogation barred by § 3116 when none of statutory exceptions apply)
- State Auto Ins Co v Velazquez, 266 Mich App 726 (2005) (subrogee stands in insured’s shoes; insurer may pursue damages duplicative of PIP if insured could have sought them)
- Great American Ins Co v Queen, 410 Mich 73 (1980) (discusses insurer lien/reimbursement under § 3116)