Patrice Smith v. Auto-Owners Insurance Company
329270
Mich. Ct. App.Feb 21, 2017Background
- Plaintiffs Patrice Smith and Alean Lewis sued Auto-Owners under Michigan’s no-fault statute seeking PIP benefits; case tried to a jury over five days.
- Defendant moved for JNOV after a jury verdict for plaintiffs, arguing plaintiffs engaged in fraud (policy-application discrepancies, surveillance showing plaintiffs performing tasks they claimed required replacement services).
- Surveillance showed Smith performing limited activities (driving slowly, shopping, taking children to errands, visiting medical facility); Smith’s replacement-services forms claimed help with household tasks and childcare, not driving/shopping.
- Defendant also challenged admission of medical billing records and reasonableness of charges (including a provider, Dr. Iskander, who did not produce wholesale-cost documents).
- Trial court admitted billing testimony from clinic billing staff about customary rates and allowed Dr. Iskander’s deposition to be played; jury found no fraud and awarded benefits.
- Court of Appeals affirmed: denial of JNOV proper, evidentiary rulings within discretion, and no reversible error on deposition admission.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether JNOV was required because fraud was established as a matter of law | Smith/Lewis: surveillance and discrepancies do not conclusively prove fraud; credibility and explanations create factual disputes | Auto-Owners: application discrepancies and surveillance show plaintiffs performed tasks for which they claimed replacement services, establishing fraud | Denied — JNOV not warranted; evidence construed for plaintiffs and reasonable jurors could differ, so verdict stands |
| Whether surveillance evidence (and Bahri) mandates finding fraud as matter of law | Plaintiffs: surveillance does not contradict the specific assistance claimed (household tasks/childcare) and testimony explains apparent inconsistencies | Auto-Owners: Bahri controls — surveillance showing able performance of tasks claimed requires finding fraud | Court distinguishes Bahri (summary-disposition context and clearer inconsistencies) and finds surveillance here did not conclusively establish fraud |
| Whether admission of medical bills and testimony on reasonableness was improper | Plaintiffs: billing staff testimony on customary charges sufficed to let jury decide reasonableness | Auto-Owners: provider failed to show wholesale costs; Bronson requires such proof or otherwise excludes bills | Admissible — reasonableness is a jury question; Bronson does not limit plaintiffs to wholesale-cost proof and billing witnesses provided customary-rate evidence |
| Whether playing Dr. Iskander’s video deposition was abuse of discretion due to nonproduction of cost records | Plaintiffs: deposition admissible; the doctor was not a party and court cannot sanction nonparty for subpoena noncompliance | Auto-Owners: nonproduction undermined fairness; deposition should be excluded | Not preserved for review on this specific argument; in any event court sees no error — doctor was nonparty and sanctions against plaintiffs were not warranted |
Key Cases Cited
- Hecht v. Nat’l Heritage Academies, Inc., 499 Mich. 586 (credibility and JNOV review — view evidence in nonmoving party’s favor)
- Bahri v. IDS Prop. Cas. Ins. Co., 308 Mich. App. 420 (surveillance evidence supported fraud finding in summary-disposition context)
- Bronson Methodist Hosp. v. Auto-Owners Ins. Co., 295 Mich. App. 431 (defendant may discover wholesale costs for certain durable medical supplies; provider bears burden to show reasonableness)
- Advocacy Org. for Patients & Providers v. Auto Club Ins. Ass’n, 257 Mich. App. 365 (methodology for assessing reasonableness of provider charges)
- Dell v. Citizens Ins. Co. of Am., 312 Mich. App. 734 (standard of review for JNOV)