O Oliver Ravenell v. Auto Club Insurance Association ( 2022 )

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
OLIVER RAVENELL, UNPUBLISHED
January 27, 2022
Plaintiff,
and
NGM INSURANCE COMPANY,
Plaintiff-Appellee,
v No. 348436
Wayne Circuit Court
AUTO CLUB INSURANCE ASSOCIATION, LC Nos. 17-009231-NF;
16-006161-NF
Defendant-Appellant.
ON REMAND
Before: SWARTZLE, P.J., and JANSEN and BORRELLO, JJ.
PER CURIAM.
This case returns to us on remand for reconsideration of our earlier opinion, Ravenell v
NGM Insurance Co, unpublished per curiam opinion of the Court of Appeals, issued October 15,
2020 (Docket No. 348436), vacated by Ravenell v NGM Insurance Co, ___ Mich ___ (2021)
(Docket No. 162281), in light of Esurance Prop & Cas Ins Co v Mich Assigned Claims Plan, ___
Mich ___; ___ NW2d ___ (2021) (Docket No. 160592), by order of our Supreme Court, Ravenell
v NGM Insurance Co, ___ Mich ___ (2021) (Docket No. 162281). After reviewing Esurance, we
conclude that plaintiff, NGM Insurance, is entitled to compensation from defendant, Auto Club
Insurance Association (ACIA), due to equitable subrogation. Thus, we affirm the trial court’s
orders granting summary disposition to NGM and denying ACIA’s motion for summary
disposition.
I. BACKGROUND
We previously stated the relevant facts of this case in Ravenell, unpub op at 1-3:
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On November 6, 2014, Oliver Ravenell was struck by a car being driven by
Thaddeus Stec. Ravenell filed a claim for personal-injury-protection (PIP) benefits
with NGM, which was the commercial-automobile insurer of three vehicles listed
on a policy issued by NGM to Omega Appraisals, LLC, a company for which
Ravenell’s wife was the resident agent. Ravenell also filed a bodily-injury claim
for threshold damages with ACIA, Stec’s auto-insurance carrier.
NGM paid in excess of $331,000 in PIP benefits to and on behalf of
Ravenell. Eventually, however, NGM took the position that Ravenell was not
covered by the policy that it issued to Omega because neither Ravenell nor his wife
were listed in the policy as named insureds. NGM further took the position that
ACIA, as Stec’s insurer, was responsible for paying PIP benefits to Ravenell. NGM
filed this lawsuit against ACIA, seeking reimbursement of the PIP benefits that it
paid to Ravenell. NGM styled its complaint as one for “reimbursement,
indemnification, and declaratory relief.” The complaint contained two counts.
NGM labeled the first count as “Defendant, ACIA, is the Sole Insurer in the Orders
of Priority,” and labeled the second count as unjust enrichment. NGM alleged that
ACIA was required to pay Ravenell’s PIP benefits because it was the only auto
insurer in the orders of priority, and that ACIA “owes NGM in excess of
$331,000.00.”
Ravenell then filed a lawsuit against ACIA for PIP benefits, and the two
lawsuits were consolidated in the trial court. After discovery, NGM filed a motion
under MCR 2.116(C)(10), seeking partial summary disposition regarding liability.
In that motion, NGM argued that it was never liable to pay PIP benefits to Ravenell
under the no-fault act, [MCL 500.3101 et seq.,] and that ACIA was the only auto-
insurer that was liable to pay those PIP benefits. Therefore, NGM asked the trial
court to find that ACIA was “the insurer highest in the orders of priority to pay no-
fault benefits” to Ravenell.
ACIA responded by arguing that NGM was not entitled to partial summary
disposition and that the trial court should instead grant summary disposition in its
favor under MCR 2.116(I)(2). ACIA first argued that NGM’s claim was barred by
the one-year statute of limitations set forth in MCL 500.3145(1) because NGM did
not file suit within one year after the accident, and did not provide ACIA notice
within that first year. In addition, ACIA argued that NGM’s action was “an
attempted subrogation claim, by which NGM purports to stand in the shoes of
Ravenell [and] seek benefits” from ACIA. Furthermore, ACIA argued that NGM’s
subrogation claim failed because it had no contractual or statutory obligation to pay
PIP benefits to Ravenell, and it therefore paid those benefits as a “mere volunteer.”
In support of this argument, ACIA relied on [Amerisure Cos v State Farm Mut Auto
Ins Co, 222 Mich App 97, 102-103; 564 NW2d 65 (1997)], and [Titan Ins Co v
North Pointe Ins Co, 270 Mich App 339, 343-344; 715 NW2d 324 (2006)].
Although NGM did not mention its unjust-enrichment claim in its motion
for partial summary disposition, ACIA addressed the claim briefly in a footnote in
its brief opposing that motion. Citing Bellevue Ventures, Inc v Morang-Kelly Inv,
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Inc, 302 Mich App 59, 64; 836 NW2d 898 (2013), ACIA argued that, to be viable,
an unjust-enrichment claim requires that the defendant received a benefit from the
plaintiff. ACIA argued that only Ravenell received something from NGM, but that
ACIA did not. ACIA argued that it could not retain something that it never
received, and that NGM’s unjust-enrichment claim therefore failed as a matter of
law.
At the hearing on NGM’s motion for partial summary disposition, the trial
court ruled that ACIA was first in line of priority under MCL 500.3115 and that it
received proper notice within one year of the accident. The trial court did not
address ACIA’s arguments regarding subrogation, and did not address NGM’s
unjust-enrichment claim. The trial court granted NGM’s motion for partial
summary disposition and denied ACIA’s request for summary disposition under
MCR 2.116(I)(2). NGM subsequently moved for summary disposition under MCR
2.116(C)(10), regarding the amount of damages, and the trial court granted that
motion. The trial court subsequently entered a judgment against ACIA in the
amount of $182,112.64. [Footnote omitted; second alteration in original.]
On appeal, we reversed the trial court’s orders and remanded for proceedings consistent
with our opinion. Id. at 8. In doing so, we concluded that NGM presented a claim for equitable
subrogation, but that its equitable-subrogation claim failed because NGM acted as a “mere
volunteer” when it paid PIP benefits to Ravenell. Id. at 3-7. NGM applied for leave to appeal to
our Supreme Court. In lieu of granting NGM’s application for leave to appeal, the Supreme Court
vacated our opinion and remanded the case for us to reconsider this case in light of Esurance, ___
Mich ___. Ravenell, ___ Mich at ___; slip op at 1. In Esurance, our Supreme Court addressed a
single issue: whether a no-fault insurer acts as a “mere volunteer” for equitable-subrogation
purposes when paying PIP benefits it mistakenly thought it was obligated to make. Esurance, ___
Mich at ___; slip op at 7-19. Thus, we interpret our Supreme Court’s order as directing us to
reconsider this case only to the extent it is affected by Esurance.
II. ANALYSIS
As we explained when this case first appeared before us:
On appeal, ACIA argues that the trial court erroneously granted NGM
partial summary disposition and erroneously denied its request for summary
disposition under MCR 2.116(I)(2). ACIA’s principal argument is that whenever
a no-fault-insurance carrier pays PIP benefits to a person injured in an auto accident
and then seeks to be reimbursed for such payments from another insurer believed
to be of higher priority, the action is necessarily one of equitable subrogation.
ACIA further argues that NGM cannot prevail on an equitable-subrogation claim
because it paid PIP benefits to Ravenell as a mere “volunteer” and that it has no
right of subrogation to recover the benefits it mistakenly paid. ACIA relies on
Titan, 270 Mich App at 343-344; Amerisure, 222 Mich App at 102-103; and
Michigan Mut Ins Co v Home Mut Ins Co, 108 Mich App 274, 277-279; 310 NW2d
362 (1981). In contrast, NGM relies on Madden v Employers Ins of Wausau, 168
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Mich App 33; 424 NW2d 21 (1988), to argue that payments of PIP benefits made
by mistake may always be recovered.
This Court reviews de novo a trial court’s grant or denial of a motion for
summary disposition. Titan, 270 Mich App at 342. Whether NGM was entitled to
recover against ACIA under a theory of equitable subrogation also raises an issue
of law that we review de novo. Hartford Accident & Indemnity Co v Used Car
Factory, Inc, 461 Mich 210, 215 n 5; 600 NW2d 630 (1999). [Ravenell, unpub op
at 2.]
A. THE NATURE OF NGM’S CLAIM
In our original opinion, we concluded that NGM’s claim was a claim for equitable
subrogation. Id. at 3-6. Esurance does not change our analysis on this issue because it addressed
whether a no-fault insurer acts as a “mere volunteer” for the purposes of equitable subrogation,
not whether a party has raised an equitable-subrogation claim. Esurance, ___ Mich at ___; slip op
at 7-19. Thus, we reaffirm our conclusion that NGM alleged a claim for equitable subrogation for
the reasons stated in our original opinion. See Ravenell, unpub op at 3-6.
B. “MERE VOLUNTEER”
ACIA argues that NGM’s equitable-subrogation claim must fail because NGM acted as a
“mere volunteer” when it paid PIP benefits to Ravenell. Our Supreme Court addressed a similar
issue in Esurance. In that case, Esurance paid PIP benefits to a claimant “pursuant to a no-fault
automobile insurance policy, issued to another person, that was later declared void ab initio.”
Esurance, ___ Mich at ___; slip op at 1-2. Esurance then filed suit against the Michigan Assigned
Claims Plan and the Michigan Automobile Insurance Placement Facility seeking reimbursement
under the theory of equitable subrogation. Id. at ___; slip op at 2. The Esurance Court concluded
that “an insurer who erroneously pays PIP benefits may be reimbursed under a theory of equitable
subrogation when the insurer is not in the order of priority and the payments are made pursuant to
its arguable duty to pay to protect its own interests.” Id.
In Esurance, Esurance paid PIP benefits to the claimant because it thought a valid insurance
contract existed and, therefore, that it had a legal obligation to pay those PIP benefits. Id. at ___;
slip op at 3. As explained by the Esurance Court, in such a situation an insurer is not acting as a
“mere volunteer” despite the lack of any actual duty to pay because the insurer is “protecting its
own interests” by complying with its perceived obligations under the no-fault act. Id. at ___; slip
op at 9-10, 16-18.
Such is the case here. NGM paid PIP benefits to Ravenell because NGM thought
Ravenell’s injuries were covered by one of its insurance policies. NGM later learned that this was
not the case and stopped paying PIP benefits to Ravenell. Accordingly, NGM was in the same
type of situation as Esurance: it paid PIP benefits based on a mistaken belief that it was required
to do so by an insurance policy. In doing so, NGM was protecting its interests because failure to
pay PIP benefits could result in litigation and violation of the no-fault act. See id. at ___; slip op
at 14-18. Thus, NGM was not acting as a “mere volunteer” when it paid PIP benefits to Ravenell.
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The parties do not dispute that ACIA is higher in priority than NGM. Consequently, NGM is
entitled to reimbursement under the theory of equitable subrogation because it paid PIP benefits
to Ravenell to protect its own interests and it is not the highest-priority insurer. See id. at ___; slip
op at 2.
C. UNJUST ENRICHMENT
We rejected NGM’s unjust-enrichment argument in our original opinion because NGM
failed to raise the issue at the trial court level and its claim was for equitable subrogation. Ravenell,
unpub op at 7-8. Esurance did not address unjust enrichment. Esurance, ___ Mich at ___; slip op
at 7-19. Thus, we reaffirm our unjust-enrichment holding for the reasons stated in our original
opinion. See Ravenell, unpub op at 7-8.
III. CONCLUSION
For the reasons stated in this opinion, we affirm the trial court’s orders granting summary
disposition to NGM and denying ACIA’s motion for summary disposition. NGM is entitled to
reimbursement for the PIP benefits it mistakenly paid to Ravenell.
/s/ Brock A. Swartzle
/s/ Kathleen Jansen
/s/ Stephen L. Borrello
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