Lindsey Simon v. Priority Health Insurance Company ( 2020 )

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
LINDSEY SIMON, UNPUBLISHED
June 18, 2020
Plaintiff-Appellant,
v No. 347075
Wayne Circuit Court
PRIORITY HEALTH INSURANCE COMPANY, LC No. 18-003739-CK
Defendant-Appellee.
Before: MURRAY, C.J., and JANSEN and MARKEY, JJ.
PER CURIAM.
Plaintiff appeals by right the trial court’s order granting summary disposition in favor of
defendant and denying plaintiff’s competing motion for summary disposition. We affirm.
Plaintiff was a passenger on a motorcycle when the motorcycle was hit by a motor vehicle.
Plaintiff was thrown from the motorcycle and sustained severe injuries that required her to undergo
nearly two years of medical treatment. Safeco Insurance Company of America (Safeco) was the
insurer of the owner and registrant of the motor vehicle involved in the accident. Plaintiff did not
have her own motor vehicle insurance policy. Plaintiff was, however, covered by a health
insurance policy that she had with defendant. Initially, defendant informed plaintiff that under
Michigan’s no-fault act, MCL 500.3101 et seq., defendant was the insurer with primary
responsibility for the payment of insurance benefits because both the health insurance policy and
the Safeco insurance policy had coordination-of-benefits clauses.1 After further investigation,
1
The coordination-of-benefits clause in the health insurance policy identified several types of
insurance plans with which defendant would coordinate benefits, including:
Automobile insurance required by law to be purchased and not provided
under a group plan, but only to the extent that automobile insurance law requires
coverage of medical benefits. Most automobile insurance in Michigan is written on
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defendant learned that plaintiff was a passenger on a motorcycle at the time of the accident. On
the basis of this information, defendant determined that it was not obligated to pay for plaintiff’s
healthcare costs associated with the accident, and it informed plaintiff of its position. Defendant
relied on the following exclusionary clause in the health insurance policy:
No Legal Obligation to Pay. Service or supplies are not Covered if you
would not be required to pay for them if you did not have this Coverage. That
includes, among other things, service and supplies performed or provided by a
family member.
Defendant maintained that plaintiff was not required to pay for medical services and supplies
because Safeco was legally obligated under the no-fault act to cover the medical expenses.
Plaintiff sued defendant for breach of contract. In a separate action, plaintiff sought
personal protection insurance (PIP) benefits from Safeco. In the instant action, both parties moved
for summary disposition. The trial court granted summary disposition in favor of defendant and
denied plaintiff’s motion for summary disposition. In explaining its decision, the trial court stated
that under our Supreme Court’s ruling in Harris v Auto Club Ins Ass’n, 494 Mich 462; 835 NW2d
356 (2013), plaintiff was not permitted to seek double recovery of benefits because Safeco had a
statutory obligation to pay PIP benefits, meaning that medical services were not covered under the
exclusion in plaintiff’s health insurance policy with defendant. This appeal ensued.
We review de novo a trial court’s decision on a motion for summary disposition. DeFrain
v State Farm Mut Auto Ins Co, 491 Mich 359, 366; 817 NW2d 504 (2012).2 Similarly, this Court
a “coordinated” basis in which the health plan must assume primary responsibility
for covered benefits. Some automobile insurance is written on a “full medical”
basis, which assumes the automobile insurance carrier is the primary payer.
2
Summary disposition under MCR 2.116(C)(10) is appropriate when, “[e]xcept as to the amount
of damages, there is no genuine issue as to any material fact, and the moving party is entitled to
judgment or partial judgment as a matter of law.” A motion brought pursuant to MCR
2.116(C)(10) tests the factual support for a party's action. Pioneer State Mut Ins Co v Dells, 301
Mich App 368, 377; 836 NW2d 257 (2013). “A trial court may grant a motion for summary
disposition under MCR 2.116(C)(10) if the pleadings, affidavits, and other documentary evidence,
when viewed in a light most favorable to the nonmovant, show that there is no genuine issue with
respect to any material fact.” Id. “A genuine issue of material fact exists when the record, giving
the benefit of reasonable doubt to the opposing party, leaves open an issue upon which reasonable
minds might differ.” West v Gen Motors Corp, 469 Mich 177, 183; 665 NW2d 468 (2003). The
trial court is not permitted to assess credibility, weigh the evidence, or resolve factual disputes,
and if material evidence conflicts, it is not appropriate to grant a motion for summary disposition
under MCR 2.116(C)(10). Pioneer State, 301 Mich App at 377. A court may only consider
substantively admissible evidence actually proffered by the parties. Maiden v Rozwood, 461 Mich
109, 121; 597 NW2d 817 (1999). “Like the trial court's inquiry, when an appellate court reviews
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reviews questions of statutory and contractual interpretation de novo. Bazzi v Sentinel Ins Co, 502
Mich 390, 398; 919 NW2d 20 (2018). “An insurance policy is a contractual agreement between
the insured and the insurer.” Farm Bureau Ins Co v TNT Equip, Inc, 328 Mich App 667, 672-673;
939 NW2d 738 (2019). The Michigan Supreme Court further explained:
An insurance policy, like other contracts, is an agreement between parties;
a court’s task is to determine what the agreement is and then give effect to the intent
of the parties. In doing so, we consider the contract as a whole and give meaning to
all terms of the contract. We give the policy language its ordinary and plain
meaning, and when policy language is clear, we are bound by the language of the
policy. [Id. at 672 (citations omitted).]
And in Wayne Co v AFSCME Local 3317, 325 Mich App 614, 633-634; 928 NW2d 709
(2018), this Court set forth the well-established rules of statutory interpretation:
The primary task in construing a statute is to discern and give effect to the
Legislature’s intent, and in doing so, we start with an examination of the language
of the statute, which constitutes the most reliable evidence of legislative intent.
When the language of a statutory provision is unambiguous, we must conclude that
the Legislature intended the meaning that was clearly expressed, requiring
enforcement of the statute as written, without any additional judicial construction.
Only when an ambiguity in a statute exists may a court go beyond the statute’s
words to ascertain legislative intent. We must give effect to every word, phrase,
and clause in a statute, avoiding a construction that would render any part of the
statute nugatory or surplusage. [Citations omitted.]
The no-fault act underwent a major overhaul in 2019 PA 21, effective June 11, 2019, but
at the time of the accident, MCL 500.3114(5) provided:
A person suffering accidental bodily injury arising from a motor vehicle
accident that shows evidence of the involvement of a motor vehicle while an
operator or passenger of a motorcycle shall claim personal protection insurance
benefits from insurers in the following order of priority:
(a) The insurer of the owner or registrant of the motor vehicle involved in
the accident.
(b) The insurer of the operator of the motor vehicle involved in the accident.
(c) The motor vehicle insurer of the operator of the motorcycle involved in
the accident.
a motion for summary disposition, it makes all legitimate inferences in favor of the nonmoving
party.” Skinner v Square D Co, 445 Mich 153, 162; 516 NW2d 475 (1994).
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(d) The motor vehicle insurer of the owner or registrant of the motorcycle
involved in the accident.
“MCL 500.3114(5)[] establishes the priority in which a motorcycle rider accidentally
injured by a motor vehicle must claim no-fault benefits.” Farmers Ins Exch v Farm Bureau Gen
Ins Co, 272 Mich App 106, 111; 724 NW2d 485 (2006). “Because the plain language of MCL
500.3114(5)(a) requires that an insurer that insures an owner or registrant who owns the motor
vehicle involved in an accident with a motorcycle is first in priority to pay no-fault benefits to the
injured person, further construction is not permitted.” Id. at 114. With respect to MCL
500.3114(5), this Court in Hmeidan v VHS of Mich, Inc, 326 Mich App 467, 479-480; 928 NW2d
258 (2018), explained:
[D]espite not requiring motorcyclists to obtain PIP coverage, our
Legislature has extended PIP coverage to motorcyclists by statute, at least in
instances in which a motor vehicle is involved in an accident with a motorcyclist.
In other words, our Legislature has made a policy choice to provide motorcyclists
with the more expansive PIP coverage whenever they are injured in an accident
involving a motor vehicle, rather than being limited to the optional medical-benefits
coverage motorcyclists may also choose to purchase. [Citations omitted.]
Here, under MCL 500.3114(5)(a), plaintiff had an absolute statutory right to claim and
recover PIP benefits from Safeco. Concomitantly, the same statute placed on Safeco the obligation
to pay PIP benefits, thereby covering the medical costs incurred in relation to the treatment of
plaintiff’s injuries that arose out of the accident. Plaintiff’s entitlement to PIP benefits was a right
created purely by statute.
Under the exclusionary provision in the health insurance policy, defendant had no
obligation to provide any coverage if plaintiff would not be required to pay for healthcare services
and supplies absent the coverage. We hold that because Safeco had a statutory obligation to pay
PIP benefits to cover the healthcare services and supplies at issue, plaintiff was not required to pay
for those services and supplies; therefore, the exclusionary clause was implicated and defendant
did not owe any medical benefits to plaintiff under the health insurance policy.
This case is controlled by our Supreme Court’s decision in Harris, 494 Mich 462. In the
opening paragraph of Harris, the Supreme Court stated:
The significant question in this case is whether a person claiming personal
protection insurance (PIP) benefits under MCL 500.3114(5)(a) for injuries arising
from a motor vehicle accident may also recover an award for those same injuries
under a health insurance policy that contains a provision titled, “Care and Services
That Are Not Payable,” which provides, “[w]e do not pay for the following care
and services: Those for which you legally do not have to pay or for which you
would not have been charged if you did not have coverage under this certificate.”
The Court of Appeals majority in this case held that because plaintiff Brent Harris,
for purposes of the no-fault act, incurred expenses on receiving treatment, he could
seek a duplicate award from his health insurer, third-party defendant Blue Cross
Blue Shield of Michigan (BCBSM), because these were services for which Harris
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legally had to pay. We conclude that, regardless of when Harris incurred expenses
arising from the motor vehicle accident, he simply did not legally have to pay these
expenses. When Harris sought treatment for his injuries under MCL
500.3114(5)(a), the legally assigned insurer, defendant Auto Club Insurance
Association (ACIA), became liable for all of Harris’s PIP expenses. Because
BCBSM’s policy plainly provides that BCBSM is not liable for expenses that
Harris does not legally have to pay, Harris cannot collect expenses from both ACIA
and BCBSM. Accordingly, we reverse in part the December 27, 2011 judgment of
the Court of Appeals and reinstate the judgment of the Oakland Circuit Court. [Id.
at 464 (alteration in original).3]
The Harris Court observed that unlike the claimants in cases in which a double recovery
of insurance benefits was awarded, Harris was not claiming benefits under a no-fault insurance
policy that he or anyone else had procured, as he was neither a third-party beneficiary nor a
subrogee of the ACIA no-fault insurance policy; rather, Harris’s right to PIP benefits arose solely
by statute. Id. at 471-472. The Supreme Court found that Harris was entitled to PIP coverage
because MCL 500.3114(5)(a) designated ACIA as the responsible insurer. Id. at 472. The Court
noted that “an insured must pay a premium to obtain insurance policies that provide for double
recovery” and that Harris had not paid the necessary premiums to receive a double recovery. Id.The Court held that “[u]nder MCL 500.3114(5)(a), Harris was not obligated to pay his medical
expenses because, as a matter of law, ACIA was liable for Harris’s PIP expenses.” Id.Harris simply cannot be distinguished from the facts here, and plaintiff’s arguments to the
contrary are unavailing because they are inconsistent with the clear language of Harris.4
Apparently coming to that realization, plaintiff argues that Harris should be overruled. “The Court
of Appeals is bound to follow decisions by [the Supreme] Court except where those decisions have
clearly been overruled or superseded and is not authorized to anticipatorily ignore our decisions
where it determines that the foundations of a Supreme Court decision have been undermined.”
Associated Builders & Contractor v Lansing, 499 Mich 177, 191-192; 880 NW2d 765 (2016)
(emphasis omitted). We are bound by the Supreme Court’s holding in Harris; thus, plaintiff needs
to take her argument directly to our Supreme Court.
3
The factual background in Harris was as follows:
On July 11, 2008, Harris was injured when he was struck by a motor vehicle
while operating a motorcycle. Harris had a health insurance policy, referred to as a
Professional Services Group Benefit Certificate (the policy or the certificate), with
BCBSM. The owner of the motor vehicle that struck Harris was insured under a
no-fault insurance policy issued by ACIA. [Harris, 494 Mich at 465.]
4
It becomes unnecessary to address the issue concerning the application of the coordination-of-
benefits clause in the health insurance policy.
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We affirm. Having fully prevailed on appeal, defendant may tax costs under MCR 7.219.
/s/ Christopher M. Murray
/s/ Kathleen Jansen
/s/ Jane E. Markey
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