Court Opinion

ID: 4665153
Source: CourtListenerOpinion
Date Created: 2021-03-05 10:08:00.876716+00
Date Added: 2024-06-11T09:01:49.714059
License: Public Domain

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

NORTH SHORE INJURY CENTER, INC,                                   UNPUBLISHED
EXCELLENT PAIN CONSULTANTS, INC, and                              March 4, 2021
RED WINGS MEDICAL TRANSPORTATION,
LLC,

              Plaintiffs-Appellees,

and

NORTHLAND RADIOLOGY, INC,

              Intervening Plaintiff,

v                                                                 No. 350750
                                                                  Oakland Circuit Court
HOME-OWNERS INSURANCE COMPANY,                                    LC No. 2016-153794-NF

              Defendant-Appellant.

Before: LETICA, P.J., and GLEICHER and O’BRIEN, JJ.

PER CURIAM.

     Defendant appeals by leave granted1 the trial court’s order denying defendant’s motion for
summary disposition under MCR 2.116(C)(8) and (10) against plaintiffs North Shore Injury

1
 North Shore Injury Center Inc v Home-Owners Ins Co, unpublished order of the Court of
Appeals, issued January 29, 2020 (Docket No. 350750).

                                              -1-
Center, Inc, Excellent Pain Consultants, Inc, and Red Wings Medical Transportation, LLC, and
partial summary disposition against intervening-plaintiff Northland Radiology, Inc.2 We reverse.

                                       I. BACKGROUND

        On August 31, 2015, Joys King was in a motor vehicle accident and sustained injuries
entitling him to no-fault benefits from his insurer, defendant. North Shore Injury Center, Inc,
Excellent Pain Consultants, Inc, and Red Wings Medical Transportation, LLC treated King, and
on July 1, 2016, filed a complaint requesting payment of no-fault benefits from defendant for that
treatment. Northland Radiology also treated King, and the trial court granted Northland
Radiology’s motion to intervene in this case on October 5, 2016.

      While this case was ongoing, King filed his own first-party complaint against defendant in
Wayne County on August 26, 2016.

       On May 25, 2017, our Supreme Court issued Covenant Med Ctr, Inc v State Farm Mut
Auto Ins Co, 500 Mich 191, 196; 895 NW2d 490 (2017), wherein it held that a medical provider
does not have a statutory cause of action against a no-fault insurer. On March 14, 2017—before
Covenant—King assigned the right to pursue no-fault benefits on his behalf to Northland
Radiology. After Covenant, King signed assignments of rights with North Shore Injury Center
and Red Wings Medical Transportation on July 11, 2017, and an assignment of rights with
Excellent Pain Consultants on July 13, 2017.

         On May 15, 2019, defendant moved for summary disposition under MCR 2.116(C)(8) and
(10), arguing that it was entitled to summary disposition against North Shore Injury Center,
Excellent Pain Consultants, and Red Wings Medical Transportation, and partial summary
disposition against Northland Radiology, because all (or for Northland Radiology, some) of their
claimed damages were barred by the one-year back rule in MCL 500.3145(1). At the time this
case was filed, MCL 500.3145(1) provided in relevant part that “the claimant may not recover
benefits for any portion of the loss incurred more than 1 year before the date on which the action
was commenced.”3 Defendant contended that if a no-fault case is premised on an assignment of
rights from the insured, then, based on Jawad A Shah, MD, PC v State Farm Mut Auto Ins Co, 324
Mich App 182; 920 NW2d 148 (2018) (Shah), the one-year limit on damages in MCL 500.3145(1)
is measured by the date of the assignment. According to defendant, when that is done in this case,
the claims of North Shore Injury Center, Excellent Pain Consultants, and Red Wings Medical
Transportation were completely barred, and claims by Northland Radiology for services performed
before March 14, 2016 were barred.

2
  While Northland Radiology is technically an intervening-plaintiff, this opinion uses “plaintiffs”
to refer to North Shore Injury Center, Excellent Pain Consultants, Red Wings Medical
Transportation, and Northland Radiology.
3
 MCL 500.3145 has since been amended by 2019 PA 21, and the language relevant to this case is
now part of MCL 500.3145(2).

                                               -2-
        In response, plaintiffs contended that their claims were not barred by MCL 500.3145.4
According to plaintiffs, the one year for MCL 500.3145 should not be measured from the date that
King signed the assignments. Rather, because King had filed his own suit against defendant on
August 26, 2016, he had the right to collect benefits from defendant as far back as August 26,
2015, and this was one of the rights that King assigned to plaintiffs as part of the assignments of
rights. That is, plaintiffs contended that the one year for purposes of MCL 500.3145 should be
measured from the date that King filed his own suit against defendant.

        On August 7, 2019, the trial court heard the parties’ arguments on defendant’s motion.
After listening to the parties’ arguments, the trial court denied defendant’s motion, reasoning that,
based on “the law of assignment,” King assigned to plaintiffs his right to collect no-fault benefits
from defendant that were incurred less than one year before King filed his complaint in his lawsuit
against defendant.

       This appeal ensued.

                                  II. STANDARD OF REVIEW

        Appellate courts review de novo a trial court’s decision on a motion for summary
disposition. Innovation Ventures v Liquid Mfg, 499 Mich 491, 506; 885 NW2d 861 (2016).
Whether plaintiffs’ recovery is barred by the one-year back rule requires this Court to interpret
MCL 500.3145(1). Questions of statutory interpretation are reviewed de novo. Joseph v Auto
Club Ins Ass’n, 491 Mich 200, 205; 815 NW2d 412 (2012).

                                          III. ANALYSIS

         When this case was filed, MCL 500.3145(1) provided in pertinent part that “the claimant
may not recover benefits for any portion of the loss incurred more than 1 year before the date on
which the action was commenced.” This is known as the one-year back rule, and it “is designed
to limit the amount of benefits recoverable under the no-fault act to those losses occurring no more
than one year before an action is brought.” Joseph, 491 Mich at 203. In Shah, 324 Mich App at
202-205, this Court held that when an insured assigns a medical provider the right to collect
benefits from an insurer after the provider has already filed suit against the insurer, “the pertinent
point of reference for purposes of the one-year-back rule” is the date of the assignment. The Shah
Court reasoned:

               In this case, after the Covenant decision was issued, plaintiffs sought to
       amend their complaint to account for the assignments obtained from Hensley [the
       insured] to allow plaintiffs to pursue an action against defendant insurer. “An
       assignee stands in the position of the assignor, possessing the same rights and being
       subject to the same defenses.” [Burkhardt v Bailey, 260 Mich App 636, 652-653;
       680 NW2d 453 (2004)]. For that reason, plaintiffs could not obtain any greater

4
  Northland Radiology originally did not contest that MCL 500.3145(1) barred its claims for
damages incurred more than a year before the date of King’s assignment of rights, but later
changed its position and concurred with the other plaintiffs’ response.

                                                 -3-
        rights from Hensley on the date of the assignments—July 11, 2017—than Hensley
        himself possessed on that date. Had Hensley filed an action directly against
        defendant on July 11, 2017, he would not have been permitted to recover benefits
        for any portion of the loss incurred one year before that date. MCL 500.3145(1).
        Accordingly, plaintiffs also could not obtain any right to recover benefits for losses
        incurred more than one year before July 11, 2017, through an assignment of rights
        from Hensley. Burkhardt, 260 Mich App at 652-653. [Shah, 324 Mich App at
        204.]

        This case is not directly analogous to Shah because, when King assigned his rights to
plaintiffs, he had already filed his own separate action against defendant and, in that action, could
recover benefits for losses incurred more than one year before he assigned his rights to plaintiffs.
The trial court reasoned that, because King had the right to recover benefits up to one year before
he filed his suit on August 26, 2016, plaintiffs, standing in the shoes of King by virtue of the
assignments, could also recover benefits from defendant up to one year before August 26, 2016.
We disagree.

        MCL 500.3145(1) states:

                An action for recovery of personal protection insurance benefits payable
        under this chapter for accidental bodily injury may not be commenced later than 1
        year after the date of the accident causing the injury unless written notice of injury
        as provided herein has been given to the insurer within 1 year after the accident . . . .
        However, the claimant may not recover benefits for any portion of the loss incurred
        more than 1 year before the date on which the action was commenced. [Emphasis
        added.]

In Massey v Mandell, 462 Mich 375, 382 n 5; 614 NW2d 70 (2000), our Supreme Court explained
that “the” and “a” have separate meanings—“the” is a definite article that has a specifying effect,
whereas “a” or “an” are indefinite articles that have a generalizing effect. The Court further
explained that when “both are within the same subsection of a statute, . . . there can be no
legitimate claim that this Court should read ‘the’ as if it were ‘a.’ ” Id.

       Applying this to MCL 500.3145(1), the use of “an” to qualify “action” in the first sentence
has a generalizing effect; the sentence refers generally to actions for recovery of no-fault benefits
payable under the relevant chapter. The statute’s latter use of “the” to qualify “action” has a
specifying effect; the sentence refers to a specific action. Reading the statute as a whole, when a
claimant files “an action” for recovery of no-fault benefits “payable under this chapter,” the
claimant’s recovery is limited to losses incurred not more than one year before that specific action
was commenced. MCL 500.3145(1).

        King filed “an action” against defendant on August 26, 2016, and his recovery was limited
to losses incurred not more than one year before his specific action was commenced. Plaintiffs
filed “an action” against defendant on July 21, 2016, and their recovery was limited to losses
incurred not more than one year before their specific action was commenced. King assigning his
rights to plaintiffs does not change that plaintiffs filed their action on July 21, 2016, and plaintiffs’
specific action is “the action” relevant for the one-year back rule in MCL 500.3145(1). For

                                                  -4-
purposes of MCL 500.3145(1), “the date on which the action was commenced” refers to the date
that the specific action was commenced; it cannot be the date on which a different, separate action
was commenced.

        In reaching a different conclusion, the trial court reasoned that if King could recover losses
incurred not more than one year before his action was commenced, then plaintiffs, standing in the
shoes of King, could also recover losses incurred not more than one year before King’s action was
commenced. This reasoning overlooks the fact that King did not have the same rights to recovery
in plaintiffs’ action against defendant that he did in his own, separate action against defendant.
MCL 500.3145(1) limits recovery to one year before “the action”—meaning a claimant’s specific
action—was commenced. See Massey, 462 Mich at 382 n 5. King, in his action against defendant,
could recover losses incurred not more than one year before his specific action was commenced.
But King was not part of plaintiffs’ action. As such, King, in plaintiffs’ action against defendant,
could not recover losses incurred not more than one year before King’s entirely separate action
against defendant was commenced. In short, King did not have the same rights to recovery in
plaintiffs’ action (which he was not part of) as he did in his own action. Because King, in plaintiffs’
action, did not have the right to recover losses incurred not more than one year before King’s
separate action against defendant was commenced, he could not assign such a right to plaintiffs.
The trial court erred by holding that King could assign a right he did not have.

        This case is therefore governed by Shah. Plaintiffs did not have a statutory cause of action
against defendant when they commenced their action on July 21, 2016. See Covenant, 500 Mich
at 196; W A Foote Mem Hosp v Michigan Assigned Claims Plan, 504 Mich 985, 985 (affirming
the Court of Appeals’ holding that Covenant applies retroactively). To cure this, plaintiffs had
King assign to plaintiffs his right to recover no-fault benefits from defendant; King signed an
assignment of rights with Northland Radiology on March 14, 2017, assignments of rights with
North Shore Injury Center and Red Wings Medical Transportation on July 11, 2017, and an
assignment of rights with Excellent Pain Consultants on July 13, 2017. However, when King
assigned his rights to plaintiffs, he did not have the right, in plaintiffs’ action, to recover losses
incurred not more than one year before King commenced his own separate action—King only had
that right in King’s own action against defendant. It follows that, as in Shah, plaintiffs could not
obtain any right to recover benefits for losses incurred more than one year before the date of their
assignments from King. See Shah, 324 Mich App at 204-205.5

         Because North Shore Injury Center, Excellent Pain Consultants, and Red Wings Medical
Transportation incurred all of their losses more than one year before King assigned them his rights,
their claims were barred by the one-year back rule in MCL 500.3145(1). Defendant was entitled
to summary disposition on those plaintiffs’ claims. Similarly, Northland Radiology incurred some
of its losses more than one year before King assigned Northland Radiology his rights, and by virtue

5
  The Shah Court also held that an amendment to the plaintiffs’ pleadings to include the
assignments would be a supplemental pleading which could not relate back to the plaintiffs’
original complaint, and that the relation-back doctrine could not otherwise be used to acquire
greater rights to recovery than those received in the assignment. Shah, 324 Mich App at 204-205.
Plaintiffs never challenged this portion of Shah, so this opinion does not address it.

                                                 -5-
of the one-year back rule, defendant was entitled to partial summary disposition on Northland
Radiology’s claim to the extent that it sought to recover losses incurred more than one year before
King assigned his rights to Northland Radiology.

                                  IV. RESPONSE TO DISSENT

        This opinion does not “avoid[] any discussion of tolling,” as alleged by the dissent. There
is simply no need to discuss tolling as it relates to this case because the parties never raised
arguments about tolling and the trial court never decided that the one-year back rule was tolled.
When moving for summary disposition, defendant argued that plaintiffs’ claims were barred by
the one-year back rule because the “year back” should be measured from the date of plaintiffs’
assignments based on Shah. Defendant mentioned tolling only to argue that it did not apply to the
one-year back rule. In response, plaintiffs contended that, when King assigned his rights to
plaintiffs, plaintiffs “were afforded the same rights that Joys King would have possessed on those
dates: the right to seek payment of all no-fault benefits that may be owed by Defendant up to one
year prior to the date of [his] own complaint (i.e., for those benefits owed for dates of service from
September 26, 2015 forward).” In support of their argument, plaintiffs cited two cases—Burkhardt
and Shah—for the proposition that the assignments gave them (the assignees) the same rights
enjoyed by King (the assignor). Plaintiffs’ brief never mentioned tolling.6 In denying defendant’s
motion, the trial court discussed whether King’s complaint tolled the one-year back rule, but
ultimately denied defendant’s motion based on “the law of assignments.”7 When defendant filed

6
 It is unclear why the dissent believes that “ ‘tolling’ was at the center of the parties’ argument”
when the parties’ only mention of tolling in their briefing was to argue that it does not apply.
7
  The dissent focuses on the trial court’s mention of tolling and contends that this was the basis of
the court’s holding. Yet, after its mention of tolling (during which the trial court repeatedly
invoked principles of assignment), the trial court went on to explain that “the law of assignment is
you stand in the shoes of the person who gives you the assignment and that person could go back
a year before they filed their complaint . . . and that’s the right that got assigned.” This is the same
argument advanced by plaintiffs in their brief.
       Later, the trial court again mentioned tolling, and then had the following exchange
with defense counsel to explain its ruling:
               Ms. Frederick [defense counsel]: But King’s suit is long over and King’s
       suit has nothing to do with these suits.
               The Court: King assigned—King assigned his rights.
               Defense counsel: Right, and the one year back runs—
              The Court: And King had a—and King had a—and King had a right to
       include—to go after these bills and he assigned his right to them to go after his bills
       and he was protected by his filing. That’s all I’m saying. He—
               Defense counsel: Okay.
               The Court: —assigned the rights that he had.

                                                  -6-
for leave to appeal, it made the same argument it did in the trial court—that plaintiffs’ claims were
barred by the one-year back rule because that rule should be measured from the date of the
assignments. It again mentioned tolling only to argue that it did not apply. In their answer to
defendant’s application, plaintiffs’ only mention of tolling was in labeling one section of their
answer “Joy [sic] King’s lawsuit tolls the one-year back rule.” In the discussion that ensued,
plaintiffs never mentioned tolling or otherwise argued that the one-year back rule was tolled.
Instead, they made the same argument, verbatim, that they made in the trial court, citing the same
two cases—Burkhardt and Shah—for the same proposition about assignments. After defendant’s
application for leave to appeal was granted, defendant filed its brief, making the same arguments
it made in the trial court and in its application. Defendant again mentioned tolling only to argue
that it did not apply. Plaintiffs never filed a brief on appeal.

        In light of the foregoing, it is clear that the dissent is incorrect when it states, “As framed
by the parties, the question presented was whether a claimant’s timely lawsuit ‘tolls’ the statute of
limitations, thereby preserving a provider’s right to sue based on an assignment obtained after the
limitations period has expired.” Instead, as framed by the parties, the issue is whether, when King
assigned his rights to plaintiffs, plaintiffs acquired King’s right to collect benefits that accrued up
to one year before King filed his suit against defendant. This opinion concludes that plaintiffs did
not because King only had that right in his suit against defendant, not in plaintiffs’ suit, and King
could not assign a right to plaintiffs that he did not have.

         Plaintiffs never raised any argument about the relation-back doctrine or otherwise argued
that the one-year back rule should be measured from the date of their original complaint. The
dissent ignores this and injects the relation-back doctrine as an issue in the case. The dissent states
that, after the assignments were executed, “[t]he question then became whether plaintiffs could
supplement their complaint to reflect that they had an assignment (‘a right to proceed’) in the case
they had filed.” Plaintiffs were permitted to supplement their complaint to reflect their
assignments, but after doing so, they never asserted that they could proceed because their

              Defense counsel: Right, and all the case law today says that the one-year
       back runs from the date of the assignment.
               The Court: But I still don’t think that it’s addressed exactly on point
       because most of those cases didn’t have a patient underlying suit and they didn’t
       address the issue that we’re talking about today. They need to address it, one way
       or the other, but I just don’t think it’s been specifically addressed and even when it
       has been somewhat addressed, it’s been in unpublished cases and I just—I don’t
       have to rely on them and I don’t agree. I think it goes contrary to the law of
       assignment. So therefore, I’m denying the motion.
Clearly, the trial court’s holding was based on its understanding of “the law of assignment,” not
on its belief that King’s complaint tolled the one-year back rule. If, as the dissent asserts, the trial
court indeed held that King’s complaint tolled the one-year back rule, then the trial court adopted
a holding based on an argument that neither party briefed. More incredibly, it adopted a holding
based on a legal principle that, even according to the dissent, is not relevant to this case.

                                                  -7-
supplemental pleading related back to their original complaint, as the dissent would hold. Rather,
plaintiffs repeatedly asserted, both in the trial court and in their filing on appeal, that “by filing
[his] action on August 26, 2016, and assigning [his] rights to Plaintiffs . . . Joys King transferred
those preserved rights to Plaintiffs with respect to [their] own charges,” so plaintiffs had “the right
to seek payment of all no-fault benefits that may be owed by Defendant up to one year prior to the
date of [King’s] complaint.” (Emphasis omitted.) That is, plaintiffs did not argue that the one-
year back rule should be measured from the date of their original complaint, but that the one-year
back rule should be measured from the date of King’s complaint because King had the right to
collect benefits that accrued up to one year before he filed his complaint, and he assigned that right
to plaintiffs. Plaintiffs’ decision to frame their argument in this way was clearly strategic.
Plaintiffs not only avoided arguing that Shah was wrongly decided, but repeatedly cited Shah for
its discussion about assignments and urged courts to rely on Shah to find in their favor.8

        As a court, we resolve the issues as they are presented to us. Plaintiffs never mentioned
the relation-back doctrine. Instead, they argued in the trial court that their claims were not barred
by the one-year back rule because, by virtue of King’s assignments, they acquired the right to
collect benefits that had accrued up to one year before King filed suit against defendant. The trial
court agreed with this argument based on “the law of assignments.” Thus, the issue on appeal is
whether, when King assigned his rights to plaintiffs, plaintiffs acquired the right to collect benefits

8
  Plaintiffs’ argument is easy to square with Shah. Plaintiffs argued that they were assigned King’s
right to collect benefits that accrued up to one year before King filed his complaint against
defendant, so only Shah’s discussion of assignments was relevant. The dissent’s argument for
plaintiffs, on the other hand, is difficult to square with Shah. The dissent believes that the one-
year back rule as applied to plaintiffs’ action should be measured from the filing of plaintiffs’
original complaint because plaintiffs’ supplemental pleading related back to that complaint. This
proposed conclusion clearly runs counter to Shah’s unequivocal holding that a supplemental
pleading to include an assignment cannot relate back to the original complaint. Shah, 324 Mich
App, 204-205 (“Because plaintiffs actually sought to file a supplemental pleading, it could not
relate back to the date of the original pleading.”); id. at 205 (“A supplemental pleading predicated
on the July 11, 2017 assignments could not relate back to the date of the original pleading.”). The
dissent attempts to distinguish this case from Shah, but neither “King’s accomplishment of notice”
nor “the filing of his separate lawsuit” distinguish the operative holding from Shah that a
supplemental pleading cannot relate back to the original complaint.
        Briefly, the dissent also dismisses this opinion’s discussion of the one-year back rule as
“fundamentally misplaced” because “the one-year-back rule presented no obstacle to King’s
recovery for services provided by plaintiffs” and “the one-year-back rule did not constrain [King’s]
rights.” But those considerations are irrelevant to this case’s resolution. As this opinion explains,
the one-year back rule is particular to a specific “action.” MCL 500.3145(1). That King, in his
action, could recover benefits dating back one year before he commenced suit in no way
necessitates that plaintiffs, in their action, can recover benefits dating back one year before they
commenced suit. King’s assignments do not require a different result for the reasons explained in
this opinion. The relation-back doctrine likewise cannot “do[] the work,” contrary to the dissent’s
assertion, because a supplemental pleading cannot relate back to an original pleading according to
Shah.

                                                 -8-
in their action against defendant that accrued not more than one year before King commenced his
separate action against defendant. This may not be the issue that the dissent wishes to address, but
it is the issue raised by the parties and decided by the trial court.

        Reversed and remanded for further proceedings consistent with this opinion. We do not
retain jurisdiction.

                                                             /s/ Colleen A. O’Brien

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