Court Opinion

ID: 4397952
Source: CourtListenerOpinion
Date Created: 2019-05-17 09:07:17.858534+00
Date Added: 2024-06-11T13:31:57.448893
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

MISHELLE KENNEDY,                                                  UNPUBLISHED
                                                                   May 16, 2019
               Plaintiff-Appellee,

v                                                                  No. 343010
                                                                   Court of Claims
STATE OF MICHIGAN,                                                 LC No. 17-000324-MZ

               Defendant-Appellant.

Before: SWARTZLE, P.J., and M. J. KELLY and TUKEL, JJ.

PER CURIAM.

        Defendant, the state of Michigan, appeals by right the order of the Court of Claims
denying its motion for summary disposition. In December 2017, plaintiff filed a complaint
alleging that defendant unreasonably refused to provide her with personal protection insurance
(PIP) benefits for injuries she sustained during and in the course of her employment with
defendant. Defendant moved for summary disposition based on governmental immunity under
MCR 2.116(C)(7), alleging that plaintiff failed to comply with the notice requirements of the
Court of Claims Act (CCA), MCL 600.6401 et seq. The Court of Claims held that plaintiff’s
claim did not accrue until defendant informed her that it would stop paying PIP benefits and that
plaintiff timely filed her claim within six months of that date as required under MCL
600.6431(3). We affirm.

                                      I. BACKGROUND

       In May 2015, plaintiff, a state of Michigan employee, was involved in an automobile
accident while driving a state-owned vehicle. Plaintiff suffered injuries because of the accident
and sought PIP benefits from defendant. Plaintiff received PIP benefits administered by a third
party on behalf of defendant from May 2015 through January 2017. In August 2017, the third-
party administrator of the PIP benefits sent a letter to plaintiff’s attorneys informing them that
the Attorney General’s Office was denying any further payment of PIP benefits to plaintiff
because that office believed plaintiff was not disabled. In December 2017, plaintiff filed a
complaint in the Court of Claims, alleging that she was entitled to PIP benefits from defendant

                                               -1-
and that defendant unreasonably refused to pay or unreasonably delayed making proper
payments.

       Defendant moved for summary disposition, alleging that plaintiff had not complied with
the requirements of MCL 600.6431, which provides, in relevant part:

               (1) No claim may be maintained against the state unless the claimant,
       within 1 year after such claim has accrued, files in the office of the clerk of the
       court of claims either a written claim or a written notice of intention to file a claim
       against the state or any of its departments, commissions, boards, institutions, arms
       or agencies . . . .

                                              * * *

               (3) In all actions for property damage or personal injuries, claimant shall
       file with the clerk of the court of claims a notice of intention to file a claim or the
       claim itself within 6 months following the happening of the event giving rise to
       the cause of action.

        In the Court of Claims, defendant argued that “the happening of the event giving rise to”
plaintiff’s claim was the car accident in May 2015. Defendant argued, therefore, that plaintiff
was required to file a notice of intent to file a claim or the claim itself within six months from
that date. In contrast, plaintiff argued that the event that gave rise to her cause of action was
defendant’s denial of PIP benefits in August 2017, and that she filed her complaint within the
six-month limitations period.

        The Court of Claims denied defendant’s motion for summary disposition, concluding that
“plaintiff’s cause of action [arose] out of defendant’s decision to discontinue PIP benefits,” and,
therefore, her claim accrued in August 2017. The Court of Claims further noted that if it adopted
defendant’s position that plaintiff’s claim accrued on the date of the car accident, “it would mean
that plaintiff . . . could only pursue a claim if she: (a) filed a complaint for the denial of PIP
benefits while defendant was still paying PIP benefits; or (b) gave notice of her intent to file a
claim for the denial of PIP benefits while defendant was still paying PIP benefits.”

                                          II. ANALYSIS

       We review de novo a trial court’s decision on a motion for summary disposition. Mays v
Governor, 323 Mich. App. 1, 24; 916 NW2d 227 (2018). Likewise, this Court reviews de novo
questions of statutory interpretation. Id. at 24-25.

         While governmental agencies are generally immune from tort liability, the government
“may voluntarily subject itself to liability and may also place conditions or limitations on the
liability imposed.” Id. at 25-26 (cleaned up). MCL 600.6431 places one such condition on suits
against the state of Michigan. Mays, 323 Mich. App. at 26. MCL 600.6431(3) requires that in
cases involving personal injury, the claimant must file “a notice of intent to file a claim or the
claim itself within 6 months following the happening of the event giving rise to the cause of
action.” This notice requirement “is an unambiguous condition precedent to sue the state,” and

                                                -2-
courts may not “reduce the party’s obligation to comply fully with the statutory notice
requirements.” Mays, 323 Mich. App. at 27 (cleaned up). Therefore, “a claimant’s failure to
strictly comply” with the statute “warrants dismissal of the claim.” Id.

        The parties do not dispute that plaintiff’s claim is one for personal injuries and that the
six-month notice requirement of MCL 600.6431(3) applies. The sole issue is which event—
plaintiff’s car accident or defendant’s denial of PIP benefits—gave rise to plaintiff’s claim.
Defendant claims that the event that gave rise to plaintiff’s claim was her car accident. We
disagree.

        In Bauserman v Unemployment Ins Agency, __ Mich __; __ NW2d __ (2019) (Docket
No. 156389) our Supreme Court considered the language of MCL 600.6431(3) in the context of
the plaintiffs’ due-process claims against a state agency. The Court specifically examined
whether the plaintiffs in that case filed their complaint or notice of intent to sue “within 6 months
following the happening of the event giving rise to the cause of action,” as required by MCL
600.6431(3). Id. at __; slip op. at 9-10. The Court concluded that an event gives rise to a cause
of action “when it triggers a person’s ability to obtain a remedy in court.” Id. at __; slip op. at
10. The Court explained that “the happening of the event giving rise to the cause of action” was
synonymous with “when a claim accrues,” and that a claim accrues “at the time the wrong upon
which the claim is based was done regardless of the time when damage results.” Id. at __; slip
op. at 11. In turn, the wrong upon which the claim is based is the date on which the defendant’s
actions “harmed the plaintiff, as opposed to the date on which defendant breached his duty.” Id.
(cleaned up).

        In this case, plaintiff was in a car accident in May 2015 and received PIP benefits from
defendant between July 2015 and January 2017. In August 2017, the benefits administrator
informed plaintiff’s attorneys that the Attorney General’s Office was denying the payment of
further PIP benefits to plaintiff. In December 2017, plaintiff filed suit against defendant for
unreasonably delaying or refusing to pay benefits. The relief plaintiff sought was “no fault-
benefits that are past due and presently owed.” As plaintiff’s complaint makes clear, the relevant
and actionable harm in this case is defendant’s allegedly improper termination of her PIP
benefits, not the initial car accident. See Frank v Linkner, 500 Mich. 133, 150; 894 NW2d 574
(2017). Plaintiff’s claim arose when she first could have sought a remedy, which did not occur
until defendant denied her benefits.

         Our Legislature has defined the date of accrual of a claim more broadly than defendant
proposes in this case. The date on which defendant harmed plaintiff is when it informed her that
she would no longer receive PIP benefits. See Mays, 323 Mich. App. at 28. A determination that
plaintiff’s claim arose on the date of the car accident would require plaintiff to have filed suit or
provided notice of her intent to file at a time when defendant itself had no reason to know that it
would discontinue plaintiff’s PIP benefits more than a year later. See id. at 27-28. As our
Supreme Court has explained, the limitations period for a cause of action does not begin to run
until all elements of the claim exist. Bauserman, __ Mich at __; slip op. at 10-11. It would have
been impossible for plaintiff to make a claim for damages against defendant for denial of PIP
benefits within six months of the underlying car accident because at that time defendant was still
paying her PIP benefits. See Mays, 323 Mich. App. at 28-29.

                                                -3-
        Finally, the Insurance Code of 1956, MCL 500.100 et seq., provides a specific statute of
limitations for recovery of PIP benefits. MCL 500.3145. Normally, a claimant may not bring an
action for recovery of PIP benefits more than one year after the date of the accident causing
injury. MCL 500.3145(1). If “the insurer has previously made a payment” of PIP benefits for
the injury, however, an action “may be commenced at any time within 1 year after the most
recent allowable expense, work loss or survivor’s loss has been incurred.” Id. As the Court of
Claims correctly noted,

       the no-fault act describes a limitations period for actions for the recovery of PIP
       benefits, generally, and contains an express exception for scenarios where the
       insurer has previously made a payment of [PIP] benefits for the injury. The act of
       making payment creates a different period for filing an action and a different
       accrual date for actions involving PIP benefits. [Cleaned up.]

This provision supports our conclusion that plaintiff’s claim accrued on the date she was denied
further PIP benefits, not on the date of the underlying car accident.

        In sum, accepting all well-pleaded factual allegations as true and construing them in favor
of plaintiff, the Court of Claims correctly determined that the event that gave rise to plaintiff’s
claim was her receipt of notice of defendant’s decision to deny further payment of PIP benefits.
Plaintiff filed her claim within six months of that date in compliance with the notice
requirements of MCL 600.6431(3). Therefore, the Court of Claims properly denied defendant’s
motion for summary disposition based on governmental immunity under MCR 2.116(C)(7).

       Affirmed.

                                                            /s/ Brock A. Swartzle
                                                            /s/ Michael J. Kelly
                                                            /s/ Jonathan Tukel

                                                -4-