Court Opinion

ID: 9576255
Source: CourtListenerOpinion
Date Created: 2023-08-21 21:22:21.556151+00
Date Added: 2024-06-11T13:03:34.745983
License: Public Domain

Maher, P.J.
(dissenting). I respectfully dissent.
*424The section of the no-fault act which authorizes an award of attorney fees, § 3148(1), provides:
An attorney is entitled to a reasonable fee for advising and representing a claimant in an action for personal or property protection insurance benefits which are overdue. The attorney’s fee shall be a charge against the insurer in addition to the benefits recovered, if the court finds that the insurer unreasonably refused to pay the claim or unreasonably delayed in making proper payment. [MCL 500.3148(1); MSA 24.13148(1).]
Although the terms "unreasonably refused” and "unreasonably delayed” are not defined in the act, it has been held that a refusal or delay in making payment is not unreasonable where it is a product of a legitimate question of statutory construction, constitutional law, or even a bona fide factual uncertainty. Liddell v DAIIE, 102 Mich App 636, 650; 302 NW2d 260 (1981), lv den 411 Mich 1079 (1981).
However, cases from this Court interpreting §3148(1) have distinguished between situations where there is a legitimate dispute over the applicability of the no-fault act, or the amount of the benefits claimed thereunder, and situations where the insurer disputes its priority in paying the no-fault benefits. In the former situations, attorney fees are not awardable. See, e.g., Kreighbaum v Automobile Club Ins Ass'n, 170 Mich App 583, 586-587; 428 NW2d 718 (1988); Joiner v Michigan Mutual Ins Co, 137 Mich App 464, 479; 357 NW2d 875 (1984), lv den 422 Mich 920 (1985); Butt v DAIIE, 129 Mich App 211, 220-221; 341 NW2d 474 (1983); English v The Home Ins Co, 112 Mich App 468, 475-476; 316 NW2d 463 (1982). In the latter situations, attorney fees are awardable even though there may have been a legitimate question *425as to which insurer had first priority to pay the no-fault benefits. See, e.g., Darnell v Auto-Owners Ins Co, 142 Mich App 1, 11-13; 369 NW2d 243 (1985); Bach v State Farm Mutual Automobile Ins Co, 137 Mich App 128, 132-133; 357 NW2d 325 (1984); Kalin v DAIIE, 112 Mich App 497, 509-510; 316 NW2d 467 (1982), lv den 417 Mich 853 (1982). The reason for the stricter treatment of priority situations is because the preferred method of resolving priority disputes between two insurers is for one of the insurers to pay the claim and then sue the other in an action for subrogation. Problems of priority among insurers should not cause delay in the payment of benefits to which the claimant is entitled. Darnell, supra, p 12.
According to established case law then, plaintiff’s entitlement to attorney fees is dependent solely upon whether the issue in dispute was a matter of insurer priority. If the case involved a priority dispute, it matters not that an insurer had a legitimate question regarding its own liability to the plaintiff. In that situation, the plaintiff would be entitled to attorney fees, plain and simple. Darnell, supra; Bach, supra; Kalin, supra.
Contrary to the majority’s characterization of this case, I believe the true nature of the dispute— as ultimately confirmed by our Supreme Court— was one of insurer priority. In his dissent in Clute v General Accident Assurance Co of Canada, 142 Mich App 640; 369 NW2d 864 (1985) (hereinafter Clute I), Judge Hood clearly viewed the central issue as involving a priority dispute. Not only did he quote in full the no-fault act’s applicable priority provision, MCL 500.3114(4); MSA 24.13114(4), but he also specifically stated that "if the remainder of the language of subsection (4) above applies, clearly defendant is ñrst in priority to pay pip benefits.” (Emphasis added.) Id., p 645. When the *426case went before our Supreme Court, it reversed the Clute I majority in a summary decision, adopting the dissent of Judge Hood. 428 Mich 871; 401 NW2d 615 (1987). Thus, the Supreme Court also viewed the dispute as one of insurer priority. That view, which became the law of the case, cannot be disturbed or ignored by this Court on subsequent appeal. Perron v Royal Oak School Dist Bd of Ed, 155 Mich App 759, 766; 400 NW2d 709 (1986), lv den 428 Mich 891 (1987). Yet, this is exactly what the majority has done in holding that plaintiff is not entitled to attorney fees.
I do not believe it is of any consequence that defendant received favorable rulings from both the trial court and the Clute I majority. First of all, attorney fees may properly be assessed against an insurer even though, on appeal, it receives a favorable ruling on the primary issue. Darnell, supra, p 12. The reason for such a rule is that problems of priority among insurers do not justify delaying or refusing payment of benefits to the claimant who is undisputably entitled to benefits from one of the insurers. Id. Rather than refuse payment of any benefits whatsoever, the insurer’s course of action is to pay the proven claims and then sue the other insurer for subrogation. "A claimant who is clearly entitled to no-fault benefits should not be forced to hire an attorney merely because the circumstances of his accident create problems of priority among insurers.” Kalin, supra, p 510.
Moreover, I do not believe it would be unfair to assess attorney fees against defendant simply because it prevailed at the trial level and on initial appeal. As clearly spelled out by the Supreme Court, both the trial court and the Clute I majority were wrong. Had the case been properly decided from the outset, there is no doubt in my mind that plaintiff would be entitled to attorney *427fees. Defendant should not escape liability for those fees just because it had the good fortune of receiving favorable, but erroneous, rulings from both the trial court and this Court prior to a final, and adverse, decision by the Supreme Court. To hold otherwise would be to penalize the plaintiff for the mistakes of the judiciary.
Because I believe plaintiff is entitled to attorney fees under the no-fault act, I find it unnecessary to decide whether she would be alternatively entitled to such fees under MCR 2.403(0).