Court Opinion

ID: 9957742
Source: CourtListenerOpinion
Date Created: 2024-04-05 06:05:43.274115+00
Date Added: 2024-06-11T08:18:36.741881
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

BASMAN AJA,                                                           UNPUBLISHED
                                                                      April 4, 2024
               Plaintiff-Appellant,

and

ALEXANDRA PHYSICAL THERAPY, LLC,1

               Intervening Plaintiff,

v                                                                     No. 364314
                                                                      Wayne Circuit Court
PROGRESSIVE MICHIGAN INSURANCE                                        LC No. 20-016415-NF
COMPANY,

               Defendant-Appellee.

Before: GARRETT, P.J., and RIORDAN and LETICA, JJ.

PER CURIAM.

        In this no-fault action, plaintiff appeals as of right the trial court’s stipulated order of
dismissal, which dismissed all claims against defendant. However, plaintiff does not challenge
entry of the stipulated order of dismissal but, instead, challenges the court orders pertaining to the
reinstatement of certain medical bills. We affirm.

                                  I. FACTUAL BACKGROUND

      On December 17, 2019, plaintiff was driving in the area of Ten Mile Road and Groesbeck
Highway when another driver failed to yield to the right of way, resulting in an accident, and

1
  While Alexandra Physical Therapy, LLC, is listed as an intervening plaintiff, that party was
dismissed in a previous stipulated order of dismissal and is not involved in the instant appeal.

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leaving plaintiff with serious and permanent injuries. Plaintiff was insured by defendant at the
time of the aforementioned car accident. Plaintiff subsequently received treatment for injuries
sustained in the underlying incident and he acquired bills from various medical providers,
including Physiatry & Rehab Associates, doing business as Columbia Clinic Pain & Spine Institute
(Columbia Clinic), and Capital Healthcare, LLC, also known as Capital Surgery Center (Capital
Surgery). Plaintiff received services from Columbia Clinic between December 19, 2019, and
March 5, 2020, and from Capital Surgery on March 5, 2020. In connection with the treatment that
the aforementioned providers rendered, plaintiff executed assignments to each of them, both of
which occurred before plaintiff filed suit in the instant case. In each assignment, plaintiff
transferred his right to collect insurance benefits related to the treatment he received from each
provider.

        On December 17, 2020, plaintiff filed a complaint seeking payment of personal injury
protection (PIP) benefits from defendant. Plaintiff alleged that he incurred allowable expenses
under the no-fault act, MCL 500.3101 et seq., due to the injuries resulting from the accident;
however, defendant failed to pay as required. Defendant subsequently moved for partial summary
disposition of plaintiff’s claims for PIP benefits under MCR 2.116(C)(8) (failure to state a claim
upon which relief can be granted) and (C)(10) (no genuine issue of material fact). In its motion,
defendant argued that plaintiff was not eligible to claim PIP benefits because he assigned his rights
to pursue PIP benefits for medical treatment to the providers. Plaintiff opposed the motion, arguing
that he had the right to pursue PIP benefits against defendant notwithstanding the assignments
because the aforementioned assignments were mutually revoked on January 21, 2022.

        The trial court granted in part, and denied in part, defendant’s motion for partial summary
disposition, stating that plaintiff’s claims for treatment concerning Columbia Clinic and Capital
Surgery were dismissed with prejudice unless plaintiff provided the court with a dismissal order
addressing the pending suit between defendant and the aforementioned medical providers, which
was initiated separately by the providers on July 22, 2021. The trial court instituted a deadline of
March 3, 2022, regarding the dismissal order. However, the matter between defendant, Columbia
Clinic, and Capital Surgery was not dismissed until June 6, 2022.

        On August 1, 2022, plaintiff filed a motion to “reinstate provider bills,” contending that he
had no control over when the provider action involving defendant would be dismissed as he was
not privy to that case. However, plaintiff observed, due to the subsequent dismissal of this matter,
defendant rejected liability regarding those bills, exposing plaintiff personally to significant
treatment costs. Defendant responded that plaintiff lacked the requisite standing to pursue the
medical provider bills due to his previous valid assignments, and his subsequent revocations were
unenforceable because the relevant documents were not signed by plaintiff nor by an agent of
Columbia Clinic or Capital Surgery. Following a hearing, the trial court denied plaintiff’s motion
to reinstate provider bills, opining that (1) there were multiple discovery delays in this case, (2)
the revocations of assignments were not properly signed identifying the name of the person that
signed them or their position in context to the parties, (3) plaintiff presented no proof that the
provider bills remained outstanding and had not been sold or assigned to a third party, and (4) the
pending trial was scheduled for October 31, 2022, and discovery already concluded. This appeal
ensued.

                                       II. ASSIGNMENTS

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        Plaintiff argues that the trial court abused its discretion, or otherwise erred, when it denied
his motion to reinstate provider bills because (1) the evidentiary record does not indicate that the
medical providers sold or assigned their right to recover payment to a third party, (2) plaintiff
properly revoked his assignments of rights to the medical providers, (3) the one-year-back rule did
not bar plaintiff’s claims, and (4) defendant delayed the dismissal of the provider action, leading
to complications regarding plaintiff’s attempts to reinstate his medical-provider claims. We
disagree.

        “This Court reviews for abuse of discretion a trial court’s decision concerning a motion to
reinstate an action.” Kidder v Ptacin, 284 Mich App 166, 170; 771 NW2d 806 (2009) (quotation
marks and citation omitted). “[A]n abuse of discretion standard acknowledges that there will be
circumstances in which there will be no single correct outcome; rather, there will be more than one
reasonable and principled outcome.” Maldonado v Ford Motor Co, 476 Mich 372, 388; 719 NW2d
809 (2006) (quotation marks and citation omitted). “When the trial court selects one of these
principled outcomes, the trial court has not abused its discretion and, thus, it is proper for the
reviewing court to defer to the trial court’s judgment.” Id. (cleaned up).

        Under MCL 500.3107, PIP benefits are payable for “[a]llowable expenses consisting of
reasonable charges incurred for reasonably necessary products, services and accommodations for
an injured person’s care, recovery, or rehabilitation.” MCL 500.3107(1)(a). “The no-fault act
allows injured claimants to pursue recovery of PIP benefits themselves or they may assign their
right to recovery to their medical providers.” Wallace v Suburban Mobility Auth for Regional
Transp, ___ Mich App ___, ___; ___ NW2d ___ (2023) (Docket No. 360537); slip op at 3. “A
valid assignment occurs when the assignor manifests an intent to transfer and must not retain any
control or any power of revocation.” Id. (cleaned up).

        “When an assignment occurs, the assignee of a cause of action becomes the real party in
interest with respect to that cause of action, inasmuch as the assignment vests in the assignee all
rights previously held by the assignor.” Farrar v Suburban Mobility Auth for Regional Transp,
___ Mich App ___, ___; ___ NW2d ___ (2023) (Docket Nos. 358872 and 358884); slip op at 5
(quotation marks and citation omitted). “A real party in interest is the one who is vested with the
right of action on a given claim, although the beneficial interest may be in another.” Id. (quotation
marks and citation omitted). “The real-party-in-interest doctrine recognizes that litigation should
be begun only by a party having an interest that will assure sincere and vigorous advocacy and
protects a defendant from multiple lawsuits for the same cause of action.” Id. at 6 (quotation marks
and citation omitted).

        When plaintiff commenced this action on December 17, 2020, he was not the real party in
interest because his right to recover the unpaid medical bills at issue was divested by virtue of the
assignments executed on March 5, 2020, regarding Columbia Clinic, and July 7, 2020, concerning
Capital Surgery. See Estate of Maki v Coen, 318 Mich App 532, 539; 899 NW2d 111 (2017)
(providing that the real party in interest rule “requir[es] that the claim be prosecuted by the party
who by the substantive law in question owns the claim that is asserted in the complaint”) (quotation
marks and citation omitted). As explained earlier, following the assignment of these claims, the
“assignee of a cause of action becomes the real party in interest with respect to that cause of action,
inasmuch as the assignment vests in the assignee all rights previously held by the assignor.”
Cannon Twp v Rockford Pub Sch, 311 Mich App 403, 412; 875 NW2d 242 (2015). “An assignee

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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, 653; 680 NW2d 453 (2004). Consequently,
the medical providers as assignees held the right to seek to recover the unpaid medical bills, and
plaintiff no longer had a cause of action to pursue, having transferred it away to Columbia Clinic
and Capital Surgery.

        Although Columbia Clinic and Capital Surgery, as the real parties in interest, maintained
the right to bring an action to recover the unpaid medical bills, the evidentiary record indicates that
neither medical provider exercised the rights embedded in their respective assignments by bringing
suit within a year of providing services. MCL 500.3145(2). Columbia Clinic provided services
to plaintiff between December 19, 2019 and March 5, 2020, and Capital Surgery provided services
on March 5, 2020. The assignment regarding Columbia Clinic was executed on March 5, 2020,
and the assignment regarding Capital Surgery was executed on July 7, 2020. However, Columbia
Clinic and Capital Surgery neglected to file their complaint against defendant regarding the
underlying claims until July 22, 2021, more than one year after the services were provided. Thus,
the claims of Columbia Clinic and Capital Surgery were barred by the one-year-back rule. Id.

         The instant matter is similar to the circumstances in Wallace, which featured a claimant,
like plaintiff, seeking the recovery of medical bills that were assigned before the initiation of
litigation. However, at the time of the subsequent revocation of assignment, the medical providers
no longer maintained a viable, transferrable right to recover PIP benefits because they failed to
comply with the one-year-back rule. See Wallace, ___ Mich App at ___; slip op at 6 (noting that
“when the transfer of the beneficial interest from the medical providers to plaintiff occurred in this
case, the medical providers did not transfer an interest in a claim to which liability attached”).
Consequently, the medical providers’ rights under the assignment were statutorily barred. Id.

        Here, while plaintiff timely sued to recover the cost of the medical services, as he filed his
complaint on December 17, 2020, he previously had assigned those rights to the medical providers.
Plaintiff attempted to remedy the aforementioned circumstances by executing revocation
agreements during the course of the trial-court proceedings, which contained language similar to
a nunc pro tunc clause in an attempt to essentially eradicate the original assignments. However,
this Court has denied such “creative solutions,” and explained that obtaining revocations from
medical providers does not otherwise save a plaintiff’s claims because “one must be the real party
in interest at the time the lawsuit is filed, and a retroactive, or nunc pro tunc, revocation may not
be used to correct a factual problem that existed when the lawsuit was filed.” Wallace, ___ Mich
App at ___; slip op at 5 (quotation marks and citation omitted). Wallace further explained:

       While plaintiff and her medical providers were at liberty to mutually decide to
       revoke the assignments, the revocations were effective as of the date that the
       revocations were executed and could not essentially eliminate the fact that the
       assignments had occurred prior to plaintiff filing suit. And, the medical providers
       had no timely claims to return to plaintiff as of the date of the revocations because
       the revocations occurred more than a year after services were rendered. Thus, the
       mutual revocations did not reassign any timely claims to plaintiff. [Id. (quotation
       marks and citation omitted).]

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        Consequently, much like in Wallace, “when plaintiff obtained the revocations, each
provider’s right to collect on these claims for benefits had already been extinguished by the one-
year-back rule. Thus, there remained no actionable causes of action to give back to plaintiff.” Id.
at ___; slip op at 6.

        Plaintiff argues that the trial court erroneously concluded that his assignment revocations
were invalid because the relevant documents were signed by both assignor and assignees, and
defendant’s claims that the representatives signing the document lacked the requisite authority to
do so are misplaced. However, the validity of the underlying revocation instruments is irrelevant,
because “[w]hen the medical providers revoked their assignments for the benefit of plaintiff to
pursue [his] claims after the litigation began, the medical providers could no longer recover their
claims by operation of the one-year-back rule,” as explained prior. Wallace, ___ Mich App at ___;
slip op at 6. Under MCL 500.3145(2), a “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.” “The one-
year-back rule 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.” Farrar, ___ Mich App
at ___; slip op at 4 (quotation marks and citation omitted). In Farrar, this Court explained that
due to the medical provider treating the plaintiff on March 6, 2019, the medical provider “was
required to file its complaint by March 6, 2020, to ensure its lawsuit could proceed.” Id. However,
the medical provider neglected to file its intervening complaint until February 11, 2021, almost
two years after the accident. Id. Farrar concluded, “Accordingly, under the express language of
the one-year-back rule, [the medical provider] is barred under MCL 500.3145(2) from recovering
any benefits that it incurred before February 11, 2020.” Id. In the instant case, Columbia Clinic
and Capital Surgery filed suit on July 22, 2021, approximately one year and four months after they
provided services to plaintiff, and any liability for their claims was extinguished by the time
plaintiff received the revocations of the assignments in January 2022.

        Plaintiff also advances that the trial court incorrectly opined that he repeatedly failed to
follow its various discovery orders, in addition to the court’s March 3, 2022 deadline regarding
dismissal of the lawsuit between defendant and the medical providers. The trial court refused to
specify which orders plaintiff allegedly breached. However, we note that concerning the March
3, 2022 deadline, it is unclear how plaintiff was responsible for the parties’ refusal to agree to a
dismissal when plaintiff was not a party to the suit between defendant, Columbia Clinic, and
Capital Surgery. The medical providers purportedly sought a stipulation from defendant to dismiss
the required action; however, defendant refused, delaying the dismissal past the court’s instituted
deadline. In any event, even if the parties complied with the mandated March 3, 2022 deadline
regarding the dismissal of the provider suit, the matter of plaintiff bringing suit when he was not
the real party in interest remains an insurmountable obstacle to obtaining relief due to the previous
assignments.

        Plaintiff further argues that the evidentiary record does not indicate that the medical
providers sold or assigned their rights to recover payment to a third party. We agree that there is
insufficient proof Columbia Clinic or Capital Surgery assigned or sold their respective interests to
recover payment.        Nonetheless, the previous assignments involving plaintiff and the
aforementioned providers, in conjunction with the ill timing of the subsequent revocations,
established that plaintiff was unable to sue to recover the bills associated with Columbia Clinic
and Capital Surgery because he was not the real party in interest at the time of filing. In light of

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these circumstances, the trial court did not abuse its discretion when it denied plaintiff’s motion to
reinstate the provider bills related to Columbia Clinic and Capital Surgery.

                                        III. CONCLUSION

       The trial court did not abuse its discretion by denying the motion at issue. We affirm.

                                                              /s/ Kristina Robinson Garrett
                                                              /s/ Michael J. Riordan
                                                              /s/ Anica Letica

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