Court Opinion

ID: 2711913
Source: CourtListenerOpinion
Date Created: 2014-08-05 20:13:50.689227+00
Date Added: 2024-06-11T13:15:11.618512
License: Public Domain

Order                                                                        Michigan Supreme Court
                                                                                   Lansing, Michigan

  November 15, 2013                                                                  Robert P. Young, Jr.,
                                                                                                Chief Justice

  147342 & (42)                                                                       Michael F. Cavanagh
                                                                                      Stephen J. Markman
                                                                                          Mary Beth Kelly
                                                                                           Brian K. Zahra
                                                                                   Bridget M. McCormack
  TITAN INSURANCE COMPANY,                                                               David F. Viviano,
            Plaintiff-Appellee,                                                                      Justices

  v                                                       SC: 147342
                                                          COA: 308401
                                                          Wayne CC: 11-003671-NF
  AMERICAN COUNTRY INSURANCE
  COMPANY,
           Defendant-Appellant.

  _________________________________________/

         On order of the Court, the motion for miscellaneous relief is GRANTED. The
  application for leave to appeal the March 26, 2013 judgment of the Court of Appeals is
  considered, and it is DENIED, because we are not persuaded that the questions presented
  should be reviewed by this Court.

         MARKMAN, J. (concurring).

         I write separately only to highlight this case for the possible attention of the
  Legislature. Plaintiff was assigned two personal protection insurance claims involving
  the same uninsured claimant. Having been assigned both claims, plaintiff was obligated
  under MCL 500.3175(1) to adjust the claims and “make prompt payment of loss” to the
  claimant. This remained the case even after it was discovered that defendant owed
  coverage on the second accident.

          The record suggests that the two claims should have been adjusted so that the
  claimant received a substantially greater settlement for the claim arising from the first
  accident, in which she sustained back and neck injuries, than for the claim arising from
  the second accident, in which she sustained no significant injuries. Despite this,
  plaintiff’s settlement with the claimant allocated $10,000 to the first accident and $25,000
  to the second accident. Defendant asserts that plaintiff’s motivation for this allocation
  was a function of its statutory entitlement to reimbursement from defendant for the
  second, but not the first, claim.
                                                                                                              2

        MCL 500.3172(1) specifies that “the insurer to which [a] claim is assigned is
entitled to reimbursement from the defaulting insurers to the extent of their financial
responsibility.” Furthermore, it indicates that a default on insurance coverage occurs
when “the personal protection insurance applicable to the injury cannot be ascertained
because of a dispute between 2 or more automobile insurers concerning their obligation
to provide coverage . . . .” Id. As defendant disputed whether any payment was due on
the second claim, a default occurred, allowing plaintiff to adjust the claims at its
discretion with the awareness that it would only be entitled to reimbursement for the
second accident, which arguably created an incentive on its part to allocate a greater
percentage of the losses to the second accident.

        Currently, the law accommodates the kind of gamesmanship that defendant alleges
occurred here, and leaves defendant without any effective means of ensuring that its
liability for reimbursement is limited to the claims that arose from the accident that
defendant is obligated to cover and not from other accidents that defendant is not
obligated to cover. The Legislature might wish to further examine the potential
unfairness that may result under the circumstances of cases such as this.

                        I, Larry S. Royster, Clerk of the Michigan Supreme Court, certify that the
                  foregoing is a true and complete copy of the order entered at the direction of the Court.
                        November 15, 2013
       t1112
                                                                            Clerk