Supreme Court to Address Interplay (If Any) Between the No-Fault Act and the Governmental Tort Liability Act

Last Friday, September 19, 2014, I participated in a panel discussion at the Negligence Law Section breakout at the state bar conference in Grand Rapids to discuss the Michigan Supreme Court’s upcoming (October 8) hearing of oral arguments in the calendar cases of Hunter v. Sisco, et al, and Hannay v. MDOT, the latter in which I submitted an amicus curiae brief for Michigan Townships Association, and the counties of Macomb, Oakland and Wayne (99705.sc.amicus.curiae.br).

Here is the two-paged handout distributed at the session. (Hunter-Hannay Venn Diagram Final.9.17.2014.1226 and Hunter Hannay page 2).

Based on the outcome of that event, there is still much debate about the result in Hunter (no noneconomic damages can be awarded against the government under the motor vehicle exception to governmental immunity, MCL 691.1405, even though such damages are ordinarily available against “civilian” defendants under Michigan’s Automobile Insurance “No-Fault” Act, MCL 500.3135).

Of course, Hannay came to the opposite conclusion, only with respect to “excess” economic (wage loss) and future earning potential, which is why the cases have been consolidated.

Some issues raised at the discussion concern how to quantify or identify “bodily injury” damages.

I believe this would be medical expenses related to the physical injury, only.  However, such “damages”, and liability therefor, are ordinarily borne by the first-party, no-fault carrier, not the third-party tortfeasor under MCL 500.3135.

Thus, how can any liability be imposed against the government when you mesh the outcome of applying the GTLA and the No-Fault Act to motor vehicle accidents in which the government’s negligent operation of a motor vehicle causes injury.  See the Venn Diagram I created (the overlap, if any, is the real sticking point and where the case law and/or the legislation will have to be reconciled, eventually).

One suggestion I have made is that perhaps the first-party, no-fault carrier can bring a subrogation action against the government if the PIP carrier can prove negligence and injury, just as a PIP carrier might seek subrogation under MCL 500.3109 from another carrier that is otherwise liable according to the law.  In my work on worker’s compensation cases, we see this a lot.  The no-fault carrier will seek to implicate the worker’s compensation carrier claiming the injuries incurred in an auto accident arose out of and in the course of employment, and thus, are the primary responsibility of the worker’s compensation carrier. Under the statute, the no-fault carrier steps into the shoes of the plaintiff seeking recovery of the benefits, and thus, the no-fault carrier would have to prove negligence and liability on the part of the government under the motor vehicle exception.  I think it could be argued MCL 500.3109 would work the same way vis-à-vis the government.  Although, this is just a theory.  Hunter / Hannay are not likely to address this latent issue.

Another issue that arose was the indication that even before the 1965 GTLA accidents caused by government owned/operated motor vehicles allowed for recovery of damages that were similar, if not identical in nature to noneconomic damages, i.e., pain and suffering, mental anguish, etc.

Why is the term “bodily injury” in the GTLA now restricted only to physical injury?  My answer would be the strict construction of statutes waiving the government’s immunity forbid court’s from expanding the meaning of terms.  Although, the counter to that is that the legislature adopted the term in the motor-vehicle exception with the “common law” definition allowing for such expanded damages in the first place.  This would be a good argument if not for the fact that we are discussing governmental immunity from liability and suit.  The assumption is only the legislature can waive the government’s immunity, and therefore, if the liability is to be “expanded” it has to come in express language.  The courts can restrict or limit the meaning of the terms in the GTLA exceptions, but they cannot expand the meaning.  This is well-established in Michigan case law.

Another theory I raised in my amicus brief for MTA / Oakland, Wayne, and Macomb counties was whether the government can ever be liable for first-party PIP benefits under the no-fault act when the motor vehicle exception requires a demonstration of “fault” on the part of the government.

This is also not an issue that will be addressed by Hunter / Hannay, but given the jurisdictional nature of government immunity, and the fact the government is immune from liability unless within the explicit legislative exceptions of the GTLA, it is a question that will have to be answered eventually (even thought the government has presumed it is subject to the No-Fault Act for the more than 40 years of the latter’s existence, and of course, continues to participate in the system as both a No-Fault “PIP” carrier (either self-insured, or through an auto insurance carrier (or both))), and as a presumptive third-party tortfeasor.

The question was also raised why, if Hannay came out as a published opinion before Hunter, which it did, why Hunter did not follow Hannay under the “first out” rule.  Although, that matters little if the Supreme Court has consolidated the cases to address the issues.

Finally, as I noted in my presentation, Hunter actually retained the “threshold injury / serious impairment” analysis even though it rules there are no noneconomic damages available under the No-Fault Act.

What does this mean?  Why would the threshold injury analysis even matter if the government is only responsible for “bodily injury”?  Does this mean that the government is only responsible for serious impairment or threshold “bodily injury” and nothing below, or less than that?

I doubt this is what the COA panel in Hunter meant, but it was a curious statement that they made at the end of the opinion.  Perhaps they were trying to reconcile their opinion with the Hardy v. Oakland County case in which the Supreme Court held that a plaintiff suing under the motor vehicle exception, MCL 691.1405, still had to prove threshold injuries under MCL 500.3135 of the No-Fault Act.

It will be interesting to see oral argument in the case on October 8.

Carson J. Tucker has participated in and argued some of the most significant governmental immunity cases in Michigan during the past decade.

Mr. Tucker presented direct representation to the governmental defendants and prosecuted the entire appeal, including all appellate briefings and oral arguments before the Court of Appeals and Supreme Court in the following cases:

• Estate of Truett v. Wayne County, Unpublished Opinion of the Michigan Court of Appeals, dated May 6, 2014 (Docket No. 313638), briefed and argued by Carson J. Tucker for Wayne County
• Atkins v. SMART, 492 Mich. 707 (August 20, 2012), application granted, and briefed and argued by Carson J. Tucker in the Supreme Court
• Gentry v. Wayne County Deputy Sheriff Daniel Carmona, unpublished opinion of hte Michigan Court of Appeals, dated October 11, 2011 (Docket No. 296580), briefed and argued by Carson J. Tucker in the Court of Appeals
• Hamed v. Wayne County, 490 Mich. 1 (July 29, 2011), briefed and argued by Carson J. Tucker in the Court of Appeals and Supreme Court
• Odom v. Wayne County, 482 Mich. 459 (December 30, 2008), application for leave to appeal granted, and briefed and argued by Carson J. Tucker in the Supreme Court

In addition, Mr. Tucker has provided direct support to governmental entities in filing “friend of the court”, i.e., amicus curiae briefs in support of the governmental defendants in the following cases:

• Yono v. MDOT, ___ Mich. App. ___ (2014), after remand order, amicus curiae brief filed for Michigan Municipal League and Michigan Townships Association on June 16, 2014, after remand by Carson J. Tucker
• State Farm v. MMRMA, amicus curiae in Supreme Court for Oakland County, Wayne County, Macomb County, and Wayne County in support of MMRMA’s application, by Carson J. Tucker
• Hannay v MDOT, ___ Mich ___ (2014), application granted and consolidated with Hunter v. Sisco, amicus curiae filed for Michigan Townships Association, Macomb County, Oakland County and Wayne County, et al., by Carson J. Tucker
• Hagerty v Manistee, 493 Mich 933 (2013), amicus curiae in Michigan Supreme Court for Michigan Municipal League, et al., by Carson J. Tucker

Effective appellate representation demands different skills than those required by litigation attorneys.  Appellate attorneys are adept at analyzing the intricacies of each case from an objective and critical perspective.  From reviewing and preparing the lower court record, identifying errors for appeal, and developing a strategy to raise those issues that will be addressed by appellate courts, appellate attorneys are capable of handling the most complex appeals from the application stage to oral advocacy before the highest courts.  Our research abilities and knowledge of current issues in nearly all major subject-matter areas of the law provide our clients with efficient and immediate assistance with complex and high-exposure cases.

We are also experienced at navigating through all appellate courts to shepherd the appeal in the most expeditious fashion possible so that it can be reviewed and quickly ruled upon.

Below are some of the recent significant cases prosecuted by the Appeals and Legal Research Group.

• Omian v. Chrysler, LLC, Michigan Court of Appeals Docket No. 310743, remanded by Supreme Court as on leave granted, Supreme Court No. 146908, oral argument presented July 16, 2014 by Carson J. Tucker for Chrsyler, LLC
• Moore v. Nolff’s Construction and Travelers Ins., Michigan Court of Appeals Docket No. 313478 and 313440 (consolidated), application and cross-application granted and oral argument in Court of Appeals presented July 2014 by Carson J. Tucker for Nolff’s Construction and Travelers Insurance
• Arbuckle v. GM, Michigan Court of Appeals Docket No. 310611, oral argument in Court of Appeals presented May 2014 by Carson J. Tucker for GM
• Yono v. MDOT, ___ Mich. App. ___ (201_), amicus curiae brief filed for Michigan Municipal League and Michigan Townships Association on June 16, 2014, after remand by Carson J. Tucker
• Estate of Truett v. Wayne County, Unpublished Opinion of the Michigan Court of Appeals, dated May 6, 2014 (Docket No. 313638), briefed and argued by Carson J. Tucker for Wayne County
• Omian v. Chrysler Group, LLC, 495 Mich. 859 (2013), application filed by Carson J. Tucker, Supreme Court remand to Court of Appeals on leave granted, oral argument to be held in July 2014
• Ghanam v. John Does, 303 Mich. App. 522 (2013), application to appeal filed in Supreme Court by Carson J. Tucker
• State Farm v. MMRMA, ___ Mich App ___ (2013), amicus curiae for Oakland County in support of MMRMA application, by Carson J. Tucker
• Hannay v MDOT, ___ Mich ___ 201_), application granted, amicus curiae filed for Michigan Townships Association, Macomb County, Oakland County and Wayne County, et al., by Carson J. Tucker
• Yono v. MDOT, ___ Mich ___ (201_), oral argument on application granted, amicus curiae for Oakland, Macomb and Wayne County filed by Carson J. Tucker in support of the state’s application
• Huddleston v. Trinity Health, et al., 495 Mich. 976 (2014), oral argument on application granted, amicus curiae with Lawrence Garcia, Esq., for MDTC
• Ashley, LLC v Pittsfield Twp., 494 Mich 875 (2013), application granted, for Pittsfield Township by Carson J. Tucker (resolved by settlement)
• Bailey v. Schaaf, ___ Mich ___ (2013), amicus curiae for MDTC by Carson J. Tucker
• Atkins v. SMART, 492 Mich 707 (2012), oral argument on application, Court of Appeals case reversed by opinion, Carson J. Tucker
• Hagerty v Manistee, 493 Mich 933 (2013), amicus curiae for Michigan Municipal League, et al., by Carson J. Tucker
• McMurtrie v Eaton Corp, 490 Mich 976 (2011)
• Findley v DaimlerChrysler Corp., 490 Mich 928 (2011)
• Brewer v. AD.Transport Express, Inc, 486 Mich 50 (2010)
• Stokes v Chrysler, 481 Mich 266 (2008)
• Brackett v Focus Hope, Inc, 482 Mich 269 (2008)
• Rakestraw v Gen Dynamics, 469 Mich 220 (2003)

Supreme Court Amicus Brief Filed in State Farm v. MMRMA Case Considering Whether Police Vehicle Pursuing Speeding Motorcyclist Sufficiently “Involved” In Motor Vehicle Accident to Require Apportionment of Liability Among No-Fault Insurance Carriers

I filed an amicus curiae brief on behalf of Oakland County, Macomb County and Wayne County in this case, urging the Supreme Court to grant Michigan Municipal Risk Management Authority’s application or, alternatively, to reverse the Court of Appeals.  My brief is attached here:  Supreme Court Amicus Curiae Brief for Oakland, Wayne and Macomb Counties stamped copy.

In State Farm v. MMRMA, Supreme Court Case No. 147752, the Court of Appeals held that a police vehicle pursuing a speeding motorcyclist was sufficiently “involved” in a motor vehicle accident between the motorcyclist and another vehicle, even though the police vehicle was nowhere near in proximity to the motorcyclist when he (or his bike) collided with the other vehicle, insured by State Farm.  This holding resulted in the apportionment of liability between the no-fault insurance carrier for the county and the insurer of the vehicle.  Michigan Municipal Risk Management Authority (MMRMA) filed an application for leave to appeal the Court of Appeal’s decision.

Technically, this case is a pure insurance coverage dispute between two no-fault automobile insurance carriers.  Since motorcycles are not covered “vehicles” under Michigan’s No-Fault Act (and motorcyclists are not obligated to carry no-fault coverage), when a motorcyclist suffers injury in a motor vehicle accident, the no-fault act contains a provision “prioritizing” which no-fault insurers are to be “on the risk”.  MCL 500.3114(5)(a).  Subsection 6 provides if “2 or more” vehicles are involved in the [motor vehicle] accident” the insurers in the same order of priority shall apportion liability among themselves.

There is much debate about this provision and the “scope” of its meaning in terms of which vehicles are, or, are not, “involved in” the motor vehicle accident.  Several prior cases from the Supreme Court and Court of Appeals interpreting other provisions of the no-fault act appear to give an “expansive” interpretation of the phrase “involved in”, which results in apportionment of coverage responsibility among multiple insurers.

Governmental entities are affected by this case because they are also responsible to provide the security (insurance) required by the no-fault act for the day-to-day operations involving government owned vehicles.  In addition to being contrary to the plain language of the statutory provision, the Court of Appeals decision makes no mention of the effect its ruling has upon government operations and the fiscal consequences of imposing liability under circumstances in which the government is performing an essential function – in this case, the law enforcement function.  There are two other applications pending in the Supreme Court requesting the Court to consider this same provision and the “scope” and meaning of the phrase “involved in” when “motor vehicles” are ostensibly involved in an accident in which a motorcyclist suffers injury.  I previously wrote about this case, as well as the other two.

Police Vehicle Pursuing Fleeing Motorcyclist “Involved In” Motorcyclist’s Accident With Another Motor Vehicle Triggering Insurance Coverage Obligation on the Part of the Governmental Entity

See also:  Braverman ex rel Smutski v. Auto-Owners Ins. Co., et al and DMC v. Progressive, et al.

For more information about this and other similar cases contact Carson J. Tucker, Chair of the Appeals and Legal Research Group at Lacey & Jones, LLP, a Birmingham law firm serving clients since 1912.  Mr. Tucker can be reached at (248) 283-0763.

For more information about Lacey & Jones, click on the following practice area company pages on Linked In.

Lacey & Jones, LLP’s Appeals and Legal Research Group

Lacey & Jones, LLP’s Insurance Coverage and Recovery Group

Lacey & Jones, LLP’s Civil Litigation Group

Supreme Court Grants to Consider Whether Governmental Entities are Liable for “Wage Loss” Damages Under No-Fault Act

The Michigan Supreme Court has granted leave to appeal to address whether the “motor vehicle” exception to governmental immunity allows parties to seek economic damages in the form of “wage loss”, for bodily injuries arising out of motor vehicle accidents in which a governmental entity is involved.  The Governmental Tort Liability Act (GTLA) allows suit for “bodily injury and property damage” arising out of negligent operation of a motor vehicle by a governmental party.  MCL 691.1405.  Michigan’s No-Fault Act allows for the recovery of economic damages,  including wage loss.  MCL 500.3135(3)(c).

Plaintiff was injured in an accident with a salt truck operated by the state of Michigan, Michigan Department of Transportation (MDOT).  Plaintiff sued the state claiming economic damages, including “wage loss”, and non-economic damages for serious impairment of a bodily function, both of which are ordinarily recoverable under the No-Fault Act.

MDOT argued the GTLA waives the government’s suit immunity for “bodily injury” claims only, not any broader claims associated with such injury.  MDOT cited Weschler v. Mecosta County Rd. Comm’n, 480 Mich. 75, 85 (2008), which defined the term “bodily injury” under the GTLA’s motor vehicle exception as “physical or corporeal injury to the body”.  Weschler held “loss of consortium” was not recoverable under the “motor vehicle exception”.  Id.

In a published opinion, the Court of Appeals held that work-loss benefits and benefits for ordinary and necessary services that exceed the statutory personal protection insurance benefit maximum pursuant to MCL 500.3135(3) are awardable against governmental entities. (Under the No-Fault Act there is a provision allowing for recovery of damages in excess of the daily, monthly, and three-year limitations contained in the No-Fault Act (MCL 500.3107 through MCL 500.3110)).

The Court of Appeals also affirmed the trial court’s determination to award Plaintiff “lost earning potential” as a dental hygienist even though, before her injury, she had not yet completed her education in that field of study.  Hannay v. MDOT.COA.Opinion

In its grant order, the Supreme Court requests briefing on the issues of whether economic damages in the form of “wage loss” are recoverable under the GTLA’s motor vehicle exception (citing Weschler), and, if so, referring to the Court of Appeals ruling affirming the trial court’s award of “projected earnings”, whether loss of income from work, only, or lost earning capacity may be awarded.  Read the Court’s order here:  Hannay v. MDOT

This is a significant case likely to garner much attention.  MDOT’s argument is in line with the jurisdictional principle adhered to in Michigan concerning governmental immunity, and with the strict interpretation to be given to provisions waiving the government’s suit immunity.  If one adheres strictly to these principles, then the No-Fault Act would likely yield to the narrow confines of liability that can be imposed against the government under the GTLA.

The Court invites Insurance Institute of Michigan, Michigan Association of Justice, and the Michigan Defense Trial Counsel to submit briefs amicus curiae to address the question.