Bahri v. IDS Prop. Cas. Ins. Co.

• Decision Date: 09 October 2014
• Docket Number: Docket No. 316869.
• Citation: 864 N.W.2d 609,308 Mich.App. 420
• Parties: BAHRI v. IDS PROPERTY CASUALTY INSURANCE CO.
• Court: Court of Appeal of Michigan — District of US

308 Mich.App. 420

864 N.W.2d 609

BAHRI

v.IDS PROPERTY CASUALTY INSURANCE CO.

Docket No. 316869.

Court of Appeals of Michigan.

Submitted Sept. 10, 2014, at Detroit.

Decided Oct. 9, 2014.

Approved for publication Dec. 9, 2014, at 9:15 a.m.

Nazek A. Gappy PC (by Nazek A. Gappy) for intervening plaintiffs.

Garan Lucow Miller, PC, Detroit (by Caryn A. Ford and Jami E. Leach ), for defendant.

Before: RIORDAN, P.J., and CAVANAGH and TALBOT, JJ.

Opinion

PER CURIAM.

Intervening plaintiffs, Dr. Labeed Nouri and Dr. Nazih Iskander, appeal as of right the trial court order granting summary disposition in favor of defendant, IDS Property Casualty Insurance Company, in this action to recover first-party personal protection insurance (PIP) benefits under the no-fault act, MCL 500.3101. We affirm.

I. FACTUAL BACKGROUND

Plaintiff was involved in two car accidents, one on March 4, 2011, and the other one on October 20, 2011.¹ The second accident is at issue in this appeal. Before the second accident, defendant issued a no-fault automobile policy to plaintiff on October 12, 2011.

According to the October 20, 2011 police report, as plaintiff exited an alley in Detroit, her brakes “failed” and she hit another car. The police report indicates only two cars were involved. However, plaintiff's deposition testimony varied from that report. She claimed a third car was involved, explaining: “We were stopped. I saw a car, it was coming—it was coming like--like an airplane was flying. He went and he did something and I don't know—until now I don't know how. Did I press the gas? I wanted to just get myself out of this problem and I hit another car as well.”

Following the October 20 accident, plaintiff sought PIP and uninsured motorist benefits from defendant. With respect to replacement services, plaintiff submitted to defendant “Household Services Statements” which indicated that multiple replacement services were provided daily to plaintiff from October 2011 through February 29, 2012. The document indicates that plaintiff was receiving replacement services for the entire month of October. However, surveillance video during this time captured plaintiff bending, lifting, driving, and running errands.

Plaintiff filed the instant complaint on June 6, 2012, seeking to recover PIP benefits and uninsured motorist benefits from defendant. Doctors Nouri and Iskander, who treated plaintiff, intervened to recover PIP benefits payable to plaintiff for medical services they provided after the second accident.

Defendant moved for summary disposition, arguing that under the terms of the policy, PIP benefits and uninsured motorist benefits were precluded because of plaintiff's fraudulent representations. It also argued that because intervening plaintiffs stood in the shoes of plaintiff, they were not entitled to receive PIP benefits. In regard to uninsured motorist benefits, defendant argued that because no third vehicle had in fact struck plaintiff's vehicle, the plain language of the policy precluded the payment of uninsured motorist benefits.

The trial court ultimately agreed with defendant, and granted summary disposition in its favor. Intervening plaintiffs now appeal.²

II. SUMMARY DISPOSITION

A. STANDARD OF REVIEW

Intervening plaintiffs first argue that the trial court erred by granting defendant's motion for summary disposition with respect to their claim for PIP benefits. A grant or denial of a motion for summary disposition under MCR 2.116(C)(10) is reviewed de novo. MEEMIC Ins. Co. v. DTE Energy Co., 292 Mich.App. 278, 280, 807 N.W.2d 407 (2011).³ The motion for summary disposition “tests the factual support for a claim and should be granted if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law.” Id. “A genuine issue of material fact exists when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue upon which reasonable minds might differ.” West v. Gen. Motors Corp., 469 Mich. 177, 183, 665 N.W.2d 468 (2003). In reviewing a motion for summary disposition under MCR 2.116(C)(10), a court considers “affidavits, pleadings, depositions, admissions, and other documentary evidence submitted by the parties in the light most favorable to the party opposing the motion.”Greene v. A.P. Prods., Ltd., 475 Mich. 502, 507, 717 N.W.2d 855 (2006) (quotations marks and citations omitted).

B. PIP BENEFITS

The no-fault policy at issue contained a general fraud exclusion, which provided: “We do not provide coverage for any insured who has made fraudulent statements or engaged in fraudulent conduct in connection with any accident or loss for which coverage is sought under this policy.”

“The rules of contract interpretation apply to the interpretation of insurance contracts.” McGrath v. Allstate Ins. Co., 290 Mich.App. 434, 439, 802 N.W.2d 619 (2010). The language in an insurance contract should be read as a whole, and we construe the language to give effect to every word, clause, and phrase. Id. “When the policy language is clear, a court must enforce the specific language of the contract. However, if an ambiguity exists, it should be construed against the insurer.” Id. (citation omitted). Any undefined term should be given its plain and ordinary meaning, which may be gathered from dictionaries. Id. Although this Court will

“construe the contract in favor of the insured if an ambiguity is found, this does not mean that the plain meaning of a word or phrase should be perverted, or that a word or phrase, the meaning of which is specific and well recognized, should be given some alien construction merely for the purpose of benefiting an insured.” [Citizens Ins. Co. v. Pro–Seal Serv. Group, Inc., 477 Mich. 75, 82, 730 N.W.2d 682 (2007) (citation omitted).]

Because intervening plaintiffs stood in the shoes of the named insured, if plaintiff cannot recover benefits, neither can intervening plaintiffs. See, e.g., TBCI, P.C. v. State Farm Mut. Auto. Ins. Co., 289 Mich.App. 39, 44, 795 N.W.2d 229 (2010). Further, this Court has explained the requirements for establishing fraud or false swearing as follows:

To void a policy because the insured has wilfully misrepresented a material fact, an insurer must show that (1) the misrepresentation was material, (2) that it was false, (3) that the insured knew that it was false at the time it was made or that it was made recklessly, without any knowledge of its truth, and (4) that the insured made the material misrepresentation with the intention that the insurer would act upon it. A statement is material if it is reasonably relevant to the insurer's investigation of a claim. [Mina v. Gen. Star Indemnity Co., 218 Mich.App. 678, 686, 555 N.W.2d 1 (1996), rev'd in part on other grounds 455 Mich. 866, 568 N.W.2d 80 (1997) (citation omitted).]

We agree with the trial court that the fraud exclusion applied in the instant case. In order to substantiate her claim for replacement services, plaintiff presented a statement indicating that services were provided by “Rita Radwan” from October 1, 2011 to February 29, 2012. Because the accident occurred on October 20, 2011, on its face, the document plaintiff presented to defendant in support of her PIP claim is false, as it sought recoupment for services that were performed over the 19 days preceding the accident.

Moreover, defendant produced surveillance evidence depicting plaintiff performing activities inconsistent with her claimed limitations. Plaintiff was observed bending, lifting, carrying objects, running errands, and driving—on the dates when she specifically claimed she needed help with such tasks. Of particular note, on November 11, 2011, plaintiff represented that she required assistance vacuuming, cooking, dishwashing, making beds, grocery shopping, taking out the garbage, driving, and running errands. Yet surveillance videos captured her performing various activities, such as lifting, carrying, and dumping a large bucket of liquid in her yard. On December 19, 2011, plaintiff sought replacement services for various household activities, including grocery shopping. But on that day, she was observed running several errands from 11:05 a.m. until 7:00 p.m. Plaintiff indicated that on December 29, 2011, she required Radwan's assistance to drive her and perform multiple household activities. However, surveillance video on that day captured plaintiff driving her own vehicle on errands. Similar discrepancies were noted for December 30, 2011.

This evidence belies plaintiff's assertion that she required replacement services, and it directly and specifically contradicts representations made in the replacement services statements. Reasonable minds could not differ in light of this clear evidence that plaintiff made fraudulent representations for purposes of recovering PIP benefits. Stated differently, we find no genuine issue of material fact regarding plaintiff's fraud. See Mina, 218 Mich.App. at 686, 555 N.W.2d 1. Because plaintiff's claim for PIP benefits is...