Booth v. Auto-Owners Ins. Co.

• Decision Date: 25 July 1997
• Docket Number: Docket No. 192527,AUTO-OWNERS
• Parties: Christine BOOTH, Plaintiff-Appellant, v.INSURANCE COMPANY, Defendant-Appellee.
• Court: Court of Appeal of Michigan — District of US

Page 903

569 N.W.2d 903

224 Mich.App. 724

Christine BOOTH, Plaintiff-Appellant, v. AUTO-OWNERS INSURANCE COMPANY, Defendant-Appellee.

Docket No. 192527.

Court of Appeals of Michigan.

Submitted March 5, 1997, at Detroit.

Decided July 25, 1997, at 9:35 a.m.

Released for Publication Oct. 28, 1997.

Law Offices of Martin M. Miller by Martin M. Miller and Charles W. Wojno, Detroit, for Plaintiff-Appellant.

Garan, Lucow, Miller, Seward & Becker, P.C. by James L. Borin and Nancy J. Bourget, Detroit, for defendant-appellee.

Before MARK J. CAVANAGH, P.J., and REILLY and WHITE, JJ.

PER CURIAM.

In this insurance dispute, plaintiff appeals as of right the trial court's decision granting summary disposition in favor of defendant. We reverse.

Defendant is plaintiff's no-fault insurance carrier. In 1989, plaintiff was involved in a serious automobile accident while making a delivery for her employer. As a result, she suffered a severe closed head injury and was in a coma for several months. After her discharge from the hospital in 1989, plaintiff went to live with her parents, Dawn and Thomas Booth. Since that date, Dawn allegedly has provided attendant care for her daughter twenty-four hours a day, seven days a week. Thomas also cares for plaintiff when he is home.

Plaintiff's employer's worker's compensation carrier agreed to compensate Dawn and Thomas for their services at a rate of $8 an hour. Pursuant to § 315(1) of the Worker's Disability Compensation Act (WDCA), M.C.L. § 418.315(1); M.S.A. § 17.237(315)(1), this compensation was limited to fifty-six hours a week. After defendant refused to pay Dawn for the remaining 112 hours of care a week, plaintiff filed this suit. In granting summary disposition in favor of defendant, the trial court held that plaintiff failed to submit evidence establishing that she had incurred expenses relating to the attendant care services provided by her parents because she was not charged for these services. The court also held that plaintiff could not seek no-fault benefits from defendant for her parents' services in excess of fifty-six hours a week because plaintiff could have obtained payment from her worker's compensation carrier if the care was provided by a commercial agency instead of her parents. We disagree with both rationales for granting summary disposition in favor of defendant and, therefore, reverse.

Section 3107(1)(a) of the no-fault act, M.C.L. § 500.3107(1)(a); M.S.A. § 24.13107(1)(a), provides that personal protection insurance (PIP) benefits are payable for "[a]llowable expenses consisting of all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person's care, recovery, or rehabilitation." There are three requirements that must be satisfied in order for a no-fault insurer to be responsible for PIP benefits: (1) the expense must have been incurred, (2) the expense must have been for a product, service, or accommodation reasonably necessary for the injured person's care, recovery, or rehabilitation, and (3) the amount of the expense must have been reasonable. Moghis v. Citizens Ins. Co. of America, 187 Mich.App. 245, 247, 466 N.W.2d 290 (1990).

This Court previously has considered compensation for care provided by family members in Visconti v. DAIIE, 90 Mich.App. 477, 282 N.W.2d 360 (1979), and Van Marter v. American Fidelity Fire Ins. Co., 114 Mich.App. 171, 318 N.W.2d 679 (1982).

In Visconti, the plaintiff sought to recover the value of his wife's services at a rate of $20 a day for the 132 days of care she provided while the plaintiff's leg was in a cast. The Court held that the services were compensable under the no-fault act and cited subsections a and b of the version of M.C.L. § 500.3107; M.S.A. § 24.13107 in effect at that time, the pertinent parts of which are unchanged in the current version of M.C.L. § 500.3107(1); M.S.A. § 24.13107(1).

Similarly, in Van Marter, the father of the insured (who was also the guardian of the insured's estate) sought to recover no-fault benefits for the value of services rendered by the insured's stepmother. The defendant recognized that it was obligated to pay for the value of the services under Visconti, but claimed that the three-year limitation period for replacement services was applicable. This Court agreed with the trial court that the services were compensable under M.C.L. § 500.3107(a); M.S.A. § 24.13107(a) (now M.C.L. § 500.3107[a]; M.S.A. § 24.13107[a] ) and the three-year limitation period did not apply to the services the stepmother was rendering to the insured.

This Court has extended the principles of Visconti and Van Marter in Reed v. Citizens Ins. Co. of America, 198 Mich.App. 443, 499 N.W.2d 22 (1993), and Botsford General Hosp. v. Citizens Ins. Co., 195 Mich.App. 127, 489 N.W.2d 137 (1992).

In Reed, supra at 450, 499 N.W.2d 22, the issue was whether room and board is an allowable expense "when the insured who could be institutionalized is cared for at home.". The Court, id. at 452, 499 N.W.2d 22, noted, "family members may be compensated for the services they provide at home to an injured person in need of care," and cited Van Marter. The Court then extended the reasoning of those cases to hold that "where an injured person is unable to care for himself and would be institutionalized were a family member not willing to provide home care, a no-fault insurer is liable to pay the cost of maintenance in the home." Reed, supra at 453, 499 N.W.2d 22.

In Botsford, the defendant argued that the plaintiff did not prove that he incurred any expenses for replacement services. See M.C.L. § 500.3107(1)(c); M.S.A. § 24.13107(1)(c). The plaintiff's wife testified that she mowed the grass, took out the trash, shoveled the sidewalk, and went to the store when the plaintiff would normally have done so. This Court stated that case law "permits the recipient of no-fault PIP benefits to recover for replacement services provided by family members," Botsford, supra at 142, 489 N.W.2d 137, and affirmed the jury award for those services. According to the Court, whether the plaintiff was entitled to collect the value of the replacement services and the determination of the value were properly left for the jury to decide. Id. at 143, 489 N.W.2d 137.

In this case, defendant argued and the trial court agreed that the value of the care provided to plaintiff was not an allowable expense because plaintiff was not charged by her parents for those services. Pursuant to M.C.L. § 500.3107(1)(a); M.S.A. § 24.13107(1)(a), allowable expenses consist "of all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person's care, recovery, or rehabilitation." According to defendant's argument, no charges for the service provided by plaintiff's parents have been "incurred." Although this Court has not addressed this precise argument in any published opinion that we have located, accepting such an argument would be inconsistent with the holdings in Visconti, Van Marter, Reed, and Botsford. In each of those cases, this Court implicitly held that "charges" or "expenses" had been "incurred" without requiring that the insured was actually billed by the family. ¹ We decline to create such a requirement in this case. As in Botsford, supra at 143, 489 N.W.2d 137, whether the plaintiff was entitled to collect the value of the services and the determination of the value are matters properly left for the jury to decide. Defendant was not entitled to summary disposition on this basis.

Next, we consider whether defendant was entitled to summary disposition because, by choosing her parents to provide services, plaintiff failed to make a reasonable effort to obtain benefits available under the WDCA, and thus was precluded from recovering from defendant for those services.

Because of the limitation in § 315(1) of the WDCA, plaintiff could not receive worker's disability compensation for more than fifty-six hours of "[a]ttendant or nursing care" provided by her parents. However, no such time limitation applies when the care is provided by someone other than the "employee's spouse, brother, sister, child, parent, or any combination of these persons." Thus, if plaintiff agreed to be cared for by someone from a commercial agency for 112 hours a week, for example, the entire cost of the care would be compensable under the WDCA.

A no-fault insurer is entitled to set off worker's compensation benefits under § 3109(1) of the no-fault act, M.C.L. § 500.3109(1); M.S.A. § 24.13109(1). Root v. Ins. Co. of North America, 214 Mich.App. 106, 108, 542 N.W.2d 318 (1995). Defendant, relying on Perez v. State Farm Mut. Automobile Ins. Co., 418 Mich. 634, 344 N.W.2d 773 (1984), argues that if an injured person does not exercise a reasonable effort to obtain available worker's compensation benefits, the worker's compensation benefits that were available but not collected are required to be subtracted from any no-fault benefits. According to defendant, plaintiff failed to make reasonable efforts to obtain the full amount of worker's compensation benefits that were available for nursing or attendant care because the entire cost of her care would be compensable under the WDCA if plaintiff used a commercial agency to provide care in excess of the fifty-six hour a week limit imposed by § 315(1) on care provided by plaintiff's parents. Thus, defendant argues, plaintiff's unwillingness to agree to such an arrangement amounts to a failure to use reasonable efforts to obtain benefits available under the WDCA and entitles defendant to set off the cost of her parent's services.

Contrary to defendant's argument, defendant is not entitled to set off the cost of the services provided by plaintiff's parents unless those services are duplicative of benefits required to be paid by the government.

In Morgan v. Citizens Ins. Co. of America, 432 Mich. 640, 442 N.W.2d 626 (198...