Cameron v. Auto Club Ins. Ass'n

Decision Date28 July 2006
Docket NumberDocket No. 127018.,COA No. 3.
Citation476 Mich. 55,718 N.W.2d 784
PartiesDiane CAMERON and James Cameron, Co-Guardians of the Estate of Daniel Cameron, Plaintiffs-Appellants, v. AUTO CLUB INSURANCE ASSOCIATION, Defendant-Appellee.
CourtMichigan Supreme Court

Logeman, Iafrate & Pollard, P.C. (by Robert E. Logeman and James A. Iafrate), Ann Arbor, for the plaintiffs.

Gross, Nemeth & Silverman, P.L.C. (by James G. Gross), and Schoolmaster, Hom, Killeen, Siefer, Arene & Hoehn (by Michael G. Kramer), Detroit, Detroit for the defendant.

Willingham & Coté, P.C. (by John A. Yeager, Matthew K. Payok, and Leon J. Letter), East Lansing, for amici curiae Insurance Institute of Michigan.

Smith & Johnson, Attorneys (by Louis A. Smith), Traverse City, for amici curiae Coalition Protecting Auto No-Fault.

Dykema Gossett P.L.L.C. (by Jill M. Wheaton and Joseph Erhardt), Ann Arbor, for amici curiae Michigan Catastrophic Claims Association.

TAYLOR, C.J.

We granted leave in this case to determine whether the minority/insanity tolling provision of the Revised Judicature Act (RJA), MCL 600.5851(1), applies to toll the "one-year-back rule" in MCL 500.3145(1) of the no-fault automobile insurance act.1 The Court of Appeals, reversing the trial court's denial of defendant's motion for summary disposition, held that it does not, but further concluded that the tolling provision at issue does not apply to the applicable statute of limitations for no-fault actions that is also set out in MCL 500.3145(1).

We affirm the Court of Appeals determination that defendant is entitled to summary disposition, but on narrower grounds. To decide this matter, the Court of Appeals only needed to address whether MCL 600.5851(1) tolls the one-year-back provision in MCL 500.3145(1). Because we conclude that MCL 600.5851(1) cannot toll the one-year-back rule, and all damages sought here were for more than one year back, no damages could be recovered and that disposes of this matter. Accordingly, it was dicta for the Court of Appeals to address the effect of MCL 600.5851(1) on the statute of limitations in MCL 500.3145(1) and we vacate that portion of its ruling while affirming its conclusion that defendant is entitled to summary disposition in this case.

I. FACTS

Daniel Cameron, a minor, suffered a closed head injury resulting in a cognitive disorder when an automobile struck his bicycle in 1996. At the time of the accident, Daniel's parents maintained a no-fault automobile insurance policy with defendant Auto Club Insurance Association under which Daniel was eligible for coverage. In 2002, when Daniel was 16 years old, his parents filed suit on his behalf seeking PIP benefits for attendant care rendered to Daniel from August 1996 to August 1999.

Defendant moved for summary disposition, arguing that plaintiffs'2 claim was barred by the one-year-back rule in MCL 500.3145(1). The circuit court denied defendant's motion and, instead, granted summary disposition in favor of plaintiffs. Thereafter, the circuit court entered a judgment in plaintiffs' favor in the amount of $182,500, an amount stipulated by the parties.

Defendant appealed to the Court of Appeals, which reversed.3 The Court of Appeals held that tolling under MCL 600.5851(1) does not affect the date for bringing an action or limit the one-year-back rule of MCL 500.3145(1).4 The Court therefore concluded that the circuit court had improperly denied defendant's motion for summary disposition.

This Court granted plaintiffs' application for leave to appeal.5

II. STANDARD OF REVIEW

We review de novo a trial court's grant or denial of a motion for summary disposition.6 Questions of statutory interpretation are also reviewed de novo.7 As always, our primary goal when interpreting statutes is to discern the intent of the Legislature by focusing on the best indicator of that intent, the language the Legislature adopted in the statute.8

III. ANALYSIS

As stated above, plaintiffs filed suit in 2002, seeking no-fault automobile insurance benefits for attendant care rendered to Daniel from August 1996 to August 1999. Defendant asserts that this action is barred by MCL 500.3145(1), which provides in relevant part:

An action for recovery of personal protection insurance benefits payable under this chapter for accidental bodily injury may not be commenced later than 1 year after the date of the accident causing the injury unless written notice of injury as provided herein has been given to the insurer within 1 year after the accident or unless the insurer has previously made a payment of personal protection insurance benefits for the injury. If the notice has been given or a payment has been made, the action may be commenced at any time within 1 year after the most recent allowable expense, work loss or survivor's loss has been incurred. However, the 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. [Emphasis added.]

As we recently reiterated in Devillers v. Auto Club Ins Ass'n,9 MCL 500.3145(1) contains two limitations on the time for commencing an action and one limitation on the period for which benefits may be recovered:

"(1) An action for personal protection insurance [PIP] benefits must be commenced not later than one year after the date of accident, unless the insured gives written notice of injury or the insurer previously paid [PIP] benefits for the injury.

"(2) If notice has been given or payment has been made, the action may be commenced at any time within one year after the most recent loss was incurred.

"(3) Recovery is limited to losses incurred during the one year preceding commencement of the action."10

Thus, an action for PIP benefits must be commenced within a year of the accident unless the insured gives written notice of injury or previously received PIP benefits from the insurer. If notice was given or payment was made, the action can be commenced within one year of the most recent loss. Recovery, however, is limited to losses incurred during the year before the filing of the action.

In the present case, although plaintiffs filed their complaint in 2002, more than one year after the date of the accident in 1996, defendant does not dispute that it either received written notice of injury or previously paid benefits and that plaintiffs commenced their action within one year after the most recent loss was incurred. Thus, defendant's sole assertion is that the one-year-back rule bars plaintiffs' claim because the period for which the plaintiffs seek recovery for their losses is August 1996 to August 1999. This, of course, is a period more than one year before the 2002 commencement date of their action. Thus, defendant argues, and the Court of Appeals agreed, no damages are recoverable

In response, plaintiffs contend that the minority/insanity tolling provision in MCL 600.5851(1) applies to toll the one-year-back rule with regard to damages in MCL 500.3145(1) and, as a result, the losses incurred between August 1996 and August 1999 are recoverable. We disagree.

MCL 600.5851(1) provides in relevant part:

[I]f the person first entitled to make an entry or bring an action under this act is under 18 years of age or insane at the time the claim accrues, the person or those claiming under the person shall have 1 year after the disability is removed through death or otherwise, to make the entry or bring the action although the period of limitations has run.

By its unambiguous terms, MCL 600.5851(1) concerns when a minor or person suffering from insanity may "make the entry or bring the action." It does not pertain to the damages recoverable once an action has been brought. MCL 600.5851(1) then is irrelevant to the damages-limiting one-year-back provision of MCL 500.3145(1). Thus, to be clear, the minority/insanity tolling provision in MCL 600.5851(1) does not operate to toll the one-year-back rule of MCL 500.3145(1).

We note that in Geiger v. Detroit Automobile Inter-Insurance Exch,11 our Court of Appeals reached the opposite conclusion and held that the minority/insanity provision in MCL 600.5851(1) does toll the one-year-back rule in MCL 500.3145(1). In reaching this conclusion the Court of Appeals, looking behind the language of the statute and focusing on its understanding of the Legislature's purported intent, determined that the legislative purpose behind the minority/insanity tolling provision for periods of limitations was to preserve not only a person's cause of action during the period of disability but also the person's damage claims. It opined that to not read the statute in this fashion would "severely limit the utility" of the minority/insanity tolling provision. The Court then concluded that, "[i]n order to advance the policy of RJA § 5851," the minority/insanity tolling provision applies to prevent the capping of damages under the one-year-back rule of MCL 500.3145(1).12

We believe this ruling was erroneous for the most uncomplicated reason; namely, that we must assume that the thing the Legislature wants is best understood by reading what it said. Because what was said in MCL 500.3145(1) and MCL 600.5851(1) is clear, no less clear is the policy. Damages are only allowed for one year back from the date the lawsuit is filed. We are enforcing the statutes as written.13 While some may question the wisdom of the Legislature's capping damages in this fashion, it is unquestionably a power that the Legislature has under our Constitution.14 Thus, because Geiger's conclusion that the minority/insanity tolling provision applies to extend the one-year-back rule is contrary to what the Legislature clearly directed in MCL 500.3145(1) and MCL 600.5851(1), Geiger is overruled.

Because we conclude that the minority/insanity tolling provision in MCL 600.5851(1) does not apply to the one-year-back rule in MCL 500.3145(1), we find...

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