Gobler v. Auto Owners Ins. Co.

• Decision Date: 22 February 1985
• Docket Number: Docket No. 63718
• Citation: 362 N.W.2d 881,139 Mich.App. 768
• Parties: Linda K. GOBLER, Plaintiff-Appellee, v. AUTO OWNERS INSURANCE COMPANY, Defendant-Appellant.
• Court: Court of Appeal of Michigan — District of US

Page 881

362 N.W.2d 881

139 Mich.App. 768

Linda K. GOBLER, Plaintiff-Appellee, v. AUTO OWNERS INSURANCE COMPANY, Defendant-Appellant.

Docket No. 63718.

Court of Appeals of Michigan.

Submitted Jan. 3, 1984.

Decided Dec. 18, 1984.

Rehearing Denied Feb. 5, 1985.

Released for Publication Feb. 22, 1985.

James G. Halverson & Associates, P.C. by James G. Halverson, Lansing, for plaintiff-appellee.

Denfield, Timmer & Taylor by John W. Cotner, Lansing, for defendant-appellant.

Before KELLY, P.J., and ALLEN and HOFFIUS ^*, JJ.

PER CURIAM.

This is an action to recover survivor's benefits pursuant to § 3108 of the no-fault act, M.C.L. § 500.3108; M.S.A. § 24.13108. Following a bench trial, the trial court entered judgment for plaintiff in the amount of $24,985. Plaintiff was also awarded 12% per annum penalty interest and attorney fees. Defendant appeals as of right.

Plaintiff is the surviving widow of Steven Gobler, who was killed in an automobile accident on March 16, 1976. Defendant was Steven Gobler's no-fault automobile insurer. At the time of his death, Gobler was unemployed and had just completed his last final exam as a full-time college student at Michigan State University. He had completed his work toward a degree in forestry.

At the time of Steven Gobler's death, his plans were to pursue a career in forestry on the West Coast. In filing the application for survivor's benefits, plaintiff Linda Gobler answered the question on the form relative to her deceased husband's employer, occupation, and dates of employment by stating, "None, student at MSU". Defendant paid the ambulance bill, hospital bill, and funeral bill for the deceased but denied survivor's benefits to plaintiff based upon the fact that Steven Gobler was unemployed at the time of his death.

In December, 1977, plaintiff filed a complaint for breach of the insurance contract, unreasonable refusal to pay, and fraud and bad faith, seeking survivor's benefits, penalty interest, attorney fees, and exemplary damages. In January, 1980, the trial court granted defendant partial accelerated judgment on the one-year statute of limitations, which barred plaintiff's claim for survivor's benefits for nine months following decedent's death and limited her claim to 27 months.

At the trial in November, 1981, there was evidence that plaintiff and the deceased were married in 1971. Both attended school and worked part-time. Plaintiff and the deceased lived together sharing expenses and income.

Steven Gobler was last employed from July to November, 1975, by the U.S. Forestry Service, and had earned $4,064.86. He then returned to Michigan State University as a full-time student in January, 1976, and continued as a student without any employment until the date of the accident, which was the day he took his last final exam.

Steven Gobler's last full-time employment, before becoming a full-time student at Michigan State University, was in 1973 with the Pontiac Motors Division of General Motors Corporation, where he had earned $11,113.16. He worked a short time in summer employment in 1975 at the Pontiac Division of General Motors and earned less than $300.

Prior to his death, Steven Gobler had filed an application with the U.S. Forestry Service on the Civil Service Register. His name appeared on a certificate of eligibility issued by the Civil Service Commission. Six months after Gobler's death, in September, 1976, a letter was received by plaintiff, addressed to decedent, which contained a form, entitled "Inquiry of Availability," inquiring about the availability of all eligibles, including Steven Gobler, for employment. At the trial, the trial judge sustained defendant's objection to the testimony of Shelagh Reed, who was employed as a U.S. Forestry Service staffing specialist in 1976. A separate record was taken of her testimony, as the court ruled that such testimony was irrelevant and immaterial.

Shelagh Reed, staffing specialist responsible for recruiting employees for the U.S. Forestry Service, testified that she sent the inquiry of availability to six persons on the Civil Service Register to find out who was available to fill three open positions. The position, which was the subject of the inquiry, carried a definite salary, benefit level, and commencement date. Only one of the six replied to the inquiry as being available and that person was offered a position. Ms. Reed testified that, had he indicated availability, it was likely that Steven Gobler would have been offered a position.

At the conclusion of the trial, the trial judge found, based on Gobler's past record of schooling and employment, that Gobler would have sought and secured full-time employment. The judge concluded that plaintiff had shown by a preponderance of evidence that Gobler's wages would have been contributed to plaintiff's support and determined that the award should be based on the annualization of $4,064.86, plus interest, that Gobler had earned from his last employment. Plaintiff was also awarded penalty interest and attorney fees.

Defendant filed written objections to the proposed judgment. Relying on Lewis v. Detroit Automobile Inter-Ins. Exchange, 90 Mich.App. 251, 282 N.W.2d 794 (1979), the trial judge reversed his earlier ruling and said he would consider the testimony of Shelagh Reed. The trial judge awarded plaintiff survivors' benefits based on what Steven Gobler would have earned working for the U.S. Forestry Service. Plaintiff was further awarded an attorney fee of one-third of the total sum of the judgment and penalty interest.

The primary issue raised in this appeal is whether the trial court properly found that plaintiff was entitled to survivor's benefits and, if so, how those benefits should be calculated. At the times relevant to this action, § 3108 read in pertinent part:

"Personal protection insurance benefits are payable for a survivors' loss which consists of a loss, after the date of which the deceased died, of contributions of tangible things of economic value, not including services, that dependents of the deceased at the time of his death would have received for support during their dependency from the deceased if he had not suffered the accidental bodily injury causing death * * *. The benefits payable for survivors' loss in connection with the death of a person in a single 30-day period shall not exceed $1,000.00 and is [sic] not payable beyond the first 3 years after the date of the accident." M.C.L. § 500.3108; M.S.A. § 24.13108.

Under § 3110(1)(a), M.C.L. § 500.3110(1)(a); M.S.A. § 24.13110(1)(a), plaintiff is conclusively presumed to be a dependent of Steven Gobler. The trial court's finding that Steven Gobler would have contributed his wages to plaintiff's support is not clearly erroneous. GCR 1963, 517.1. Defendant's argument, that a survivor must prove the amount he or she would actually receive for the survivor's own individual support, is without merit. This would allow a deduction of a personal consumption factor contrary to the express ruling of Miller v. State Farm Mutual Automobile Ins. Co., 410 Mich. 538, 302 N.W.2d 537 (1981).

Defendant argues that the trial court improperly considered the testimony of Shelagh Reed in determining if plaintiff was entitled to survivor's benefits based on lost income. We disagree. Although Steven Gobler was unemployed at the time of the accident, the testimony of Shelagh Reed was relevant to determining under § 3108 what amount, if any, plaintiff "would have received for support * * * from the deceased if the deceased had not suffered the accidental bodily injury causing death * * * ". (Emphasis added.) Moreover, § 3110(4) provides that "[p]ersonal protection insurance benefits payable for accidental bodily injury accrue not when the injury occurs but as the allowable expense, work loss or survivors' loss is incurred". M.C.L. § 500.3110(4); M.S.A. § 24.13110(4) (emphasis added). Thus, we do not agree with defendant's contention that the Legislature intended that survivors be compensated for lost income only if they can prove that the deceased was employed on the date of death.

Section 3107(b) provides for work-loss benefits, "consisting of loss of income from work an injured person would have performed during the first 3 years after the date of the accident if he had not been injured * * * ". M.C.L. § 500.3107(b); M.S.A. § 24.13107(b) (Emphasis added.) M.C.L. § 500.3107a; M.S.A. § 24.13107(1) provides work-loss benefits for an injured person who is temporarily unemployed based on earned income for the last month employed full time...