Insurance Com'r v. Aageson Thibo Agency

• Decision Date: 07 November 1997
• Docket Number: Docket No. 191342
• Citation: 226 Mich.App. 336,573 N.W.2d 637
• Parties: American Commercial Liability Insurance Company and INSURANCE COMMISSIONER, Plaintiffs-Appellants, v. AAGESON THIBO AGENCY, et al., Defendants-Appellees.
• Court: Court of Appeal of Michigan — District of US

Page 637

573 N.W.2d 637

226 Mich.App. 336

American Commercial Liability Insurance Company and INSURANCE COMMISSIONER, Plaintiffs-Appellants, v. AAGESON THIBO AGENCY, et al., Defendants-Appellees.

Docket No. 191342.

Court of Appeals of Michigan.

Submitted April 9, 1997, at Lansing.

Decided Nov. 7, 1997, at 9:00 a.m.

Released for Publication Feb. 10, 1998.

Frank J. Kelley, Attorney General, Thomas L. Casey, Solicitor General, and Dickinson, Wright, Moon, Van Dusen & Freeman by Joseph A. Fink, Jeffery V. Stuckey, and David E. Pierson, Special Assistant Attorneys General, for Plaintiffs-Appellants.

Mika, Meyers, Beckett & Jones, P.L.C. by Michael A. Zagaroli, Grand Rapids, for Defendants-Appellees.

Before MICHAEL J. KELLY, P.J., and WAHLS and GAGE, JJ.

PER CURIAM.

In this action to recover insurance policy commissions paid to defendants, plaintiffs American Commercial Liability Insurance Company (ACLIC), in liquidation, and the insurance commissioner, in his capacity as liquidator, appeal as of right from the Ingham Circuit Court's order granting summary disposition to defendants pursuant to MCR 2.116(C)(7). The court applied the two-year statute of limitation set forth in M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) and found that plaintiffs' claims were time-barred. We affirm.

Pursuant to his authority under chapter 81 of the Insurance Code governing the supervision, rehabilitation, and liquidation of insolvent insurance companies, M.C.L. § 500.8101 et seq.; M.S.A. s24.18101 et seq., the insurance commissioner commenced liquidation proceedings against ACLIC in the Ingham Circuit Court. ¹ The court ordered ACLIC into liquidation on March 2, 1992. In February and March of 1994, plaintiffs filed complaints against defendants, the former agents of ACLIC, claiming that the commission payments made to defendants during the year preceding the order of liquidation constituted preferential transfers recoverable under M.C.L. § 500.8128; M.S.A. § 24.18128. In June 1994, the Legislature enacted 1994 P.A. 226 in which it amended the preference provisions of the Insurance Code to exempt expressly agents' commissions from recovery as preferential transfers in proceedings commenced after January 1, 1990. ² On November 18, 1994, plaintiffs moved to amend the complaints. Following the trial court's grant of leave to amend, plaintiffs filed amended complaints on February 7, 1995, in which they stated that their actions to recover the commission payments were being brought pursuant to M.C.L. § 500.8121(1); M.S.A. § 24.18121(1) and M.C.L. § 500.8133; M.S.A. § 24.18133.

M.C.L. § 500.8121(1)(f); M.S.A. § 24.18121(1)(f) grants the insurance commissioner broad powers, in his role as liquidator of an insurance company, including the power to "collect all debts and money due and claims belonging to the insurer, wherever located." M.C.L. § 500.8133(1); M.S.A. § 24.18133(1) provides in pertinent part:

An agent, premium finance company, or any other person, other than the insured, responsible for the payment of a premium held by him or her shall be obligated to pay any unpaid earned premium due the insurer at the time of insolvency. The liquidator shall also have the right to recover from that person any part of an unearned premium that represents that person's commission.

The Ingham Circuit Court granted summary disposition for defendants, concluding that the two-year limitation period in M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) was applicable to plaintiffs' claims. M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) provides in pertinent part:

The liquidator may, upon or after an order for liquidation, within 2 years or such time in addition to 2 years as applicable law may permit, institute an action or proceeding on behalf of the estate of the insurer upon any cause of action against which the period of limitation fixed by applicable law has not expired at the time of the filing of the petition upon which the order is entered. (Emphasis added.)

The court determined that because plaintiffs did not file their amended complaints within two years of the liquidation order, the claims were time-barred. In granting summary disposition to defendants, the court stated:

It's my opinion that the cause of action in this matter was created by the statute. And that the agents should have been sued within the two-year period, otherwise, I can't imagine any cases where there would be a two-year period for this statute to have any effect. There was no six-year period running. There was no period created or anything other than the two-year period created here.

* * * * * *

[T]his action was created solely by the actions of ACLIC in going insolvent. .... This was not an independent personal action.... It is still a statutorily created action that the two years applies to. If they had already been suing these people for returning a premium because of some other breach, sure, you've got your time. But you don't have that here.... That's the court's opinion on this.

This Court reviews a circuit court's grant of summary disposition de novo. Citizens Ins. Co. of America v. Buck, 216 Mich.App. 217, 221, 548 N.W.2d 680 (1996). Whether a cause of action is barred by the statute of limitations is a question of law that is reviewed under the same standard. Moll v. Abbott Laboratories, 444 Mich. 1, 26, 506 N.W.2d 816 (1993).

Plaintiffs present two distinct arguments to preserve their claims. First, they contend that M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) is merely a tolling statute, which extends any open statute of limitation for a period of two years and preserves any actions that may have been on the verge of being barred when the order of liquidation was entered. In other words, plaintiffs argue that the Legislature intended that § 8124 always give a liquidator more time to bring a claim on behalf of the liquidating insurer and that the section does not itself serve as a separate statute of limitation.

Next, plaintiffs contend that one of three alternative theories of recovery are "applicable law" within the meaning of M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) and that longer limitation periods therefore should be applied to their claims against defendants. They argue that their claims were actually one of the following: contract actions subject to the six-year limitation period provided in M.C.L. § 600.5807(8); M.S.A. § 27A.5807(8), personal actions with a six-year limitation period as provided in M.C.L. § 600.5813; M.S.A. § 27A.5813, or claims to enforce a noncontractual money obligation founded upon a judgment with a ten-year limitation period as provided in M.C.L. § 600.5809; M.S.A. § 27A.5809.

We disagree with each of plaintiffs' arguments and do not find that any of the suggested alternative theories of recovery apply to plaintiffs' claims. We hold that the Ingham Circuit Court properly determined that the two-year statute of limitation provided by M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) barred plaintiffs' claims against these defendants.

Initially we reject plaintiffs' argument that this statute is merely a tolling provision that allows two years to be added to any other applicable statute of limitation. The primary goal of judicial interpretation of statutes is to ascertain and give effect to the intent of the Legislature. Farrington v. Total Petroleum, Inc., 442 Mich. 201, 212, 501 N.W.2d 76 (1993). The Legislature is presumed to have intended the meaning it plainly expressed. Institute in Basic Life Principles, Inc. v. Watersmeet Twp. (After Remand), 217 Mich.App. 7, 12, 551 N.W.2d 199 (1996). The first criterion in determining intent is the specific language of the statute. House Speaker v. State Administrative Board, 441 Mich. 547, 567, 495 N.W.2d 539 (1993). M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) states that claims in a liquidation proceeding must be brought "within 2 years" or "such time in addition to 2 years as applicable law may permit." This language plainly provides a limitation period of two years for actions brought under the Insurance Code but acknowledges that another limitation period, provided by other applicable law, may apply to claims brought during a liquidation proceeding. In other words, the Legislature intended that § 8124 act as both a two-year statute of limitation for actions brought pursuant to chapter 81 of the Insurance Code and as a tolling provision for actions in which applicable law provides a different limitation period.

We further find that plaintiffs' claims against defendants clearly fall within the ambit of the statute of limitation function of M.C.L. § 500.8124(2); M.S.A § 24.18124(2). In determining whether an action is of a type subject to a particular statute of limitation, we look at the basis of the plaintiffs' allegations. Aldred v. O'Hara-Bruce, 184 Mich.App. 488, 490, 458 N.W.2d 671 (1990). The type of interest allegedly harmed is the focal point in determining which limitation period controls. Id. Statutes that relate to the same subject or share a common purpose are in pari materia and must be read together as one law, even if they contain no reference to one another and were enacted on different dates. State Treasurer v. Schuster, 215 Mich.App. 347, 352, 547 N.W.2d 332 (1996). Plaintiffs brought their causes of action against defendants pursuant to the insurance commissioner's authority under chapter 81 of the Insurance Code, which governs the supervision, rehabilitation, and liquidation of insurance companies. The interest allegedly harmed was that of the liquidator in marshaling the assets of the corporation in liquidation. Reading the statutes in chapter 81 together, we find that the Legislature plainly intended the two-year statute of limitation set forth in M.C.L. § 500.8124(2); M.S.A. § 24.18124(2) to apply under circumstances such as these.

Moreover, it is reasonable to conclude that, in the present case, the authority of the liquidator to recover...