Providence Hosp. v. National Labor Union Health and Welfare Fund, Docket No. 93298

• Court: Court of Appeal of Michigan (US)
• Writing for the Court: BORRADAILE
• Citation: 412 N.W.2d 690,162 Mich.App. 191
• Parties: PROVIDENCE HOSPITAL, Assignee of Eugene Cummins, Robert French, Alice Johnson, Ronald Lee, Marie Malane, Frank Pearson, Stanley Tekieli, Michelle Vannester, Thelma Bynum, Charlene Delaney, Carlton Johnson, Clarence Mayrick, Ronald Stamis and Clyde Suppi, Plaintiff-Appellee, v. NATIONAL LABOR UNION HEALTH AND WELFARE FUND, Defendant-Appellant. 162 Mich.App. 191, 412 N.W.2d 690
• Docket Number: Docket No. 93298
• Decision Date: 01 October 1987

Page 690

412 N.W.2d 690 PROVIDENCE HOSPITAL, Assignee of Eugene Cummins, Robert
French, Alice Johnson, Ronald Lee, Marie Malane, Frank
Pearson, Stanley Tekieli, Michelle Vannester, Thelma Bynum,
Charlene Delaney, Carlton Johnson, Clarence Mayrick, Ronald
Stamis and Clyde Suppi, Plaintiff-Appellee,
v.
NATIONAL LABOR UNION HEALTH AND WELFARE FUND,
Defendant-Appellant. Docket No. 93298. 162 Mich.App. 191, 412 N.W.2d 690 Court of Appeals of Michigan. Submitted May 8, 1987.
Decided Aug. 3, 1987.
Released for Publication Oct. 1, 1987.

Page 691

[162 MICHAPP 192] Law Offices of Sullivan & Leavitt, P.C. by Martin J. Leavitt and Karen L. Faber, Northville, for plaintiff-appellee.

Zweig & Lane, P.C. by Timothy R. Van Dusen, Southfield, for defendant-appellant.

Before BEASLEY, P.J., and HOOD and E.E. BORRADAILE, ^* JJ.

BORRADAILE, Judge.

Providence Hospital filed suit in Wayne Circuit Court on November 2, 1983, against Health and Welfare Plans, Inc., which is not a party to this appeal, alleging that Health and Welfare Plans, Inc., was contractually bound [162 MICHAPP 193] to pay health benefits to plaintiff's assignors and has a duty to pay plaintiff as an assignee. On May 31, 1984, plaintiff's first amended complaint was filed which alleged that the defendant in this case, National Labor Union Health and Welfare Fund, had breached its contractual obligation to pay for services rendered by plaintiff.

Plaintiff provided health care to certain individuals who were beneficiaries under a multi-employer/employee welfare benefit plan administered by the defendant. The fund is an employee welfare benefit plan within the meaning of the Employee Retirement Income Security Act, 29 U.S.C. Sec. 1002(1). Plaintiff alleged that prior to rendering the services it confirmed with the defendant or its agents that the beneficiaries were covered under the plan and that the services to be provided were covered services. Upon receiving confirmation, plaintiff rendered the services to the beneficiaries and then sought payment from defendant.

Subsequent to plaintiff's rendition of covered services, and after considering all potential available alternatives, on December 23, 1983, the trustees of the fund unilaterally adopted a "plan of arrangement" whereby the trustees determined that, with respect to benefits for services previously provided, the fund would delay making payment until the trustees determined that the fund had sufficient assets. This action was taken in response to a financial crisis experienced by the fund, and was allegedly taken pursuant to the National Labor Union and Welfare Fund Agreement and Declaration of Trust.

The "plan of arrangement" was submitted to providers under the plan, but plaintiff rejected the arrangement and filed the complaint giving rise to this litigation. At oral argument, this Court was informed that the amounts billed had been paid in [162 MICHAPP 194] full but plaintiff sought interest which had been accruing since the trial judge, on February 24, 1986, entered a summary disposition order under MCR 2.116(C)(10) against defendant National Labor Union Health and Welfare Fund only. The amount prayed for in the first amended complaint was $81,467.85.

On May 23, 1986, a stipulation and order of dismissal was entered on the counts against codefendant Health and Welfare Plans, Inc. On March 17, 1986, defendant filed a motion for amendment of judgment alleging that plaintiff's cause of action was preempted by ERISA and that a review of the trustees' decision to modify the method of payment of benefits presented a material issue of fact which was not a proper subject for summary disposition. Finding that the motion, which was nothing more than a motion for rehearing on plaintiff's motion for summary disposition, was untimely, the trial court denied defendant's motion and an order was entered on April 10, 1986. On June 13, 1986, defendant filed a claim of appeal from the April 10, 1986, order. We reverse.

Defendant first raised the preemption question in the motion for amendment of judgment, and because the trial court denied the motion for untimeliness it did not address the preemption issue. Generally, this Court will not review issues that

Page 692

were not raised and decided by the trial court. MCR 7.203; Bajis v. City of Dearborn, 151 Mich.App. 533, 391 N.W.2d 401 (1986), lv. den. 426 Mich. 874 (1986). However, there are exceptions to this general rule. This Court will review issues not raised below if a miscarriage of justice will result from a failure to pass on them, American Way Service Corp. v. Comm'r of Ins., 113 Mich.App. 423, 317 N.W.2d 870 (1982), or if the question is one of law and all the facts necessary for its resolution [162 MICHAPP 195] have been presented, Kahn-Reiss, Inc. v. Detroit & Northern Savings & Loan Ass'n, 59 Mich.App. 1, 228 N.W.2d 816 (1975), or where necessary for a proper determination of the case, Loper v. Cascade Twp., 135 Mich.App. 106, 352 N.W.2d 357 (1984).

Although the complaint does not mention ERISA, 29 U.S.C. 1001 et seq., or specifically allege a violation thereof, the parties do not dispute that the fund, as defined in the trust agreement, is an employee welfare benefit plan as defined in 29 U.S.C. Sec. 1002(1), and is therefore regulated by ERISA.

Defendant, both in brief and in argument, claims that the federal act entirely preempts state law. Defendant asserts that there is no basis for a common-law action as defined under Michigan law that can stand in view of the...