Roberts v. Auto Owners Ins. Co.

• Decision Date: 19 September 1984
• Docket Number: Docket No. 64515
• Parties: Delores ROBERTS, As Next Friend Of Christine M. Rodzos, and Delores Roberts and Ralph Roberts, Individually, Plaintiffs-Appellees, v. AUTO OWNERS INSURANCE COMPANY, Defendant-Appellant. 135 Mich.App. 595, 354 N.W.2d 271
• Court: Court of Appeal of Michigan — District of US

Page 271

354 N.W.2d 271

Delores ROBERTS, As Next Friend Of Christine M. Rodzos, and Delores Roberts and Ralph Roberts, Individually Plaintiffs-Appellees, v. AUTO OWNERS INSURANCE COMPANY, Defendant-Appellant.

Docket No. 64515.

135 Mich.App. 595, 354 N.W.2d 271

Court of Appeals of Michigan.

Submitted May 16, 1983.

Decided Oct. 3, 1983.

Released for Publication Sept. 19, 1984.

[135 MICHAPP 596] Bush, Luce, Henderson, Bankson & Heyboer by S. Keith Bankson, Port Huron, for plaintiffs-appellees.

Law Office of W.J. Drillock by David W. Hearsch, Marlette, for defendant-appellant.

Before T.M. BURNS, P.J., and WALSH and SIMON, ^* JJ.

PER CURIAM.

Defendant appeals as of right from a jury verdict awarding plaintiffs $360.36 in damages for breach of the no-fault insurance contract between defendant and plaintiffs, and $2,500 in damages for intentional infliction of emotional or mental distress. Defendant also appeals from the trial court's subsequent award of $5,880 in attorney fees based on defendant's unreasonable delay in paying plaintiffs the benefits they were due under the insurance contract.

Christine Rodzos, a 13-year-old girl was injured [135 MICHAPP 597] when the bicycle she was riding was struck by a motor vehicle. On the following day, April 21, 1979, her stepfather notified defendant's agent. The Roberts's vehicles were covered by a standard "no fault" policy issued by defendant.

Plaintiffs' lawsuit alleging both breach of contract and intentional infliction of mental distress was premised on defendant's interference with plaintiffs' insurance claim for $440 of "replacement services". These services consisted of Delores Roberts's care for Christine after the accident. Mrs. Roberts had to wash Christine's hair to remove the blood, dress her, fix her meals and serve them to her in bed. Mrs. Roberts took a week off from work because of this increased burden. Mr. and Mrs. Roberts drove Christine to the doctor on four occasions.

Mr. Roberts heard nothing since he contacted defendant on April 21, 1979, so he retained an attorney in July, 1979. Plaintiffs' attorney sent defendant a letter informing it that Christine had severe facial injuries that would require further surgery. Defendant responded with an application for no-fault benefits. Defendant eventually paid the ambulance bill on August 31, 1979, after plaintiffs' attorney sent two requests. Along with this payment, defendant informed plaintiffs that it did not have a form for replacement services. Plaintiffs, with the assistance of their attorney, then prepared and submitted an "Affidavit Regarding Replacement Services", which requested replacement service benefits of $440. Defendant replied that most of the requested benefits would not be paid and that a doctor would have to verify the ones that would be paid. On March 10, 1980, plaintiffs finally filed their complaint against defendant.

[135 MICHAPP 598] At the conclusion of the trial, the jury returned a verdict agreeing that amounts were owed, and judgment was entered as follows:

"Judgment be and hereby is entered in favor of Plaintiffs vs. Defendant as follows:

"A. $ 360.36 Unpaid benefits

"B. 57.96 Section 3142(3) interest

"C. 2,500.00 Emotional distress

"D. 5,880.00 Section 3148 attorney fee

"E. 425.00 Taxable costs

"F. 700.32 M.C.L.A. Sec. 600.6013 interest for a total Judgment of Nine Thousand Nine Hundred Twenty-Three Dollars and Sixty-Four Cents ($9,923.64)."

On appeal, defendant raises several issues. We note, however, that in its motion for new trial defendant only contests the validity of the award for damages for mental distress. Defendant now argues that this award was contrary to the rule set forth in Kewin v. Massachusetts Mutual Life Ins. Co., 409 Mich. 401, 423, 295 N.W.2d 50 (1980), where the Supreme Court found that the plaintiffs did not prove intentional infliction of emotional distress because they "alleged and proved no more than the failure of the defendant to discharge its obligations under the disability insurance contract". The essence of the Kewin decision is that the insurer is not liable for intentional infliction of emotional distress for merely failing to pay benefits allegedly due the insured.

This case involves significantly more than the mere failure to pay benefits. Plaintiffs' case is based upon allegations of defendant's intentional attempts to frustrate them from applying for benefits. Plaintiffs allege that defendant was informed of the nature and extent of Christine's injuries and [135 MICHAPP 599] the costs of the services incurred therefrom but only supplied an application for a small portion of the payable benefits. Defendant claims that six years after the enactment of the no-fault statute it did not have application forms for the benefits plaintiffs requested under the act. This forced plaintiffs to procure counsel to apply for no-fault benefits. Considering the fact that defendant was informed that Christine had a severe facial scar that might necessitate plastic surgery, its conduct in frustrating plaintiffs' attempts to apply for benefits and define the limits of the policy could properly be considered as extreme and outrageous by a jury. Frishett v. State Farm Mutual Automobile Ins. Co., 3 Mich.App. 688, 692-693, 143 N.W.2d 612 (1966).

While the mere breach of an insurance contract has been held insufficient to support a claim for intentional infliction of emotional distress, Kewin v. Massachusetts Mutual Life Ins. Co., supra, Butler v. DAIIE, 121 Mich.App. 727, 329 N.W.2d 781 (1982), the fact that one sells insurance does not create an immunity from this tort.

It is initially for the court to determine whether defendant's conduct may be reasonably regarded as so extreme and...