In their opinions: We know it’s a double dip but that’s the law

This is a case in which plaintiff chose not to purchase any automobile insurance and, yet, remarkably, the majority rules that plaintiff properly has and will continue to make a profit every time he is treated by a doctor.

– Court of Appeals Judge Henry Saad, dissenting, in Lee v. Farmers Ins. Exchange (unpublished per curiam).

In 1978, Antoine Lee was a passenger in a car. A traffic accident left him seriously injured. He had no insurance and there was no other no-fault coverage available to him. Farmers Insurance Exchange got Lee’s case from the Assigned Claims Facility and paid no-fault PIP benefits.

But Lee also received Medicare coverage to pay of his medical expenses. These dual payments apparently were made for almost 30 years before Farmers balked at paying expenses already covered by Medicare.

Lee sued. Farmers took the position that Lee was double-dipping from both the assigned claims facility and Medicare. Lee argued that the medical expenses were allowable no-fault expenses that Farmers was obligated to pay, even though Medicare had already paid them.

The trial court found for Lee but stayed execution of the $155,000 judgment until Farmers was through with its appeal.

The COA affirmed on a 2-1 vote. The majority opinion noted that a combination of circumstances required judgment for Lee:

  • [T]he Legislature has … specifically permitted recipients of assigned-claims no-fault benefits to receive duplicative compensation from Medicare by making the assigned-claims payment structure partially uncoordinated as to Medicare. Whether or not that is a wise policy choice, the trial court correctly ruled that defendant may not set off the Medicare payments.
  • Because plaintiff’s accident occurred in 1978, it preceded the congressional enactment of the Medicare Secondary Payer provision of the Omnibus Budget Reconciliation Act of 1980, 42 USC 1395y(b)(2)(a), which prevents Medicare from acting as the primary payer for auto accident injuries. The statute only applies to accidents that occurred after December 5, 1980. …
  • We need not address whether any offset would be appropriate under MCL 500.3109(1), however, because that statute, and the case law addressing that statute, contemplates a payee receiving benefits pursuant to some kind of purchased no-fault insurance policy. …
  • [I]t is impossible for MCL 500.3109a to have any bearing: no insurer could have offered plaintiff a coordinated policy because plaintiff had no insurance at all. …
  • MCL 500.3172(2) states that PIP benefits paid by the assigned claims facility “shall be reduced to the extent that benefits covering the same loss are available from other sources,” but further states that Medicare is not one of those “benefit sources.”

The majority acknowledged Saad’s and Farmers’ frustration with the outcome, but explained that “[h]owever anomalous the situation might seem, our Supreme Court has repeatedly instructed that our Court must enforce legislation as written rather than weigh its wisdom.”

The case is Lee v. Farmers Insurance Exchange. (majority opinion) (dissent)

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COA backpedals on published premises case

Earlier this year, Court of Appeals Judge Amy Ronayne Krause, joined by Judges Davis Sawyer and Peter O’Connell, issued for publication a noteworthy premises liability decision, Chesser v. Raddisson Plaza Hotel at Kalamazoo Center.

They’ve apparently had seconds thoughts on the matter. They recently vacated the decision and replaced it with an unpublished opinion.

Chesser, a convention speaker, was injured when she fell from the back of a stage.

The hazard was open and obvious, the panel ruled. There were no guards at the back of the elevated stage and there was a gap between the stage and a wall.

In the original opinion, the panel addressed two issues: Did the hazard have “special aspects” that made it unreasonably dangerous despite its open and obvious nature? And was the hazard effectively unavoidable?

Second question first: The COA rejected a defense argument that Chesser, being aware of the hazard, could have chose not to get on the stage and speak, no matter how awkward or embarrassing that may have been.

Being on defendant’s stage was the primary reason for her presence at defendant’s premises in the first place. Ms. Chesser could technically have avoided the hazard, but she could not have avoided the hazard without completely undermining her use of defendant’s facilities. A condition is “effectively unavoidable” if it cannot be avoided by an invitee without that invitee avoiding the premises altogether. Hoffner v Lanctoe, 290 Mich App 449, 461-464; 802 NW2d 648 (2010), lv pending 489 Mich 877 (2011)[.]

So, what about those “special aspects?” In the original, published opinion, part of the panel’s reasoning that Chesser had no claim included a discussion of other speakers who had crossed the stage without incident. Everyone else made the trip safely. So, the panel reasoned, the hazard was effectively avoidable.

Chesser’s accident was a “statistical fluke,” as Krause put it.

We, and others, found the decision interesting, so we summarized the published case, blogged about it and wrote a news story about it.

Now we’re telling you to forget about it.

On April 5, the COA issued an order vacating Chesser. The order stated a new opinion would be issued.

The new opinion was issued later. It took the COA two tries to get it right.

On April 17, the COA issued an unpublished opinion in Chesser. But unless one knew about the April 5 order, there was no solid indication of the unpublished opinion’s significance.

A quick note: when the COA vacates an opinion, the vacating order is usually accompanied by the replacement opinion, or, when the replacement opinion is issued later, there is usually an order referring back to the order that originally vacated the opinion being replaced.

There must have been a “What’s going on here?” inquiry because two days later, on April 19, the unpublished opinion was released again, with an order vacating the April 17 opinion and the key phrase “ON RECONSIDERATION” (which should have been on the April 17 opinion) displayed on the first page of the unpublished April 19 opinion.

It was an uncharacteristic lapse in the COA’s usually meticulous handling of its opinion releases.

Okay, so administrative miscues aside, what’s the difference between the vacated published version of Chesser and the unpublished, non-binding version of Chesser?

The statistical- fluke discussion is gone, along with the suggestion that Chesser didn’t really have the option of dodging her speaking engagement.

What’s emphasized is that photographs of the accident scene showed an open and obvious hazard, which a reasonable person would have appreciated given the elevation, the tight quarters and the lack of railings or guards.

To the extent the parties were arguing what the photographs showed or didn’t show regarding the hazard from Chesser’s perspective, both parties missed the mark, said the panel in the newly issued opinion. The test is what a reasonable person would have perceived, not Chesser.

Bottom line: the COA issued a published opinion with noteworthy statements about avoiding hazards and calculating whether a hazard is avoidable based on the number of other safe encounters. The COA took that one back and replaced it with a legally less-ambitious opinion resolving an “open and obvious” premises claim.

The published version of Chesser was fun while it lasted.

Put that helmet back on, at least for now

Over the weekend a few motorcycle enthusiasts I know were so eager to take advantage of Michigan’s new “helmet choice” law that they forgot to do one little thing: comply with it.

Senate Bill 291, now Public Act 98 of 2012, lets motorcyclists choose whether to wear a helmet if they have passed a motorcycle safety course or have had their motorcycle endorsement for at least two years, and carry extra insurance. Motorcycle passengers who want to exercise this option also must be 21 or older and carry an additional $20,000 in insurance. It went into effect immediately Friday.

That additional insurance is no-fault person injury coverage also known as PIP coverage. And almost no motorcyclist on the road currently buys it, even though it was available even before the new law, because it’s so expensive, according to Farmington Hills personal injury attorney Steven Gursten.

“I’ve been working with motorcycle accident cases for 20 years and I can count on my fingers the number of clients who actually had motorcycle PIP coverage,” he said.

He added that because the law was only signed by Gov. Rick Snyder on Friday morning, it would have been virtually impossible for anyone who didn’t already have motorcycle PIP coverage to have purchased it before going for a wind-in-their-hair ride.

Not that the $20,000 in coverage would get an injured person very far.

“You can sneeze in an emergency room and use up $20,000 worth of coverage,” Gursten said.

But they’ve got to have it anyway if they plan on riding without a helmet. And they might not even know that they are not in compliance with the law.

“Every insurance agent who has customers with motorcycles needs to call their customers immediately,” Gursten said.

What are the odds?

After Norma Chesser was injured when she fell from a conference center stage, it was obvious that the condition she encountered was open and obvious.

Chesser and others were on the stage to deliver speeches to a conference. The stage was an elevated platform with a podium. There was a row of chairs set close to the back edge for Chesser and others to use while they waited for their turn at the podium.

The back of the platform was not up against a wall and had no railing or other guards. Chesser fell while walking between the chairs and the back edge of the platform.

Any reasonable person in Chesser’s position would have appreciated the hazard, the Michigan Court of Appeals ruled in Chesser v. Raddisson Plaza Hotel at Kalamazoo Center.

But to resolve Chesser’s premises liability claim, “[t]he more difficult question,” wrote COA Judge Amy Ronayne Krause, “is whether the hazardous condition was effectively unavoidable.”

The defense argued that Chesser, aware of the setup on the platform, could have chosen not to go up there.

True enough, Krause acknowledged.

However, the instant situation would not merely have generated awkwardness had Ms. Chesser elected to decline to ascend the stage, unlike the situation in Joyce v Rubin, 249 Mich App 231, 242-243; 642 NW2d 360 (2002).

Being on defendant’s stage [to deliver a speech at a conference] was the primary reason for her presence at defendant’s premises in the first place. Ms. Chesser could technically have avoided the hazard, but she could not have avoided the hazard without completely undermining her use of defendant’s facilities.

A condition is “effectively unavoidable”‘ if it cannot be avoided by an invitee without that invitee avoiding the premises altogether. Hoffner v Lanctoe, 290 Mich App 449, 461-464; 802 NW2d 648 (2010), lv pending 489 Mich 877 (2011) … .

“There is no meaningful difference between avoiding the premises and avoiding using the premises. Just because Ms. Chesser technically could have refused to ascend the stage, the hazard was not therefore effectively avoidable.

Well, defendant pointed out, others, including Chesser, had safely used the same route before Chesser fell.

“This argument has merit,” wrote Krause, “but strictly speaking, it goes too far.”

It’s a matter of the odds.

[I]t is entirely possible for someone to have a stroke of good luck when navigating a hazard, and furthermore, “effectively unavoidable” does not necessarily mean “absolutely unavoidable.”

Consequently, the fact that a plaintiff or other person passed a hazard unscathed does not, all by itself, dispose of whether a hazard is “effectively unavoidable.”

Nevertheless, this argument makes sense as applied to the particular situation before us now. The number of times a hazard is safely bypassed will eventually show that that avoidance of harm is not a statistical fluke.

Indeed, defendant cites to a number of unpublished opinions from this Court, all of which involved situations in which a hazard was faced numerous times by numerous people without any harm befalling them prior to any injury suffered by the plaintiffs.

Krause acknowledged the persuasive-only value of unpublished cases.

[But] [t]he cases cited by defendant are consistent with the most rational way of evaluating the effective unavoidability of a hazard where that hazard has been successfully avoided: the more frequently a hazard is traversed without harm, the more likely it is that the hazard is effectively avoidable. …

The hazard does not appear to have been faced by a great number of people over an extended period of time, but the available evidence shows that the statistical fluke was Ms. Chesser’s fall, not the other speakers’ safety.

Consequently, we conclude that under these circumstances, the facts show that the hazard was not effectively unavoidable.

And there you have it. It’s long odds for plaintiffs in premises cases, and the odds keep getting longer and longer.

Extremely open and obvious

When Wayne Bailey’s teen-aged son ran away from home, Bailey called the Oakland County sheriff.

The sheriff’s department sent Deputy Dominick Spadafore to the scene. It was a cold December night. A narrow path shoveled through the snow led from Bailey’s driveway, up a step to the porch and then to Bailey’s front door.

Spadafore followed the path, went inside and talked things over with Bailey for a half-hour or so.

Okay, you can see this one coming from a mile away: Spadafore finished his conversation with Bailey and headed back to his patrol car. As Spadafore stepped from the porch to the step leading down from it, he slipped, fell and was injured.

The circuit court said the conditions were open and obvious and dismissed Spadafore’s premises liability claim.

The Michigan Court of Appeals affirmed for all the usual reasons: Spadafore saw the conditions as he made his way into Bailey’s home. The same conditions were present when he left. Spadafore admitted the weather conditions were such that snow would melt in sunlight and then freeze after sunset.

“Under these circumstances, a reasonable person in Spadafore’s position would have been able to discover the condition and take self-preserving precautions,” the COA panel ruled.

And there was one other circumstance that put the — ahem — icing — on the cake as far as dismissing the case based on Spadafore’s awareness of the conditions outside Bailey’s house.

During their half-hour talk, Bailey told Spadafore that his son ran away after being asked to shovel the driveway, step and porch, and to spread some salt.

The case is Spadafore v. Bailey.

The (unpublished) premise of ‘premises’: A building on the property

Michael Izenbaard hosted a bachelor party for Nathan Kadau. The two decided to take Michael’s ATV out for a spin with two other partygoers. Michael drove. Nathan stood in the vehicle’s bed.

All was going well until Izenbaard turned onto a dirt path owned by Consumers Energy. The ATV flipped. Kadau was injured.

Kadau sued Izenbaard and his wife. Izenbaard contacted his homeowners insurer, Fremont. Fremont named the Izenbaards and Kadau as defendants in a declaratory judgment action.

The policy provision at issue, in a nutshell, provided that an “insured location” is the insured’s “residence premises,” and also is “any premises used by you in connection with” the residence premises.

Fremont thought it was in good shape in the trial court. The accident occurred about 1,000 feet away from Izenbaard’s house on property owned by someone else. And the property can’t be a “premises” because there are no buildings on it.

The trial court said that coverage must be provided if the accident occurred on a “premises” used in connection with Izenbaard’s residence.

The trial court seized on the word “premises” and observed that courts and dictionaries have defined the word in various ways, and the policy didn’t define the word at all.

The court concluded that the term “premises” was ambiguous and must be construed against Fremont and in favor of coverage for Kadau’s accident.

Fremont fared better in the Court of Appeals.

We’ve got an issue of first impression, said the COA. There is no published Michigan case addressing the matter, the COA observed.

And, the unpublished Court of Appeals opinions and authority from other jurisdictions that the parties cited didn’t “specifically address the meaning of the term ‘premises,'” the COA explained in Fremont Ins. Co. v. Izenbaard, et al., an unpublished per curiam opinion.

The COA consulting several dictionaries. Definitions of “premises” contemplate buildings on land. A “structure” can be a building but it can also be other things, like the power lines and towers that ran along the dirt trail on which Kadau was injured.

Because “premises” is defined in terms of buildings and land, not structures and land, the dirt trail was not a premises even though there were structures on it, the COA concluded.

So, the COA ruled, Fremont is off the hook.

The decision is a decent exercise in construing a contract, but it left a loose end.

If there’s no published authority in Michigan, and nothing on point from other jurisdictions (in other words, no binding precedent) why continue to add to a growing body of persuasive authority on the issue?

Why not issue the decision for publication?

MSC’s Young: COA slip-and-fall ruling ‘defies common sense’

A Court of Appeals ruling that a jury should decide whether soap residue in a YMCA shower is an open and obvious danger is “flabbergasting,” says Michigan Supreme Court Chief Justice Robert P. Young Jr.

Milagros Dascola slipped and fell in the women’s shower at a Lansing YMCA. The case went to trial. At the close of proofs, the trial court granted Dascola’s motion for a directed verdict, ruling as a matter of law that soap scum on the shower floor was not an open and obvious condition.

The case went to the jury on the remaining issues. The verdict was $110,000; Dascola was found 40 percent negligent. The trial court entered a $62,000 judgment.

In a split decision, the COA, in Dascola v. YMCA of Lansing (majority opinion) (dissent), reversed and remanded for a new trial. The majority ruled that the open and obvious issue should have gone to the jury. The dissent, although not openly flabbergasted, said the trial court should have granted the YMCA’s motion for a directed verdict as a matter of law on the open-and-obvious issue and dismissed the case.

Dascola appealed. The MSC denied leave.

In a concurring opinion, Young, joined by Justice Stephen J. Markman, did a little coaching from the bench for the defense while explaining his vote to deny leave:

There is no question that, under Michigan’’s well-established premises liability law, the presence of water and soap residue in a public shower constitutes open and obvious dangers.

As such, these conditions do not give rise to liability for a premises owner, and I believe that the lower courts clearly erred in not reaching this conclusion as a matter of law. However, because defendant has not filed a cross-appeal in this Court challenging the lower court’s determination that defendant is not entitled to summary disposition, I concur in the Court’s order denying leave to appeal.

But Young had some choice words about the notion that there could be any factual dispute about the open-and-obvious issue in this case:

[T]he conclusion by the majority of the Court of Appeals that a question of fact exists regarding whether soap residue in a shower presents an open and obvious danger is, quite frankly, flabbergasting. Even a casual review of this state’s premises liability and “open and obvious” caselaw compels the conclusion that any danger created by soap residue in a public shower presents an open and obvious condition.

Although the proposition is so self-evident that it hardly merits stating, it is within common understanding that the flat tiled surfaces that comprise a shower will by their nature become wet and can therefore become slippery, particularly when soap or similar products are used. It is hardly surprising that soaps, shampoos, or other bathing substances will be used in a shower and may leave residue or “soap scum” on the shower’s surface. That such surfaces may become slippery represents a quintessential “open and obvious” hazard.

Moreover, there were no special attributes to this shower that rendered it uniquely or unreasonably dangerous. A reasonably prudent person of ordinary intelligence understands that a wet public shower poses a slip-and-fall hazard, particularly where soap or other residue may be present on the shower’s surface.

The conclusion of the Court of Appeals majority holding that there is a question of fact in this regard defies common sense.