Michigan Court of Appeals; Docket # 339005; Unpublished
Judges Jansen, Kelly, and Borrello per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion; Partial Concurrence and Dissent
In this 2-1 per curiam opinion the Court of Appeals reversed the trial court’s grant of summary disposition in favor of Defendant Auto Owners Insurance Co (“Auto Owners”) regarding whether Plaintiff Charles Ross’ (“Ross”) was no longer entitled to claim benefits due to his alleged fraud. The Court reversed the trial court because it found there were questions of fact whether Ross committed fraud. Namely there was conflicting testimony regarding Ross’ work schedule, conflicting testimony if Ross left his job, and there was no paper record of Ross’ work history.
In November 2014, Ross was injured in a motor vehicle accident and filed a complaint against Auto Owners for PIP benefits. Auto Owners refused to pay PIP benefits to Ross because it asserted that Ross had breached the anti-fraud clause in the no-fault contract. Auto Owner asserted that Ross did not work for BMT, Inc. (“BMT”) as he had alleged. Auto Owners pointed to the testimony of Cecil Clark (“Clark”) who stated that Ross stopped working at BMT sometime in October. Ross however argued that he in fact did work at BMT, but worked odd hours and Clark was unlikely to see him. It was agreed that Ross worked on a party bus and worked at night. Further, Ross’ work at BMT took him away from the bar since he had to be out with the party bus. During the day Ross often was away from the bar because he was disturbing flyers in other restaurants and bars. Ross’ time with BMT was not formally kept and all records of his employment were destroyed. Finally, Clark appeared to be unsure of when he believed Ross left BMT, first he stated that Ross left in the summer of 2014, and then he said that Ross left in September or October of that year.
The Court found that there was a genuine issue of material fact regarding Ross’ employment at BMT because there was conflicting testimony and the trial judge appeared to make a credibility determination. The Court cited to Shelton v Auto Owners Ins Co, 318 Mich App 648, 658-660; 899 NW2d 744 (2017) and explained that in that case the Court found that one instance of wringing out a shirt did not prove that the defendant committed fraud when she claimed she was incapable of doing laundry. The Court drew parallels with Shelton and found that there was a genuine issue of material fact. First, the statements of Ross and Clark directly contradicted each other. Second, there was no official record of Ross being let go from BMT. Third, Ross seemed to provide a reasonable explanation for why Clark would believe he no longer worked at BMT (his work outside of the bar, his work at night, and his work distributing flyers in other bars). Fourth, Clark’s testimony was “not unequivocal” and he changed the dates when he believed Ross was let go from BMT. Fifth, the Court found that it was inappropriate for the trial court to make a credibility determination –finding Clark to be more credible— when deciding a motion for summary disposition.
“According to plaintiff’s deposition testimony, his work would take him on the party buses on the weekends. In the time preceding the motor vehicle accident, in October 2014, according to plaintiff’s affidavit filed in this case, he was “doing a lot of promotions [for] the party buses” as Halloween approached. Plaintiff’s work would take him away from the bar, and he would attend “many concerts and bar hopping events with the party bus” during that time period. . . Clark may have testified that plaintiff no longer worked for BMT because “[Ross and Clark] may had just missed seeing each other whenever [Ross] was working.” . . . . In contrast, Clark’s testimony on plaintiff’s alleged termination from employment with BMT was certainly not unequivocal. . . . BMT did not keep employment records for plaintiff, once plaintiff was paid for his time any written record was destroyed by BMT staff.”
The Court also reversed the trial court’s grant of summary disposition for work-loss benefits because the same issue of fact applied to MCL 500.3107. Thus, the Court reversed the trial court and found that there was a genuine issue of material fact.
Concurrence and partial dissent
Judge Jansen dissented regarding the work-loss benefit but concurred in finding the rest of the PIP benefits were not barred by fraud. Judge Jansen dissented because she found Ross’ testimony to be self-serving and unsupported by other evidence. Judge Jansen explained that Ross did not provide any pay stubs or canceled checks or witnesses to support his claim. Because Ross failed to show that he was employed by BMT Judge Jansen would have upheld summary disposition for Auto Owners.