Michigan Court of Appeals; Docket #353991; Unpublished
Judges Kelly, Servitto, and Leticia; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
§500.3112: Payees of PIP Benefits (Service Providers as Payees)
Assignments of Benefits - Validity and Enforceability
In this unanimous unpublished per curiam opinion, the Court of Appeals affirmed the trial court's summary disposition order in favor of Defendant Trumbull Insurance Company ("Trumbull") on the issue of assignment enforceability. The Court of Appeals held that Plaintiff Advance Pain Care, PLLC ("Advance Pain") failed to properly put Trumbull on notice of its assigned rightsby providing only bills for services.
This case arose from a motor vehicle collision in which James Baltimore was injured and received treatment from Advance Pain. Following the collision, the plaintiff received collision-related medical bills from Advance Pain. In connection with receiving that treatment, Baltimore executed numerous assignment agreements that gave Advance Pain the right to receive Baltimore’s no-fault PIP benefits from Trumbull Insurance. Subsequently, Baltimore filed a first-party no-fault action against Trumbull for unpaid PIP benefits, which he ultimately settled for $9,000.
Upon settling his case against Trumbull, he executed a full and unconditional release for “all claims PAST, PRESENT, AND FUTURE for medical benefits/expenses.”The release also stated that Baltimore revoked any and all prior assignments known to defendant that had been “executed in connection with services provided by any medical provider and/or claimant that may otherwise have had a claim against [defendant] . . . for payments or benefits under the Michigan No-Fault Act.”
Thereafter, Advance Pain attempted to claim no-fault benefits pursuant to its assignment. However, Trumbull denied Advance Pain’s claims on the basis of the release it executed with Baltimore. After they were denied, Advance Pain brought an action against Trumbull attempting to recover PIP benefits pursuant to the assignment. However, Advance Pain’s claims were eventually dismissed on summary disposition. In dismissing Advance’s claims, the trial court concluded that Advance Pain failed to perfect its rights under its assignment because it failed to give Trumbull notice that it had acquired an assignment of rights from Baltimore. Although Advance Pain had submitted bills to Trumbull, those bills, by themselves, were not sufficient to put Trumbull on notice that Advance Pain had actually obtained an assignment of rights from Baltimore.
On appeal, the Court of Appeals agreed with the trial court and affirmed the trial court's grant of summary disposition for Trumbull, holding that Advance Pain failed to put Trumbull on notice. The Court noted:
"Because there is neither evidence that plaintiff sent a copy of an assignment to defendant, nor even an assertion by plaintiff that it sent an assignment to defendant, there is no documentary evidence to support the contention that defendant had written notice of plaintiff’s right to payment of no-fault benefits. Thus, the settlement with Baltimore discharged defendant’s liability to plaintiff."
After concluding that summary disposition was properly granted for Trumbull for the foregoing reasons, the Court of Appeals noted that whatever remedy remained for Advance Pain must be pursued against Baltimore. The Court stated:
"The question of whether Baltimore could unilaterally revoke the rights he assigned to plaintiff is an issue to be addressed between Baltimore and plaintiff. As discussed in Physiatry and Rehab Assoc, MCL 500.3112 governs an insurer’s liability or obligation to others once it makes a good faith payment. In Physiatry and Rehab Assoc, Alhalemi executed an assignment, which was presumably not unilaterally revocable. Nonetheless, this Court concluded that MCL 500.3112 governed the defendant’s ability to discharge its liability irrespective of the underlying assignment. Therefore, because defendant made a payment to Baltimore, relying on the settlement and release, defendant’s liability to plaintiff was discharged having not received the proper written notice of a claim, irrespective of an underlying assignment between plaintiff and Baltimore."