Michigan Court of Appeals; Docket #352522; Unpublished
Judges Cavanagh, Kelly, and Redford; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Injunctive and Equitable Relief in PIP Cases
SUMMARY:
In this unanimous unpublished per curiam decision, the Court of Appeals reversed the trial court’s denial of Defendant State Farm Mutual Automobile Insurance Company’s (“State Farm”) motion for summary disposition, in which State Farm sought dismissal of Intervenor-Plaintiffs Renaissace Chirporactic, PC (“Renaissance”), Centrium Physical Therapy PC (“Centrium”), and Core Healing Body Works, LLC’s (“Core Healing”) action against it, in which the intervenor-plaintiffs sought reimbursement for the treatments they provided to State Farm’s insured, Erika Tyler, after Tyler was injured in a motor vehicle collision. The intervenor-plaintiffs sought reimbursement under a theory of unjust enrichment, but the Court of Appeals held that their lawsuit was merely a first-party action governed by the no-fault act. In other words, they could not invoke the doctrine of unjust enrichment to bypass the provisions of the no-fault act and pursue unpaid PIP benefits from State Farm.
Erika Tyler, State Farm’s insured, was injured in a motor vehicle collision and received treatment from Renaissance, Centrium, and Core Healing. Tyler filed a first-party lawsuit against State Farm, but due to her repeated violations of court orders, the trial court eventually granted State Farm’s motion to dismiss her first-party action against it. In the order of dismissal, however, the trial court wrote, “ ‘It is further ordered that this dismissal does not prevent the rights of medical providers to intervene.’ ”
Approximately one month later, Renaissance, Centrium, and Core Healing obtained assignments from Tyler and intervened, seeking to obtain reimbursement of $62,215 worth of medical treatment they rendered to Tyler. They filed a complaint alleging two counts—account stated and unjust enrichment. State Farm moved for summary disposition, arguing that the intervenor-plaintiffs’ lawsuit was actually a first-party no-fault action governed entirely by the no-fault act, and that the intervenor-plaintiffs could not, therefore, invoke the doctrine of unjust enrichment to sidestep the provisions of the no-fault act which barred their cause of action—e.g., the one-year-back rule. The trial court denied State Farm’s motion, ruling that a question of fact existed as to whether State Farm “ ‘received and retained a benefit from [intervenors] and inequity has resulted from such retention.’ ”
The Court of Appeals reversed the trial court’s denial of State Farm’s motion for summary disposition, noting preliminarily that the doctrine of unjust enrichment involves implying a contract where an express contract covering the same subject matter does not exist. In this case, there was an express contract covering the same subject matter: that between Tyler and State Farm. State Farm’s obligation to pay for the treatment the intervenor-plaintiffs rendered to Tyler arose entirely from Tyler’s automobile insurance contract with State Farm. Therefore, the trial court erred in ruling that the doctrine of unjust enrichment was applicable to this case.
“ ‘When unjust enrichment exists, the law operates to imply a contract in order to prevent it.’ Keywell & Rosenfeld v Bithell, 254 Mich App 300, 327-328; 657 NW2d 759 (2002) (quotation marks and citation omitted). A contract will be implied ‘only if there is no express contract covering the same subject matter.’ Local Emergency Fin Assistance Loan Bd v Blackwell, 299 Mich App 727, 734; 832 NW2d 401 (2013) (quotation marks and citation omitted).
Defendant argues that the trial court erred when it allowed intervenors’ unjust-enrichment claim to proceed because there existed an express contract covering the same subject matter. We agree. Under its insurance contract with plaintiffs, defendant was required to pay for medical services provided as a result of injuries arising from a motor-vehicle accident. Thus, defendant’s obligation to pay for medical services provided to plaintiffs for injuries from a motor-vehicle accident arose solely from an express contract. In other words, if there was no insurance contract between plaintiffs and defendant, defendant would have no obligation at all with regard to plaintiffs. As a result, the trial court erred in concluding there was not an express contract related to the same subject matter.”
The Court of Appeals further held that, even if there was no applicable, express contract, the intervenor-plaintiffs’ still failed to state a cause of action for unjust enrichment. The Court noted that the elements of an unjust enrichment claim are: “ ‘(1) receipt of a benefit by the defendant from the plaintiff, and (2) which benefit it is inequitable that the defendant retain.’ ” In this case, the Court held that Tyler, not State Farm, received a benefit from the intervenor-plaintiffs. Thus, the intervenor-plaintiffs’ claim was merely a first-party action refashioned as a claim of unjust enrichment. Their only cognizable cause of action to recover reimbursement for the treatment they rendered to Tyler was through the no-fault act, and subject to the provisions of the no-fault act—e.g. the one-year-back rule. In other words, there is no “ ‘free-standing claim of unjust enrichment, independent of Michigan’s no-fault act’ ” that would allow providers such as the intervenor-plaintiffs to sidestep the no-fault act.
“ ‘The essential elements of [an unjust enrichment] claim are (1) receipt of a benefit by the defendant from the plaintiff, and (2) which benefit it is inequitable that the defendant retain.’ Meisner Law Group PC v Weston Downs Condo Ass’n, 321 Mich App 702, 721; 909 NW2d 890 (2017) (quotation marks and citation omitted; alteration in original). Intervenors failed to show defendant received a benefit from them. Intervenors treated plaintiffs for injuries sustained in the accident. Thus, plaintiffs were the parties that received a benefit—treatment of injuries—from intervenors, and not defendant. Intervenors claim defendant received a benefit by not paying for the services provided when Tyler’s claims were dismissed with prejudice. But, as defendant notes, the failure to remit payment relates to services rendered to plaintiffs for injuries, as defined in MCL 500.3105, and thus, the benefit defendant allegedly retained were payments for services provided to the insureds. Therefore, intervenors’ claim is one for no-fault benefits—regardless of how they labeled their claim. See Stephens v Worden Ins Agency, LLC, 307 Mich App 220, 228-229; 859 NW2d 723 (2014) (quotation marks and citation omitted) (‘It is well established under Michigan jurisprudence that a court is not bound by the label a party assigns to its claims. Rather, we must consider the gravamen of the suit based on a reading of the complaint as a whole.’). Such a claim is subject to the limitations of the no-fault act, not a claim for unjust enrichment. Additionally, it is well-settled that a medical provider has no independent statutory cause of action against a no-fault insurer for recovery of no-fault benefits. Covenant Med Ctr, Inc v State Farm Mut Auto Ins Co, 500 Mich 191, 218-219; 895 NW2d 490 (2017).3 Accordingly, the medical provider’s default remedy is to seek payment directly from the injured person. Id. at 217. As a result, the trial court should have granted defendant’s motion for summary disposition of intervenors’ claim for unjust enrichment.
Defendant also argues that the trial court erred when it recognized a ‘free-standing claim of unjust enrichment, independent of Michigan’s no-fault act,’ and that intervenors are attempting to sidestep the no-fault act. We agree.
Under MCL 500.3105(1), ‘an insurer is liable to pay benefits for accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle . . . .’ Under MCL 500.3107(1)(a), PIP benefits are payable for ‘[a]llowable expenses consisting of reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery, or rehabilitation.’ Thus, the no-fault act fully occupies the relationship between insurers, their insureds, and the providers who deliver medical services to those insureds. As noted, it is well-settled that, under the version of the no-fault act applicable to this case, a medical provider has no independent statutory cause of action against a no-fault insurer for recovery of no-fault benefits. See Covenant, 500 Mich at 218-219.
Intervenors’ claim for unjust enrichment seeks recovery of benefits that relate to care they provided plaintiffs after a motor-vehicle accident. Thus, as defendant notes, the damages intervenors seek are actually ‘requests for recovery by a medical provider for PIP benefits.’ In fact, in intervenors’ complaint, they allege that plaintiffs ‘sustained bodily injuries within the meaning of MCL 500.3105.’ Therefore, we agree with defendant that intervenors ‘are seeking recovery of what undoubtedly constitute[] no-fault benefits (because the services provided fall within MCL 500.3105, and generally within the no-fault act),’ and thus, intervenors’ claim necessarily arises out of the no-fault act. Although intervenors label their claim as one for unjust enrichment, this Court must look beyond the labels assigned by the parties and, considering ‘the gravamen of the suit based on a reading of the complaint as a whole,’ we conclude intervenors’ claim arises out of the no-fault act. See Stephens, 307 Mich App at 228-229. Accordingly, the trial court erred when it denied defendant’s motion for summary disposition of intervenors’ claim for unjust enrichment.”