MICHAEL F. SCHMIDT OBTAINS SUMMARY JUDGMENT IN U. S. DISTRICT COURT IN REGARD TO PLAINTIFFS’ MULTI-COUNT HANDICAP DISCRIMINATION CLAIM
Robert Benkovich and Kathy Benkovich v Washington Park Village Condominium Association, et al, U. S. District Court for the Eastern District of Michigan, the court granted summary judgment as to all claims made by the plaintiffs in a multi-count complaint alleging violation of the Fair Housing Amendment, malicious acts in violation of 42 USC §3617, violation of the condominium documents, violation of the Michigan Condominium Act, breach of fiduciary duty and violation of the Michigan Persons With Disabilities Act. The plaintiffs sought damages and injunctive relief to compel modifications to their condominium unit and a designated handicapped parking spot. The court agreed with all of our arguments on our motion for summary judgment that the plaintiffs failed to meet their burden of proof to demonstrate that the claimed accommodations were necessary, that there was different treatment for any other condominium resident, that there was any violation of the condominium documents or by-laws, that there was no breach of any fiduciary duty by any of the defendants and the plaintiffs were seeking privileges beyond those permitted to other co-owners.
MICHAEL F. SCHMIDT WINS SUMMARY JUDGMENT DEFEATING A CLAIM BY TRUSTEE IN BANKRUPTCY FOR INSURANCE COVERAGE FOR THE DEBTOR IN THE U. S. BANKRUPTCY COURT
In Re Romeo Montessori School Association, Inc., debtor, Stuart A. Gold, Trustee, plaintiff v Consolidated Insurance Company, defendant, U. S. Bankruptcy Court for the Eastern District of Michigan Southern Division. The plaintiff in this adversary proceeding is the Chapter 7 Bankruptcy Trustee who filed the proceeding seeking a declaratory judgment that Consolidated Insurance Company was required to provide coverage to the debtor for certain claims asserted against the Chapter 7 debtor, Romeo Montessori School Association. We represented Consolidated Insurance Company and after discovery filed a motion for summary judgment on the basis that coverage was excluded by the contractual liability exclusion contained in the policy. The underlying claims were claims by parents of students who had prepaid tuition in excess of $175,000 and filed proofs of claim when Romeo Montessori School filed a voluntary petition for bankruptcy and failed to provide the educational services contracted for the 2009-2010 school year. The Trustee argued first that Consolidated had waived the contractual liability exclusion by failing to raise it in its initial denial letter. We argued that coverage could not be created by waiver and estoppel, that none of the limited exceptions to this rule applied, and that the contractual liability exclusion had been raised in the answer and affirmative defenses filed over a year ago. The court agreed with our argument. The Trustee argued next that the claims were not articulated as claims for breach of contract. The court agreed with our argument in reviewing each of the 48 claims that each of the claims was based on a breach of contract although not described specifically as a breach of contract claim. The Trustee argued next that there were possible other theories of recovery such as conversion, breach of fiduciary duty or a quasi contractual theory such as unjust enrichment. The court agreed with our argument that the substance of the claims was breach of contract which was excluded by the policy, that there was no proof of any other theory of liability and that if an exclusion applies coverage is lost. The court granted summary judgment finding that there was no issue of fact and that there was no coverage owed by Consolidated Insurance Company under the policy.
MICHAEL F. SCHMIDT OBTAINS AFFIRMATION FROM MICHIGAN COURT OF APPEALS OF SUMMARY DISPOSITION IN INSURANCE COVERAGE CASE
Kent Companies, Inc. v Wausau Insurance Companies, Michigan Court of Appeals docket number 292237 (2011). The plaintiff, Kent Companies, Inc., filed suit against Wausau Insurance Companies seeking coverage for damages charged to Kent by the general contractor, Rockford Pepper Construction Company, arising out of the construction of the J. W. Marriott Hotel in downtown Grand Rapids. The claim pertained to the installation of the east entrance to the hotel which included a driveway with brick pavers and snowmelt tubes installed. We obtained a summary disposition and the Court of Appeals affirmed that there was no coverage available for any of the claims. We argued that the claim for coverage for removal and replacement of the insured’s concrete and wire mesh was not covered because there was no ‘occurrence’ and no ‘property damage’. We argued that the claim for removal and replacement of the brick pavers was not covered because of the impaired property exclusion, since the pavers were not damaged and the only expenses were incurred in their removal and replacement. Finally, we argued that there was no coverage for the claim for the removal and replacement of the snowmelt tubes, because the insured was not charged anything for the snowmelt tubes. The Court of Appeals further rejected the insured’s argument that there was an issue of fact as to how the snowmelt tubes were damaged, because the only question was whether they were damaged through the insured’s work which was undisputed.
GARY L. STEC OBTAINED SUMMARY DISPOSITION IN FIVE CONSTRUCTION CASES UNDER FULTZ V. UNION-COMMERCE
Gary L. Stec of our Grand Rapids office has obtained summary disposition in five separate lawsuits under the Supreme Court’s decision in Fultz v. Union-Commerce Assoc., 470 Mich 460 (2004).
1. In The Estate of Gehl v. ABC Contractor, Allegan County Circuit Court, the Estate brought a wrongful death lawsuit against several defendants involved in the construction of the Douglas Elementary School. The Estate argued that our client negligently performed work on the project that led to the death a steel erector. We filed a motion for summary disposition under MCR 2.116(C)(8) and argued that the Estate’s complaint did not state a valid cause of action against our clients since there was no separate and distinct duty owed to the decedent under Fultz, and that no exception existed that would allow the Estate to recover against our client. The trial court agreed, but allowed the Estate leave to amend its complaint. The amended complaint added counts of Third-Party Beneficiary and Nuisance in Fact. We renewed our motion under MCR 2.116(C)(8) and (10), and in a twenty-seven page decision issued on December 21, 2010, the trial court dismissed the Estate’s entire complaint, agreeing that our client did not owe the decedent a “separate and distinct duty” from its contract with the General Contractor. The court also agreed that the decedent was not an intended third-party beneficiary under our client’s contract and that the law of nuisance did not apply to the facts of the case. (The Estate’s pre-suit settlement demand was $8,100,000.00.)
2. In Cunningham v. Peters Construction, Kalamazoo County Circuit Court, the plaintiff brought suit against multiple contractors performing road and sidewalk improvements under contract with the City of Portage, alleging negligence, third-party beneficiary and nuisance, for injuries sustained when he rode his bicycle into an area of excavated sidewalk, sustaining fractures to his hand and injury to his knee. On January 10, 2011, the trial court granted summary disposition on all of the plaintiff’s counts, agreeing that no separate and distinct duty was owed by our client to the plaintiff, that the plaintiff was not a specifically intended beneficiary of the safety provisions of our client’s contract, and that the work being performed was not a nuisance.
3. In Hartwig v. Thornapple Excavating, Montcalm County Circuit Court, the plaintiff brought suit against a general contractor and our client on a hotel construction project, for injuries he sustained when he overturned a forklift on the construction site, sustaining severe crush injuries to his lower extremities. The trial court granted summary disposition under Fultz, agreeing that all of the work being performed by our client on the project was in furtherance of its contractual duties to the general contractor, and that no separate and distinct duty was owed to the plaintiff.
4. In State Farm v. Bartholomew Heating & Cooling, Kalamazoo County Circuit Court, a homeowners insurance carrier brought a subrogation lawsuit against contractors performing work on an addition to its insured’s residence, after a fire completely destroyed their home. The renovation project included installation of a gas fireplace, which State Farm alleged was a direct cause of the fire. The court granted summary disposition for our client under Fultz, agreeing that there existed no separate and distinct duty owed to the homeowner or State Farm, outside of our client’s contract with the general contractor.
5. In Osterman v. IMM, Inc., Oceana County Circuit Court, the plaintiff, an employee of Kurdziel Iron, fell through an opening in a platform adjacent to a cupola in the Kurdziel foundry in Rothbury, Michigan, suffering permanent brain and vision injuries. Suit was brought against our client who was hired to perform work on the cupola, including replacement of the adjoining decking. The trial court granted summary disposition under Fultz, agreeing that our client did not owe the plaintiff a separate and distinct duty outside of its contract with Kurdziel, that the plaintiff was not a third-party beneficiary of that contract, and that the work being performed did not create a nuisance.
SUPREME COURT DENIES APPLICATION FOR LEAVE TO APPEAL OF SUMMARY DISPOSITION OBTAINED BY MICHAEL F. SCHMIDT IN MULTI-VEHICLE AUTO ACCIDENT CASE
David W. Allard, as Trustee of the Bankruptcy Estate of Laura J. Wilamowski v Joseph A. Sova, Clarkston Steel, Inc., State Farm Mutual Automobile Insurance Company, Conrad C. Wilamowski and Mirash Bojaj, Supreme Court Docket Number 141844 and 141862, the Supreme Court denied the plaintiffs’ Application for Leave to Appeal from the Court of Appeals affirmation of summary disposition we obtained in the trial court for defendants Joseph Sova and Clarkston Steel. The plaintiff brought suit against multiple defendants alleging injuries incurred in a multiple-vehicle auto accident. The plaintiff claimed that she had a lumbar laminectomy and total and permanent disability from prior cervical fusions as a result of the accident. The plaintiff claimed that Sova was negligent by failing to stop his truck and having to go on the shoulder to avoid a rearend accident. We argued that defendants, Sova and Clarkston Steel, had no liability and that Sova’s truck was knocked into the median by another vehicle. We further argued that there was no basis to argue that any actions of Sova could have proximately caused any injury to the plaintiff. The plaintiff was an occupant in a vehicle on the opposite side of M-59 which allegedly had to change lanes to avoid a potential accident with the Sova truck, which the plaintiff claimed was coming toward the plaintiff’s lane. The trial court granted summary disposition holding that there was no negligence on the part of Sova and Clarkston Steel. The Court of Appeals affirmed summary disposition holding that the alleged evasive maneuver by the plaintiff’s vehicle was unremarkable and could not be proximately caused by the negligence of the defendants. The Supreme Court has now denied the Application for Leave to Appeal which ends this case.
SIXTH CIRCUIT COURT OF APPEALS AFFIRMS DISMISSAL OF TWO CONSOLIDATED CASES FOR WILLFUL FAILURE TO COOPERATE IN DISCOVERY IN APPEAL HANDLED BY MICHAEL F. SCHMIDT
Tyrone Smith v Nationwide Mutual Fire Insurance Company, Sixth Circuit Court of Appeals, docket number 09-2201, involved an appeal by the plaintiff of the dismissal of the plaintiff’s two consolidated suits, the first for $189,000 in allegedly stolen jewelry and the second a claim for no fault benefits and collision damage to the plaintiff’s Corvette from an alleged auto accident. After several discovery motions and hearings, the U. S. District Court dismissed both of the plaintiff’s suits for failing to respond to discovery requests and failing to comply with the magistrate’s discovery orders. The plaintiff appealed to the Sixth Circuit Court of Appeals, which ruled in a written opinion following oral argument, that the district court properly dismissed both of the plaintiff’s cases and did not abuse its discretion because the plaintiff had exercised bad faith in failing to cooperate in discovery through a pattern of non-compliance, there had been prejudice to Nationwide by compromising Nationwide’s ability to prepare its defense and by the time and money spent in cataloging the deficiencies in the plaintiff’s discovery responses and filing and arguing three discovery related motions, the magistrate had given an express warning in the second written opinion that if the plaintiff did not fulfill the discovery obligations the court would consider dismissing the plaintiff’s case with prejudice and the plaintiff’s failure to pay a $1,000 sanction imposed by the magistrate. As a result, both of the plaintiff’s lawsuits have been dismissed with prejudice.
MACOMB COUNTY CIRCUIT COURT GRANTS DECLARATORY JUDGMENT FINDING NO AUTOMOBILE LIABILITY COVERAGE IN CASE HANDLED BY MICHAEL F. SCHMIDT
MIC General Insurance Company v Michael Baumeister, Gary Rivard, Emilia Braden and Enterprise Leasing Company of Detroit, Macomb County Circuit Court, we filed a declaratory action on behalf of MIC General Insurance Company to obtain a ruling that MIC had no duty to defend or provide coverage to Gary Rivard, MIC’s insured’s grandson, for his use of a motor vehicle rented by his grandmother. The basis of the argument was that both the insured and Rivard testified that Rivard took the vehicle’s keys without permission, thus there was no permissive use and Rivard could not be an insured as required by the policy definition as a person using an insured vehicle with permission. We further argued that since Rivard’s license had been suspended for a number of years before the accident, he could not have a reasonable belief that he could use the vehicle and thus coverage was excluded by the exclusion for using a vehicle without a reasonable belief that the insured was entitled to do so. The trial court granted the motion in a twelve-page written opinion and rejected the underlying plaintiff Baumeister’s arguments that there was an issue of fact as to permissive use and that as an innocent third party the coverage defenses would not apply to him.
SUMMARY DISPOSITION OBTAINED BY MICHAEL F. SCHMIDT ENFORCING INSURERS’ RESCISSION OF AN AUTO INSURANCE POLICY FOR MATERIAL MISREPRESENTATION IN THE APPLICATION
Ardith McCormick v Nationwide Mutual Fire Insurance Company, Oakland County Circuit Court.
Plaintiff brought suit to recover for the theft of her motor vehicle. Nationwide had denied the claim on the basis that its investigation of the theft disclosed that the plaintiff had made several material misrepresentations in the application for the policy, that she failed to disclose two household members who were also drivers. We filed a motion for summary disposition supported by an underwriter’s affidavit that the application contained several material misrepresentations, that had the insurer known the true facts it would not have issued the policy as to the one misrepresentation, and would have charged a higher premium as to the other and thus the policy was appropriately rescinded. The plaintiff argued that the misrepresentations were not material because neither of the household members who were not disclosed were using the vehicle at the time of the loss. We argued in a reply brief that the Michigan appellate cases had rejected this exact argument in numerous cases and that rescission does not depend on the cause of the injury, rather the misrepresentation must be viewed as it relates only to the procurement of the policy of insurance. The trial court agreed with our argument and granted summary disposition to Nationwide that the policy had been appropriately rescinded and that the plaintiff had no claim under the policy.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION IN CLAIM FOR INSURANCE COVERAGE FOR PIZZA DELIVERY
Louis I. White, M.D. and Mary White, Individually and as Assignees of Uncle Andy’s Pizza, Inc., Andy Nannoshi and Mary Morse v Christopher Miller Agency, Inc., Christopher J. Miller, Rebecca Theriault and Nationwide Mutual Insurance Company, Oakland County Circuit Court.
Plaintiffs brought suit as assignees of Uncle Andy’s Pizza and its employees, Andy Nannoshi and Mary Morse, seeking recovery of a $2,000,000 judgment obtained in a claim for injuries allegedly incurred by the plaintiffs in a pizza delivery vehicle versus bicycle accident. After substantial discovery we filed a motion for summary disposition on behalf of the defendant, Nationwide Mutual Insurance Company, arguing that the Nationwide policy excluded automobile liability coverage, the policy contained an endorsement exclusion for food delivery and contained another endorsement exclusion limiting coverage to the designated premises. We further argued that the plaintiffs were judicially estopped from claiming coverage in the case, because they already sought and obtained their full uninsured motorist benefits from their own automobile liability insurer alleging in that claim that Uncle Andy’s Pizza, Inc. and its employees had no insurance. We further argued that any claim of any misrepresentation by the agents was barred by the application signed by Andy Nannoshi which stated that food delivery was not covered and further barred by Nannoshi’s failure to read the policy and raise any questions regarding coverage. After hearing oral argument, the trial court issued a written opinion granting summary disposition to Nationwide. Subsequently, the plaintiffs filed a motion for reconsideration which the trial court also denied by written opinion and order.
COURT OF APPEALS AFFIRMS SUMMARY DISPOSITION OBTAINED BY MICHAEL F. SCHMIDT IN MULTI-VEHICLE AUTO ACCIDENT CASE
David W. Allard, as Trustee of the Bankruptcy Estate of Laura J. Wilamowski v Joseph A. Sova, Clarkston Steel, Inc., State Farm Mutual Automobile Insurance Company, Conrad C. Wilamowski and Mirash Bojaj, Michigan Court of Appeals docket number 285633, the Court of Appeals affirmed summary disposition we obtained in the trial court for defendants Sova and Clarkston Steel. The plaintiff brought suit against multiple defendants alleging injuries incurred in a multi-vehicle accident. The plaintiff claimed that she had a lumbar laminectomy and total and permanent disability from prior cervical fusions as a result of the accident. The plaintiff claimed that Sova was negligent by failing to stop his truck and having to go on the shoulder to avoid a rearend accident. We argued that defendants, Sova and Clarkston Steel, had no liability and that Sova’s truck was knocked into the median by another vehicle. We further argued that there was no basis to argue that any actions of Sova could have proximately caused any injury to the plaintiff. The plaintiff was an occupant in a vehicle on the opposite side of M-59 which allegedly had to change lanes to avoid a potential accident with the Sova truck, which the plaintiff claimed was coming toward the plaintiff’s lane. The Court of Appeals affirmed summary disposition granted by the trial court holding that the alleged evasive maneuver by the plaintiff’s vehicle was unremarkable and could not be proximately caused by the negligence of the defendants.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION ENFORCING INSURANCE POLICY CONDITION REQUIRING PROTECTIVE SAFEGUARDS WHERE INSURED FAILED TO HAVE AN OPERATING FIRE ALARM SYSTEM
Stephanie Dunbar d/b/a Sassy But Classy Hair Salon v AMCO Insurance Company and Steve Paquette, Wayne County Circuit Court. Claim by plaintiff, Stephanie Dunbar d/b/a Sassy But Classy Hair Salon, for fire loss damage to her hair salon business. After discovery we prepared and filed a motion for summary disposition on behalf of the defendants arguing that the claim was barred by plaintiff’s failure to comply with the protective safeguards endorsement in the policy, which provided that in return for a decreased premium, the insured agreed as a condition of the policy that she would maintain an automatic fire alarm system protecting the premises. We determined through discovery that the insured had failed to obtain or maintain an automatic fire alarm system of any type including at the time of the fire. The case was dismissed in response to our motion for summary disposition.
MICHIGAN SUPREME COURT REVERSES KREINER V FISCHER REGARDING THE SERIOUS IMPAIRMENT THRESHOLD
The Michigan Supreme Court has issued its decision in McCormick v. Carrier, ____ Mich ____ (Docket Number 136738, 2010) which reverses Kreiner v. Fischer, 471 Mich 109, 683 NW2d 611 (2004) as wrongly decided.
The opinion is very lengthy and is a 4-3 decision with a lengthy dissent.
MCCORMICK’S CLAIM
McCormick had a truck drive over his left ankle. He was taken to the hospital, x-rays showed a fracture of his left medial malleolus. He was released from the hospital that day and two days later metal hardware was surgically inserted into his ankle to stabilize bone fragments. He was restricted from weight bearing for one month after surgery and then underwent multiple months of physical therapy. The metal hardware was removed in a second surgery ten months after the first. A defense IME 11 months after the accident indicated the plaintiff could return to work but was restricted from prolonged standing or walking. Twelve months after the accident, the specialist who performed the surgeries cleared the plaintiff to return to work without restrictions and noted that he had an excellent range of motion and solid healing.
McCormick then returned to work one year after the accident for several days but had difficulty walking, climbing and crouching because of ankle pain and asked for a restricted job but was directed to cease work. He was then required to undergo a functional capacity evaluation 14 months after the accident which determined that he was unable to perform the range of tasks his job required including stooping, crouching, climbing, sustained standing and heavy lifting due to ankle and shoulder pain, a moderate limp and difficulty bearing weight on the left ankle. Sixteen months after the accident a second defense IME was performed which indicated that the plaintiff complained of ankle and foot pain but there was no objective abnormality to correspond with the subjective complaints and he was thus able to return to work. An MRI 17 months after the accident showed some post-operative scar and degenerative tissue around the left ankle. Another functional capacity evaluation was performed 19 months after the accident which affirmed that the plaintiff could return to work without restriction and was capable of performing the tasks required for his job, although he complained of occasional aching and tightness in the ankle and his range of motion was still not within normal limits. He then returned to work 19 months after the accident to a different job with the same pay and was able to perform the new job since that time.
In his lawsuit McCormick testified that his normal life before the incident was working 60 hours per week as a medium-duty truck loader and a weekend golfer and frequently fishing in the spring and summer from a boat. He admitted he was fishing at his pre-incident levels by the spring and summer of the year after the accident but only golfed once since returning to work. He had not sought any medical treatment for his ankle since a year after the accident when he was approved to return to work without restriction. He testified that his life was “painful, but normal”, although it was “limited” and he continued to experience ankle pain.
The trial court granted summary disposition to the defendant finding no serious impairment. The Court of Appeals affirmed in a 2-1 decision. The Supreme Court reversed, holding that there was a serious impairment as a matter of law.
TEST OF LIABILITY
1. A QUESTION OF LAW OR FACT UNDER MCL 500.3135(2).
According to the statute, the threshold question whether a person suffered a serious impairment of body function should be determined by the court as a matter of law as long there is no factual dispute regarding the “nature and extent of the person’s injuries” that is material to determine whether the threshold standards are met. However, the court noted in a footnote that the Legislature may have unconstitutionally invaded the Court’s exclusive authority by imposing the requirement that the dispute is “material”. The court stated that this was not an issue in the current case but may be reached in a future case. The court further stated that a disputed fact does not need to be outcome determinative in order to be material, but it should be “significant or essential to the issue or matter at hand”.
2. A “SERIOUS IMPAIRMENT OF BODY FUNCTION”.
The court held that each of these prongs’ meaning is clear from the plain and unambiguous statutory language of MCL 500.3135(7) and judicial construction is neither required nor permitted, but that a “dictionary may aid the Court in giving the words and phrases… their common meaning…”
A. AN OBJECTIVELY MANIFESTED IMPAIRMENT
The court stated that the dictionary definitions suggest that the common meaning of “objectively manifested” is “an impairment that is evidenced by actual symptoms or conditions that someone other than the injured person would observe or perceive as impairing a body function. In other words, an “objectively manifested” impairment is commonly understood as one observable or perceivable from actual symptoms or conditions.”
The court further stated that the issue is whether the impairment is objectively manifested, not the injury or its symptoms. The court held that the focus must not be on the injuries themselves, but on how the injuries affect a particular body function. The court noted that the serious impairment threshold is not met by pain and suffering alone but also required injuries that affect the functioning of the body. The court further noted that the plaintiff must introduce evidence establishing that there is a physical basis for the subjective complaints of pain and suffering and that showing an impairment generally requires medical testimony. The court specifically rejected any requirement from Kreiner that there always must be medical documentation, only that medical testimony would generally be required.
The court’s summary of this issue states that there must be “an objectively manifested impairment (observable or perceivable from actual symptoms or conditions).”
B. OF AN IMPORTANT BODY FUNCTION
The court held that the relevant definition of “important” is whether a body function has great “value”, “significance”, or “consequence” which will vary depending on the person. Therefore, “this prong is an inherently subjective inquiry that must be decided on a case-by-case basis, because what may seem to be a trivial body function for most people may be subjectively important to some, depending on the relationship of that function to the person’s life.”
The court specifically disapproved of any construction that this is an objective test.
C. THAT AFFECTS THAT PERSON’S GENERAL ABILITY TO LEAD HIS OR HER NORMAL LIFE
The court held that the definitions of “general” illustrate “that to affect the person’s “general ability” to lead his or her normal life is to influence some of the person’s power or skill, i.e., the person’s capacity, to lead a normal life.” This requires a subjective, person and fact, specific inquiry that must be cited on a case-by-case basis, requiring a comparison of the person’s life before and after the incident.
The court noted there are several important points to note:
(1) The “statute merely requires that a person’s general ability to lead his or her normal life has been affected, not destroyed.” The court should consider not only whether the impairment has led the person to completely cease a pre-incident activity or lifestyle element, but also whether, although a person is able to lead his or her pre-incident normal life, the person’s general ability to do so was nonetheless affected.
(2) The word “general” modifies “ability” not “affect” or “normal life”. Thus, the plain language of the statute only requires that some of the person’s ability to live in his or her normal manner of living has been affected, not that some of the person’s normal manner of living has itself been affected. “There is no quantitative minimum as to the percentage of a person’s normal manner of living that must be affected.”
(3) “The statute does not create an express temporal requirement as to how long an impairment must last in order to have an effect on “the person’s general ability to lead his or her normal life”.” The court specifically rejected any argument from Kreiner that the court should focus on how much the impairment affects a person’s life instead of how much it affects the person’s ability to live his or her life. Further, there should be no implied sense of permanence. The court specifically rejected the Kreiner analysis of the (a) nature and extent of the impairment, (b) the type and length of treatment required, (c) the duration of the impairment, (d) the extent of any residual impairment and (e) the prognosis for potential recovery.
The court’s summary of this factor states that the test is the affect on the person’s general ability to lead his or her normal life (influences some of the plaintiff’s capacity to live in his or her normal manner of living).
APPLICATION TO THE MCCORMICK CASE
The court held that the serious impairment analysis is inherently fact-and-circumstance-specific and must be conducted on a case-by-case basis. The analysis does not lend itself to any bright-line rule or imposition of a list of factors.
As applied in McCormick, the parties did not dispute that McCormick suffered a broken ankle, was completely restricted from weight bearing on his ankle for a month, and underwent two surgeries in a ten month period and multiple months of physical therapy.
There was a dispute as to whether there was a physical basis for his continuing subjective complaints of pain and suffering.
However, the court held that this was not significant or essential to determine whether the serious impairment threshold was met, because the plaintiff did not allege that the residual impairment, to the extent it exists, continues to affect his generally ability to lead his pre-incident normal life.
The court further determined that before the incident McCormick’s normal life consisted of working 60 hours a week as a medium truck loader and frequently fishing in the spring and summer and a weekend golfer. After the incident he was unable to work for at least 14 months and did not return for 19 months and never returned to his original job. He was able to fish at pre-incident level by about 14 months after the accident.
The court determined:
A. AN OBJECTIVELY MANIFESTED IMPAIRMENT
McCormick has shown an objectively manifested impairment of body function. There is no dispute that he suffered a broken ankle and actual symptoms or conditions that someone else would perceive as impairing body functions, with his walking, crouching, climbing and lifting weight.
B. OF AN IMPORTANT BODY FUNCTION
McCormick has shown that the impaired body functions were important to him since he established that he was unable to walk and perform other functions which were of a consequence to his ability to work.
C. THAT AFFECTED THE PERSON’S GENERAL ABILITY TO LEAD HIS OR HER NORMAL LIFE
McCormick has shown that the impairment affected his general ability to lead his normal life because it influenced some of his capacity to live in his normal pre-incident manner of living which consisted of working 60 hours a week and his hobbies of fishing and golfing. At least some of his capacity to live in this manner was affected. Specifically, for a month after the incident he could not bear weight on his left ankle. He underwent two surgeries over a period of ten months and multiple months of physical therapy. His capacity to work, an essential part of his pre-incident normal life, was affected. He was unable to perform functions necessary for his job for at least 14 months and did not return to work for 19 months.
The court concluded that all three prongs were met as a matter of law that plaintiff suffered a serious impairment.
SUMMARY
As can be seen, McCormick should have a substantial affect on third party auto cases regarding the threshold.
The Kreiner factors are now out.
The emphasis is on a subjective case-by-case analysis.
The most important issue is in regard to the removal of any temporal element and that there must be an affect on the plaintiff’s entire life. There only has to be an influence on some of the plaintiff’s capacity to live in his or her normal, pre-incident manner of living.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION IN THIRD PARTY AUTO CASE BASED ON NO SERIOUS IMPAIRMENT
Richardson v Rosario, Oakland County Circuit Court, claim for multiple injuries from a T-bone intersection accident. Plaintiff claimed injuries to her left ankle/Achilles tendon, left knee, low back and neck. Plaintiff had multiple different treaters for these multiple alleged injuries for ten months after the accident. We filed a motion for summary disposition arguing that there was no serious impairment of an important body function. The court granted our motion issuing a twelve page Opinion finding that the functions of the back and the ability to walk were important body functions, and that the plaintiff had objective impairments by a bulging disc confirmed by MRI and bursitis in her knee, but that based on a review of the records and the plaintiff’s deposition testimony the plaintiff’s general ability to lead her normal life, or the course or trajectory of her normal life, had not been affected by the injuries she allegedly sustained and thus granted our motion for summary disposition.
SUMMARY JUDGMENT IN PRODUCT LIABILITY FIRE LOSS CASE OBTAINED BY MICHAEL F. SCHMIDT
Auto Club Group Insurance Company as Subrogee of Andrea and John Nelson v Auto-Glass Aquarium Company, Inc., U. S. District Court for the Eastern District of Michigan Southern Division.
Subrogation claim by the plaintiff, Auto Club Group Insurance Company as Subrogee of Andrea and John Nelson for fire damage to the Nelsons’ house and personal property claimed to be in excess of $235,000. The product liability action was filed against All-Glass Aquarium Company, Inc. alleging that the fire was caused by the failure of a switch in an aquarium hood/light manufactured by All-Glass. We deposed the plaintiffs’ experts and retained our own expert. Based upon the testimony the plaintiffs’ experts and our expert we filed a motion for summary judgment arguing that the product liability claim must fail because there was no proof or evidence beyond speculation and conjecture that the fire was caused by the aquarium hood light. The plaintiffs’ expert claimed that the fire started in the switch and that the switch was entirely consumed in the fire. We showed through the testimony of our expert that the switch was not entirely consumed in the fire, that there was no evidence of any arcing or electrical activity on the remains of the switch, and that there were other potential causes of the fire which had not been eliminated. The trial court issued a lengthy written opinion holding that the plaintiffs’ experts’ opinions did not rise above the speculative level and were insufficient to support the plaintiffs’ claim, that the plaintiffs’ expert could not identify a specific manufacturing defect in the product, had no evidence to support his carbon-tracking theory and did not compare the product at issue to defendant’s own manufacturing standards. Regarding the negligence claim, the court held that the plaintiff did not differentiate the negligence claim from the implied warranty claim which was also thus insufficient. The trial court thus granted summary judgment and dismissed all claims by the plaintiffs against All-Glass Aquarium Company, Inc.
CLAIM FOR INSURANCE COVERAGE UNDER COMMERCIAL GENERAL LIABILITY POLICY FOR DAMAGES INCURRED BY CONTRACTOR IN THE COURSE OF CONSTRUCTION PROJECT DEFEATED BY MICHAEL F. SCHMIDT WHO OBTAINED SUMMARY DISPOSITION FROM THE TRIAL COURT
Kent Companies, Inc. v Wausau Insurance Companies, Kent County Circuit Court. Claim by the insured, Kent Companies, Inc., for recovery of alleged damages charged to Kent by the general contractor, Rockford Pepper Construction Company, arising out of the J. W. Marriott Hotel Project in downtown Grand Rapids. After discovery we filed a motion for summary disposition arguing that there was no coverage for any of the claims under the commercial general liability policy issued by Wausau because there was no “occurrence”, no “property damage”, and that exclusions (k) for your product, exclusion (l) for your work, exclusion (m) for impaired property and exclusion (n) for recall and replacement all applied to exclude coverage. Kent filed a cross-motion for summary disposition arguing that coverage applied and that none of the exclusions applied. After substantial briefing by both parties, the court heard oral argument and granted summary disposition in favor of Wausau that there was no coverage. Kent then filed a rehearing which was also denied.
MICHAEL F. SCHMIDT OBTAINS DISMISSAL OF CLAIM FOR FIRE DAMAGE AND LOSS OF INCOME IN EXCESS OF $500,000
Abdallah Gas & Mini Mart, Inc. v AMCO Insurance Company, Saginaw County Circuit Court, suit for fire damage and loss of income in excess of $500,000 from an alleged fire. After substantial investigation and discovery including cooperation with the U. S. Secret Service and federal agents regarding a Small Business Administration loan scam, we filed a motion to dismiss which was granted dismissing the case with prejudice.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION IN WRONGFUL DEATH CONSTRUCTION ACCIDENT CLAIM AGAINST GENERAL CONTRACTOR
Amy Felty, Personal Representative of the Estate of Leo Felty, Jr., Deceased v Skanska USA Building, Inc., Washtenaw County Circuit Court, claim for the wrongful death of Leo Felty, Jr. who fell about 30 feet from a hydromobile scaffold while working on the University of Michigan Alumni Memorial Hall Museum of Art Renovation Project for Davenport Masonry, Inc. Suit was filed against Skanska USA Building, Inc., the general contractor for the project, who we defended. There had been multiple MIOSHA violations issued against Davenport Masonry, Inc., the employer of the decedent for the accident. After substantial discovery we filed a motion for summary disposition on behalf of Skanska arguing that the plaintiff failed to establish liability of the general contractor and that none of the elements of the common work area exception applied. We argued that there was no evidence that Skanska failed to take reasonable steps within its supervisory and coordinating authority, that there was no evidence of a readily observable and avoidable danger, because the hydromobile scaffold had been fully guarded at all times on the project other than on part of the day of the accident when it was elevated over 30 feet in the air and covered with visqueen and the lack of guarding could not be observed, that there was no evidence of a high degree of risk to a significant number of workers, because the only workers exposed to the hazard were the decedent and his co-worker, and that there was no evidence of a common work area, because the only subcontractor who was exposed to the hazard were employees of Davenport. The trial court agreed with our arguments and granted summary disposition dismissing any and all claims made by the plaintiff against Skanska USA Building, Inc.
DECLARATORY JUDGMENT OBTAINED BY MICHAEL F. SCHMIDT AND ALSO SUMMARY DISPOSITION AS TO THE INSUREDS’ COUNTERCLAIM FOR BAD FAITH AND BREACH OF CONTRACT ARISING OUT OF CLAIM FOR INSURANCE COVERAGE FOR AN UNDERLYING CLAIM RESULTING FROM A FAILED MERGER OF INSURANCE AGENCIES
AMCO Insurance Company v Douglas Williams and Douglas Williams & Associates, Inc., Washtenaw County Circuit Court, declaratory action which we filed on behalf of AMCO Insurance Company to obtain a ruling that AMCO Insurance Company had no duty to defend and provide coverage to Douglas Williams and Douglas Williams & Associates, Inc. for claims made against them in an underlying action resulting from a failed merger of several insurance agencies, and we also defended AMCO against a counterclaim by Douglas Williams and Douglas Williams & Associates, Inc. for breach of contract and bad faith. After discovery, we filed a motion for summary disposition arguing that there was no coverage for the claims made in the underlying action because the allegations in the underlying complaint were incorrect as to when the events occurred and the events actually occurred outside the policy period, that coverage was barred by failure to comply with the policy conditions requiring notice of the underlying suit, the voluntary payment clause and the no action clause, by settling the underlying claim without notice to the insurer, that there was no “personal and advertising injury” as defined by the policy alleged in the underlying action and that coverage was excluded by policy exclusions for acts done with the knowledge that the act would violate the rights of another, for publication of material with knowledge of its falsity, for breach of contract and for violation of laws. The trial court granted our summary disposition in favor of AMCO on all grounds, that there was no duty to defend or provide coverage because all of the events alleged in the underlying action occurred after the policy was cancelled, that the insured’s reliance on dates in the underlying complaint was improper since the underlying information established that these dates were incorrect, and that even if the policy was not cancelled, coverage was barred by breach of the notice condition, the cooperation condition, the voluntary payment condition and the no action clause, and that in addition, all of the exclusions applied. The court also granted our summary disposition for AMCO as to any and all claims made by Douglas Williams and Douglas Williams & Associates, Inc. in the counterclaim for bad faith and breach of contract. The insureds sought reimbursement of over $100,000 in indemnity plus attorney fees in excess of $50,000.
MICHAEL F. SCHMIDT OBTAINS DISMISSAL OF TWO INSURANCE CLAIM SUITS DUE TO PLAINTIFF/INSURED’S FAILURE TO COMPLY WITH DISCOVERY ORDERS
Tyrone Smith v Nationwide Mutual Fire Insurance Company, U. S. District Court for the Eastern District of Michigan, two different lawsuits filed by Tyrone Smith, the first for $189,000 in allegedly stolen jewelry and the second a claim for no fault benefits from an auto accident plus collision damage for the plaintiff’s Corvette. After several discovery motions and hearings in which the federal magistrate ordered the plaintiff to respond to discovery requests, we filed a motion to dismiss for the plaintiff’s failure to comply with the court’s discovery orders, which was granted and both cases were dismissed with prejudice.
MICHIGAN COURT OF APPEALS AFFIRMS SUMMARY DISPOSITION ENFORCING AUTO LIABILITY NOTICE CLAUSE IN APPEAL HANDLED BY MICHAEL F. SCHMIDT
Integon National Insurance Company v Vincent Lecari Berry and Patricia Carol Berry, Michigan Court of Appeals docket number 289320 (2009), appeal by the underlying plaintiff Coze Elissa Long and by the uninsured motorist carrier, Bristol West Insurance Company, of summary disposition granted by the trial court to Integon National Insurance Company. Integon’s insureds were involved in an auto accident but failed to provide notice to Integon of the auto accident, the fact that they were served with a suit, that the fact that the suit was filed or that they had been defaulted.
When Integon received notice from the uninsured motorist carrier after the entry of the default it hired defense counsel to represent the insureds in the underlying action who filed a motion to set aside the default, which the trial court denied. We then filed a declaratory judgment action to have the court rule that since the insureds had failed to provide Integon with notice of the accident and the suit there had been a violation of the notice condition of the policy and pursuant to the Michigan Financial Responsibility Act, MCL 257.520(f)(6), Integon did not owe coverage or a defense. The trial court agreed and granted summary disposition to Integon that it had no duty to defend or provide coverage including it had no duty to even provide the minimum Financial Responsibility limits of $20,000/$40,000 to the innocent third party who had been involved in the accident. The underlying plaintiff and Bristol West, the uninsured motorist carrier, appealed to the Court of Appeals. The Court of Appeals has now issued its decision affirming the summary disposition we obtained for Integon and rejecting all of the arguments raised by the underlying plaintiff and Bristol West.
This is an important decision, because the Court of Appeals held that per MCL 257.520(f) of the Michigan Financial Responsibility Act, an insurer has no duty to provide coverage if the insured has failed to provide notice of the accident and suit and the insurer has been prejudiced. Further, that the issue of prejudice is an issue of fact, but where the insured has been defaulted and the insurer has no ability to contest liability, prejudice is established. The court further held that MCL 257.520(f)(6) relieves the insurer of any liability, not just of liability over the minimum required limits of $20,000/$40,000 and that there is no conflict with the provisions of the No Fault Law. The court further held that in determining the applicable uninsured motorist coverage, such coverage applies per the terms of the policy if there is not a liability policy which was applicable at the time of the accident. Applicable at the time of the accident does not mean that there is an insurance policy in existence, rather there is an insurance policy that actually provides protection for the accident. The Integon policy was in existence, but it did not provide protection because of the violation of the notice condition and MCL 257.520(f)(6), the vehicle was uninsured and thus the uninsured motorist coverage applied.
Jury Returns a Verdict for $138,915 and Costs and Attorney Fees of $26,162 Awarded in Business Dispute and Breach of Settlement Agreement Case Tried by Dale Burmeister
This case arose out of a dispute between the owners of a mailing company. Plaintiff owned 51% of the company and claimed that the equipment, customers, and the name of the entity were misappropriated by the Vice President while Plaintiff was recovering from cancer.
Prior to filing suit, the parties tried to resolve the case with the help of a former Judge. A settlement of $130,000, payable over four years in monthly installments, was reached, but Plaintiff claimed that Defendant reneged on the deal and filed suit for conversion, fraud and misrepresentation, tortuous interference with business relations, breach of fiduciary duty, and breach of the settlement agreement. On the morning of trial, the Court bifurcated the settlement agreement count from the other claims and proceeded to trial. Following a five day trial, the jury returned a verdict of $138,915 and the Court subsequently awards costs and attorney fees of $26,162.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION ENFORCING EXCLUDED DRIVER ENDORSEMENT
Nationwide Mutual Insurance Company v Robert Troup, et al, Oakland County Circuit Court, declaratory action, which we filed on behalf of Nationwide Mutual Fire Insurance Company to obtain a ruling that Nationwide had no duty to defend or provide coverage to its insureds for a claim arising out of an auto accident in Florida, in which the insureds’ vehicle was being operated by their son, who was a named excluded driver on the Nationwide policy. The insureds argued that they were not aware that their son was a named excluded driver and did not authorize Nationwide to exclude him as a driver. We argued that the insureds had received five dec pages and five sets of certificate of insurance naming their son as a named excluded driver in compliance with MCL 500.3009(2), that they were bound by the terms and conditions of their insurance policy whether they read it or not, and that authorization to exclude their son as a driver does not require a signature by the insured, but may be shown by notice such as receiving the dec pages and the certificates of insurance indicating that their son was a named excluded driver. The court granted summary disposition agreeing with our arguments, that Nationwide had no duty to defend or provide coverage to the insureds for the claim arising out of their son’s operation of their vehicle in Florida.
BARRY SUTTON AND JOHN PREW WIN 5 MINUTE DEFENSE VERDICT IN TREESTAND CASE
A jury in Chester County Pennsylvania recently took only five minutes to conclude that treestand was not defective in a product liability, serious injury case involving one of Harvey Kruse’s many national product liability clients. The plaintiff, who had fallen approximately 15 feet from his treestand argued that damage to the treestand platform was the cause of his fall. The defense argued that the physical damage was the result of the fall and not the cause of the fall, and submitted that the incident did not occur as the plaintiff claimed. The victory is the latest in a long line of favorable results for the Harvey Kruse national product liability team.
SIXTH CIRCUIT COURT OF APPEALS AFFIRMS SUMMARY JUDGMENT OBTAINED BY MICHAEL F. SCHMIDT IN INSURANCE POLICY RESCISSION CASE.
Mohammed Huda v Integon National Insurance Company, No. 08-2193(6th Cir, 2009), appeal from summary judgment granted by U. S. District Court Eastern District of Michigan in favor of Integon National Insurance Company that it properly rescinded an automobile insurance policy based on a material misrepresentation made by the insured in the application, by failing to disclose all household members who were of driving age including his son, Mohammed Huda, Jr. The plaintiff sustained catastrophic injuries including loss of his right eye in an auto accident. The Sixth Circuit agreed with our argument that under Michigan law an insurer can void a policy when there has been a material misrepresentation in the application. The insured claimed that he was not asked about other drivers in the household and did not fill out the page requesting this information. However, we argued that he signed the Applicant’s Certification which indicated that he had answered all of the questions in the application and that all persons of eligible driving age or permit age who lived with him as well as resided in his household had been shown in the policy. The court also rejected the plaintiff’s argument that Integon should be estopped and held to have waived the rescission by failing to assure that Huda had filled out the entire application including the Undisclosed Driver section. The court agreed with our argument that waiver and estoppel cannot be established by mere silence and that the plaintiff’s argument was contrary to the Applicant’s Certification. The court further rejected Huda’s argument that the misrepresentation could have been “ascertained easily” since Huda had disclosed a prior homeowner policy which also listed his wife as a household member. The court agreed with our argument that this did not establish any knowledge of Huda, Jr. and that the argument was based on Huda’s claim that failure to inform Integon about one driver in his household could be excused by his failure to inform Integon about another driver. The court also rejected Huda’s argument that the application was ambiguous.
MICHAEL F. SCHMIDT OBTAINS DISMISSAL OF CLAIM FOR UNDERINSURED MOTORIST BENEFITS BASED ON FORUM NON CONVENIENS.
James Lauder v GMAC Insurance, Oakland County Circuit Court, claim by James Lauder for underinsured motorist benefits. We successfully obtained a dismissal based on forum non conveniens of the claim for underinsured motorists benefits. We argued that all of the contacts in the case were with Texas. The plaintiff was a Texas resident when he was involved in an auto accident in Texas involving another Texas resident. His auto liability policy including underinsured motorist benefits was issued by Home State County Mutual Insurance Company, a Texas insurer, which operates only in Texas. Following the accident, the plaintiff treated for several years in Texas. He then moved to Michigan and began treating with a doctor in Michigan about two years after the accident. The court agreed that all of the contacts were with Texas other than the plaintiff moving to Michigan two years after the accident and after filing his claim for underinsured motorist benefits. The court dismissed the case based on forum non conveniens.
MICHAEL F. SCHMIDT DEFEATS CLAIM BY MUNICIPALITY FOR PROPERTY DAMAGE AGAINST VEHICLE OPERATOR
City of Fenton v Robert William Gaffney, Jr., Genesee County District Court 67-4A, claim by the City of Fenton pursuant to a City of Fenton ordinance to collect expenses for environmental clean up following an auto accident. We represented the defendant motor vehicle operator and argued that the claim was improper, because any claim for property damage arising out of a motor vehicle accident was properly made pursuant to the No Fault Law against the motor vehicle owner’s no fault insurer pursuant to MCL 500.3121. The trial court agreed and granted summary disposition holding that the city had improperly sued the motor vehicle operator and not the insurer.
SUMMARY DISPOSITION MOTION FILED BY MICHAEL F. SCHMIDT GRANTED IN CONSOLIDATED CASES BY INSURER AND HOMEOWNER FOR 4.2 MILLION DOLLAR FIRE LOSS
Auto-Owners Insurance Company as Subrogee of William Larkin and Mary Larkin v Kellett Construction Company, Albaugh Masonry Stone and Tile, Inc. and Butcher & Baecker Construction Company and William Larkin and Mary Larkin v Kellett Construction Company, Albaugh Masonry Stone and Tile, Inc. and Butcher & Baecker Construction Company, Oakland County Circuit Court, claim for fire loss to home and contents owned by William Larkin and Mary Larkin insured by Auto-Owners. Auto-Owners claimed damages to the home and contents in the amount of $3,093,117. The Larkins claimed an additional uninsured loss of $1,117,000. We represented Albaugh Masonry Stone and Tile, Inc. a subcontractor on the project who was alleged to have negligently hired a sub-subcontractor, Butcher & Baecker Construction Company, failed to supervise and inspect the work of Butcher & Baecker and failed to provide proper fire protection for the work. We were successful in obtaining a summary disposition in favor of Albaugh Masonry Stone and Tile, Inc. as to any and all claims made against it on the basis that the plaintiffs had no claim against Albaugh for negligent hiring, no claim for common work area or inherently dangerous activities liability, there was no evidence that Albaugh contracted to assume any duties to supervise or inspect the work of Butcher & Baecker, there was no independent negligence by Albaugh, there was no claim for breach of warranty, no third party beneficiary claim and no viable theory of liability. Additionally, the court granted summary disposition in favor of Albaugh as to the crossclaim filed by Kellett Construction Company finding that Kellett had no claim for breach of warranty or indemnity against Albaugh.
DALE BURMEISTER AND JASON MATHERS WIN SOPHISTICATED USER DECISION IN LIVING MESOTHELIOMA CASE
In Krafft v Allied Glove et al., Dale Burmeister and Jason Mathers moved for summary disposition in a living mesothelioma case based on a statute inMICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION TO ENFORCE HOUSEHOLD EXCLUSION IN AN AUTOMOBILE LIABILITY POLICY.
Randy Robert Begin, as Conservator of The Estate of Lily Begin, a Minor and Madison Begin, a Minor v Nationwide Mutual Fire Insurance Company, Wayne County Circuit, claim by the plaintiffs to seek automobile liability coverage for a claim against their deceased mother as a result of an auto accident, pursuant to the automobile liability policy issued by Nationwide Mutual Fire Insurance Company to Tony Martinez, who had married the minor children’s mother. We argued on behalf of Nationwide that any coverage for any claim by the minors against their mother arising out of the automobile accident would be limited by the household exclusion with the drop down clause appearing in the Nationwide policy to the Michigan Financial Responsibility limits of $20,000/$40,000. The plaintiffs argued that the exclusion was ambiguous and unenforceable. We successfully argued that the exclusion was not ambiguous, and was valid and enforceable and the court granted summary disposition in favor of Nationwide limiting coverage to $20,000/$40,000.
MICHAEL F. SCHMIDT OBTAINS SUMMARY DISPOSITION IN CONSTRUCTION ACCIDENT CASE
Cummings v S. E. Spohn Construction Company v American Erectors, Inc., Genesee County Circuit Court, claim by Sean Cummings that he sustained injuries when a beam was allegedly knocked onto and crushed his feet while working as an employee for American Erectors on a construction project. The plaintiff received substantial workers’ comp benefits and eventually redeemed his workers’ comp claim for $150,000. We filed a joint motion for summary disposition with Spohn in support of Spohn as to the primary plaintiff’s claim, arguing that the plaintiff had no claim for negligent hiring of a contractor, or for inherently dangerous activities, and also failed to meet the four part test for common work liability. The plaintiff argued that employees of Spohn were working in the area and also crossed through the American Erectors’ work area on their way to work and thus there was a common work area. We argued that there were not a significant number of workers exposed to the hazard, since there were only seven members of the American Erectors’ crew and only three were working on the ground in the area of the accident, and that there was no common work area because there were no other trades working in the area. The trial court agreed and granted summary disposition in favor of Spohn as to any and all claims made by the plaintiff.
MICHAEL F. SCHMIDT PURSUADES THE MICHIGAN COURT OF APPEALS TO AFFIRM ARBITRATORS’ REJECTION OF COVERAGE AND DEFENSE COSTS ARISING OUT OF A $10 MILLION RECALL CLAIM
Machining Enterprises, Inc. a/k/a Enterprise Auto Systems v Wausau Business Insurance Company, Michigan Court of Appeals, we recently obtained affirmance by the Michigan Court of Appeals of an arbitration award that our client, Wausau Business Insurance Company, had no duty to provide coverage or a defense for underlying claims made against Machining Enterprises, Inc. based on a General Motors recall in which MEI sought in excess of $10,000,000 from Wausau for indemnification and defense costs. MEI argued on appeal that the arbitrators had committed an error of law in refusing to follow the Supreme Court decision in American Bumper v Hartford Fire Insurance, 452 Mich 440 (1996), that the arbitrator refused to hear evidence and that the defense arbitrator and judge should have been disqualified. We successfully argued that the arbitrators committed no error of law and correctly applied every rule of Michigan insurance law including these set forth by the Supreme Court in the American Bumper case, that the arbitrators did not exclude any evidence, and that there was no basis to disqualify the trial judge or the defense arbitrator.
IN A PUBLISHED OPINION THE COURT OF APPEALS AGREES WITH MICHAEL F. SCHMIDT THAT A HOUSEHOLD EXCLUSION IN AN AUTO POLICY LIMITS COVERAGE OF THE INSURED TO THE MICHIGAN FINANCIAL RESPONSIBILITY ACT LIMITS OF $20,000/$40,000
In Manier v MIC General Insurance Corporation, 281 Mich App 485 (2008), the Court of Appeals has issued a published opinion which affirms the summary disposition we obtained from the Washtenaw County Circuit Court. This is a very important decision because it is the first published and hence first precedentially binding decision of any Michigan appellate court enforcing a household exclusion in an automobile liability policy which limits liability coverage for any claim by the insured or any family member to the Michigan Financial Responsibility Law limits of $20,000/$40,000. The decision reduced the coverage available under the policy from $100,000/$300,000 to $20,000/$40,000. This is a very important decision, because it now allows insurers to enforce such exclusions in Michigan.
CHRIS SCOTT WINS WRONGFUL DEATH RENTAL CAR EXCLUSION INSURANCE COVERAGE DISPUTE IN THE MICHIGAN COURT OF APPEALS
In Farm Bureau v GMAC, Farm Bureau filed a declaratory judgment action asserting no coverage in an underlying wrongful death case due to its insured not having proper permission from the owner of the vehicle. The Farm Bureau insured was driving a vehicle that had been rented by another relative so that the family could go down south for a funeral. During the trip, the family member that signed the rental agreement became ill and the Farm Bureau insured took over driving the rental vehicle with permission from the renter. While driving, he had a heart attack and the vehicle rolled over. Farm Bureau filed a declaratory action denying coverage while asserting reliance on the car rental agreement indicating there was no permissive use to any person not authorized as a driver under the rental agreement. The trial court granted summary disposition in favor of Farm Bureau relying upon an unpublished case where different insurance policy language was at issue. The Court of Appeals reversed, holding that the Farm Bureau exclusion was ambiguous and not enforceable, thereby effectively saving our client its policy limits.
MICHAEL F. SCHMIDT GETS $350,000 ARBITRATION AWARD VACATED
Dailey v Nationwide Insurance, Wayne County Circuit Court, We were retained to file a motion to vacate a $350,000 arbitration award in a claim for property damage pursuant to a homeowner policy. We argued that the arbitration award should be vacated because the arbitrator failed to follow controlling legal principles in awarding damages on theories which were not supported by law including defamation, intentional infliction of emotional distress and violation of the Michigan Consumer Protection Act. The trial court agreed and granted our motion and vacated the arbitration award and also appointed a new arbitrator.
MEL KARFIS AND BARRY SUTTON OBTAIN 25 MINUTE DEFENSE JURY VERDICT IN MARYLAND TREESTAND PRODUCT LIABILITY TRIAL
In Frank v. Summit Treestands, LLC., Frederick County, Maryland, Mel Karfis and Barry Sutton recently obtained a lightning fast defense verdict on behalf of their treestand manufacturing client. Plaintiff sought over $750,000.00 for serious spinal, chest and lung injury suffered when he fell 20 to 25 feet from his treestand. He maintained that the cause was the result of a failure of the metal frame of the treestand and that his failure to use his harness in the matter intended was a foreseeable misuse of the product. In a case which stressed the importance of warnings and safety videos, Barry and Mel, together with engineer-designer and safety pioneer Ron Woller, their experts, George Saunders (mechanical engineering) and L.J. Smith (renowned hunting safety expert), established that the metal deformation was the result of and not the cause of the fall, and that the plaintiff’s injuries were solely caused by his own decision to disregard repeated warnings to always wear his full body safety harness. Deliberating only 25 minutes, the jury found that the product was not defective and was reasonably safe for its intended uses. The case is important for the entire treestand industry because it pioneered the importance of safety videos (now co-packaged with every treestand) in the courtroom. Mel and Barry, and another partner, John Prew, have developed a national practice defending treestand manufacturers throughout the United States.
SUMMARY DISPOSITION MOTION FILED BY MICHAEL F. SCHMIDT GRANTED IN CONSTRUCTION ACCIDENT CASE BECAUSE IT DID NOT OCCUR IN A COMMON WORK AREA
Ferchak v George W. Auch Company, Genesee County Circuit Court, claim for injuries incurred by the plaintiff in a construction accident when he fell from the top of a pallet of cinder blocks from which he was working. The plaintiff claimed that the accident resulted in a serious ankle injury which has prevented him from returning to work in construction. We represented George W. Auch Company, the general contractor for the project. Following discovery we filed a motion for summary disposition on the basis that the accident did not occur in a common work area and that the plaintiff was more than 50% at fault which barred his claim for non-economic damages. We argued specifically that the area where the plaintiff was working, the top of the pallet of cinder blocks was not a common work area where any other employees or trades worked, and the plaintiff was more than 50% at fault for working from this area without any fall protection. The trial court agreed and granted our summary disposition.
MICHAEL F. SCHMIDT SUCCESSFULLY ENFORCES EXCLUSION IN POLICY FOR INSURED’S OWN PROPERTY LEADING TO DISMISSAL OF ALL CLAIMS
A & K Services v AMCO Insurance Company and Voss Insurance Agency, 28th District Court, claim for insurance coverage for a vehicle purchased by the insured which was allegedly stolen from its premises. Following discovery we moved for summary disposition on the basis that the policy excluded coverage for the insured’s own property, that there was no liability coverage because the claim was a first party claim, and that there was no claim against the agent for violation of the Michigan Consumer Protection Act. The trial court agreed and granted summary disposition as to all claims made by the plaintiff against both defendants.
COURT AGREES WITH MICHAEL F. SCHMIDT THAT INSURANCE POLICY PROPERLY CANCELLED
Gaugi Properties v AMCO Insurance, St. Clair County Circuit Court, claim by insured for alleged water damage in excess of $200,000 to the insured’s building. We filed a motion for summary disposition on behalf of AMCO on the basis that the policy was cancelled prior to the loss. Plaintiff argued that AMCO was estopped from raising the defense because it was not raised in the reservation of rights and denial letters, and because AMCO was aware that the address where the premium notices and cancellation notice were sent was not the insured’s appropriate address. We obtained summary disposition with the court finding that the cancellation was effective, that the application listed the primary, mailing, billing address, which is where AMCO sent the notices, and that AMCO was not estopped from raising the defense.
MICHAEL F. SCHMIDT PREVAILS IN COVERAGE DISPUTE DUE TO LACK OF PROPER NOTICE
Integon Insurance Company v Berry, Wayne County Circuit Court, Declaratory action filed to obtain a determination that Integon Insurance Company had no duty to provide coverage or a defense to the insureds in an underlying claim against the insureds arising out of a motor vehicle accident. We argued that the insureds had failed to provide notice of the accident, failed to provide notice of the underlying suit resulting in a default being entered against the insureds and failed to provide notice of the default. We were successful in obtaining a summary disposition that Integon had no duty to provide coverage or a defense to the insureds in the underlying action due to the lack of notice which was to the prejudice of Integon.
COLLEEN JOLICOEUR EARNS LL.M. IN LABOR AND EMPLOYMENT LAW
Harvey Kruse, P.C. would like to congratulate Colleen T. Jolicoeur for earning her LL.M. in Labor and Employment Law from Wayne State University Law School in May 2008. Ms. Jolicoeur is an associate in the firm’s Troy branch. Ms. Jolicoeur focuses her practice in the areas of Employee Benefits, Employment Law, Environmental Law, Insurance Defense, and Products Liability.
MATERIAL MISREPRESENTATIONS IN INSURANCE POLICY APPLICATION LEAD U.S. DISTRICT COURT TO ACCEPT MICHAEL F. SCHMIDT’S ARGUMENT THAT COVERAGE SHOULD BE RESCINDED IN CASE INVOLVING CATASTROPHIC INJURIES INCLUDNG LOSS OF AN EYE
Mohammed Huda v. Integon National Insurance Company, United States District Court for the Eastern District of Michigan, claim for no-fault benefits and uninsured motorist benefits by the plaintiff arising from a motor vehicle accident in which the insured sustained catastrophic injuries including loss of his right eye. We defended the case on the basis that the plaintiff/insured made a material misrepresentation in the application for the policy by failing to disclose all of the household members who were of driving age including his son Mohammed Huda, Jr. We argued that this served as the basis for rescission of the policy. The Detroit Medical Center intervened as a plaintiff to support the plaintiff’s claim. On cross-motions for summary judgment filed by all of the parties, the court agreed with our motion and ruled that the policy was properly rescinded from its inception based on the material misrepresentation in the application.
MICHAEL F. SCHMIDT WINS WORKER’S COMPENSATION INSURANCE DISPUTE
AM Polis, Inc. and Polis Audish v Jeffrey H. Kaplan Agency, Inc. and Amanda M. Stephen, Wayne County Circuit Court, claim by the plaintiff and the plaintiff’s corporation for workers’ compensation insurance. Plaintiffs alleged that they applied for and requested a policy of workers’ compensation insurance from the defendant insurance agency. They further argued that they cancelled existing coverage in reliance upon obtaining such coverage. Following discovery we moved for summary disposition on the basis that the defendants were direct agents of Nationwide, that none of the exceptions to the general rule of no liability as set forth by the Supreme Court decision in Hartes v Farmers Insurance Exchange, 461 Mich 1 (1999) applied, that the plaintiff had a duty to read his policy and raise any questions regarding coverage within a reasonable time, that discovery disclosed that the plaintiff did not cancel any other coverage in reliance on the Nationwide policy and that the plaintiff never requested workers’ compensation coverage. The court granted our motion for summary disposition dismissing the plaintiffs’ complaint with prejudice.
CRIMINAL ACT EXCLUSION SUCCESSFULLY ARGUED BY MICHAEL F. SCHMIDT IN INSURANCE COVERAGE LITIGATION
Schomer v MIC General Insurance Corporation, Oakland County Circuit Court. This case was a declaratory action filed by the MIC insured and joined by the underlying plaintiff against MIC to determine whether the criminal act exclusion in the MIC policy excluded coverage and to determine whether the motor vehicle’s operator had permissive use. The MIC insured, Jean Schomer, allowed her granddaughter to use her vehicle. Her granddaughter in turn allowed her boyfriend, who did not have a valid operator’s license, to use the vehicle, contrary to the grandmother’s instructions. While on the way to see his parole officer, the boyfriend decided to stop at a grocery store parking lot to attempt to steal a purse from a customer. He failed in the attempt and then fled the scene. The attempted theft was reported, and as he was driving eastbound on 696 he was spotted by a police officer who began chasing him. He fled eastbound on 696 and then exited onto southbound I-75 and was driving on the shoulder to avoid traffic when he struck the underlying plaintiff’s vehicle causing it to turn over and injuring its occupants. He then continued driving over a hill, down an embankment, over a cement wall and onto southbound I-75 where he continued fleeing until his car failed and he ran from the scene. He turned himself in the next day. He then pled nolo contendre to third-degree fleeing and eluding. He was sentenced and imprisoned. The policy excluded coverage for bodily injury or property damage which may reasonably be expected to result from the intentional act of an insured or which is in fact intended by an insured or which is a criminal act. The exclusion only applied to damages in excess of the minimum limits provided by the Financial Responsibility Law. We deposed the boyfriend in prison and he admitted all of the elements of third degree fleeing and eluding. We then filed a motion for summary disposition to enforce the policy exclusion in excess of the Financial Responsibility limits. The insured and the underlying plaintiff argued that the exclusion was contrary to public policy as held by several recent Michigan Court of Appeals decisions and was also ambiguous and unenforceable. We argued that the exclusion was not ambiguous, that there was no issue of fact, that the vehicle’s operator admitted all of the elements of third-degree fleeing and eluding at the time of the accident, that the accident occurred during the course of the fleeing and eluding, and that the exclusion was not contrary to public policy or the No Fault Act or Financial Responsibility Act because it was only enforceable in excess of the Financial Responsibility limits. We also argued that regardless of whether coverage for any criminal act in the use of a motor vehicle was excluded, this was not a valid public policy defense because normal traffic offenses are only civil infractions and are not criminal acts, and moreover, the legislature has determined that the only necessary liability coverage is $20,000/$40,000 and that any coverage in excess of this amount is subject to contract limitation. The court agreed with our argument and granted summary disposition enforcing the exclusion which reduced the available coverage from $100,000/$300,000 to $20,000/$40,000.
FRANK PORRETTA WINS INSURANCE CANCELLATION CASE BEFORE JUDGE COLOMBO IN WAYNE COUNTY CIRCUIT COURT
In E & O Taxi v Insurance Services of Detroit, a taxicab company, which had financed the $150,000 annual premium on its commercial insurance policy, alleged that it had made all installment payments to its agent, which had failed to convey the payments to the premium finance company or to our client, the insurance carrier. The premium finance company sent out a “Notice of Intent to Cancel” and then sent out a “Notice of Cancellation” as required by statute, and requested that the carrier cancel the policy. The taxicab company claimed the carrier had breached duties to notify it that the premium had not been received and to notify it of the cancellation. The Court disagreed and granted Frank Porretta’s motion for summary disposition, finding that the cancellation and notices complied with MCL §500.1511, and the carrier owed no additional duties to the insured, relying on Doshi v Michigan Basic Property Ins Ass’n, 229 Mich App 595, 603, 582 NW2d 542, 546 (1998).
MICHAEL F. SCHMIDT PREVAILS IN FIRST PARTY INSURANCE COVERAGE DISPUTE AMONG CARRIERS OVER A FIRE ON PROPERTY OWNED BY GM GRAND
Northland Insurance Co. as Subrogee of GM Grand v Century Surety Company and Adel Abbas Hashim, Wayne County Circuit Court, claim for $148,000 in property damage from a fire to property owned by GM Grand and insured by Northland Insurance Co. Northland filed suit as subrogee of GM Grand against Century Surety Company and Adel Abbas Hashim seeking coverage for the loss under the policy of insurance issued by Century Surety Company to the tenant Hashim and seeking recovery against Hashim for the damages pursuant to the lease. We were successful in obtaining summary disposition from Judge Wendy Baxter for both Century Surety and Hashim, on the basis that the Century Surety policy did not provide first party property coverage to GM Grand and that although GM Grand was an additional insured on the Century Surety policy, the policy did not provide any property coverage for GM Grand’s loss and also did not provide any liability coverage to Adel Abbas Hashim for the claims made by Northland. The court further ruled that Adel Abbas Hashim had no liability to GM Grand under the lease, because although the lease stated that the tenant assumed the entire risk of loss for damage to all or any part of the property, a separate lease provision required the landlord to insure the property. There had been a case evaluation award in favor of the plaintiff in the amount of $25,000.
MICHAEL F. SCHMIDT WINS COLLAPSING WALL INSURANCE COVERAGE LITIGATION
Northstar Petroleum, Inc. v L & M Masonry Enterprises and Allied Insurance, Oakland County Circuit Court. The plaintiffs, Northstar Petroleum, Inc., Atlantis Development Corporation and Atlantis Management Co., brought suit against L & M Masonry Enterprises, Inc. and Allied Insurance seeking to recover approximately $300,000 in damages for the collapse of a wall which was part of a construction project for a shopping center. The wall collapsed due to high winds and as a result adjacent walls also had to be torn down and replaced. The plaintiffs were the owners and general contractor for the project and brought suit against L & M, the masonry subcontractor, and Allied Insurance. The claims against Allied were based on the contract documents which required L & M to obtain a policy of insurance naming the plaintiffs as insureds and also to obtain insurance providing liability coverage for L & M. We filed a motion for summary disposition on behalf of Allied arguing that the plaintiffs were not insureds under the policy issued by Allied to L & M, and even if they were insureds, the policy was a commercial general liability policy which did not provide any first party coverage. We also argued that there was no coverage available to L & M for any of the claims made by the plaintiffs because all of the damage was to L & M’s own work or was incurred in repair and replacement of L & M’s work, and thus there was no “occurrence”, no “property damage” and coverage was also excluded by the business risk exclusions. The plaintiffs entered a default against L & M in the amount of $288,000 and we obtained an order of dismissal as to any and all claims against Allied determining that Allied provided no coverage to the plaintiffs, and also had no duty to provide any coverage or defense to L & M for any of the claims made by the plaintiffs.
MICHIGAN COURT OF APPEALS OVERTURNS TRIAL COURT AND RULES FOR MICHAEL F. SCHMIDT IN CONTRACTUAL INDEMNITY CASE
In Empire Fire & Marine Insurance Co. v Minuteman International, Empire Fire filed suit as subrogee of General RV Center, Inc. to recover in excess of $5.5 million in damages as a result of a fire at the General RV Center, Inc. facility in Wixom, Michigan. Empire Fire alleged that a floor scrubber manufactured by Minuteman International, Inc. caused the fire. We represented Minuteman and filed a third party complaint against Lester Electrical, the manufacturer of a battery charger which was a component part of the floor scrubber, on the basis that the defect which the plaintiff alleged in the floor scrubber was in the battery charger. The plaintiff’s complaint was eventually dismissed for a $12,000 settlement, and we then sought contractual indemnity for all of the defense costs and attorney fees incurred in defending the claim from Lester Electrical pursuant to an indemnity contract. The trial court denied our motion for summary disposition and granted summary disposition to Lester Electrical. In Empire Fire & Marine Insurance Co. as Subrogee of General RV Center, Inc. v Minuteman International, Inc., unpublished per curiam decision of the Michigan Court of Appeals docket number 274660 (2008), the Court of Appeals reversed the trial court and ordered summary disposition in favor of Minuteman for full contractual indemnity from Lester Electrical. The court held that the plaintiff did not have to make allegations against Lester Electrical in order for Minuteman to obtain contractual indemnity, because the evidence established factual support to enforce the contractual indemnity agreement.
MICHAEL F. SCHMIDT PREVAILS IN MULTI-VEHICLE ACCIDENT LITIGATION
David W. Allard, As Trustee of The Bankruptcy Estate of Laura J. Wilamowski v Joseph A. Sova, State Farm Mutual Automobile Insurance Company, Clarkston Steel, Inc., Conrad C. Wilamowski and Mirash Bojaj, Oakland Court Circuit Court, Judge Fred M. Mester, plaintiff brought suit against multiple defendants alleging injuries incurred in a multi-vehicle accident. The plaintiff claimed that she had a lumbar laminectomy and total and permanent disability from prior cervical fusions as a result of the accident. We argued that the defendants, Sova and Clarkston Steel, had no liability and that Sova’s truck was knocked into the median by another vehicle, where it stopped. The trial court agreed and granted summary disposition holding that there was no evidence of anything other than an “accident” and no negligence on the part of the defendants.
INSURANCE DISPUTE IN CATASTROPHIC INJURY CASE WON BY MICHAEL F. SCHMIDT
Jaclyn Allen v Nationwide Mutual Fire Insurance Company and Auto-Owners Insurance Company, Washtenaw County Circuit Court, involved a claim for no fault benefits for catastrophic injuries to the plaintiff. The issue was whether the plaintiff was a resident of her parents’ household and thus entitled to no fault benefits under the Nationwide policy issued to her parents or was a resident of her grandmother’s household and thus entitled to no fault benefits from her grandmother’s insurer Auto-Owners. Auto-Owners argued that the plaintiff had indicated on her vehicle registration and driver’s license that she was a resident of her parents’ household. We argued that pursuant to the affidavits of the witnesses, including the plaintiff, her parents, her grandmother and other family members and neighbors, that the plaintiff was a resident of her grandmother’s household. We argued further that Auto-Owners’ argument regarding the driver’s license and vehicle registration did not raise any genuine issue of material fact. The court, Judge Archie C. Brown, agreed and ordered summary disposition in favor of the plaintiff and against Auto-Owners, and dismissed all claims against Nationwide.
IN A PUBLISHED DECISION THE MICHIGAN COURT OF APPPEALS AFFIRMS SUMMARY DISPOSTION FOR DALE BURMEISTER IN A CASE RAISING CONSTITUTIONAL AND REAL PROPERTY ISSUES IN A DISPUTE BETWEEN A CABLE OPERATOR AND A LARGE LANDOWNER
In Heydon v MediaOne, the Michigan Court of Appeals has affirmed in a published decision a variety of dispositive rulings involving a dispute between a large landowner and a cable television operator. The four major questions before the Court where 1) whether the Cable Communications Policy Act of 1984 violates the takings clause in the United States Constitution; 2) whether the Cable Communications Policy Act of 1984 prohibits “piggy-backing” on private easements; 3) whether prescriptive easements may be assigned; and 4) whether a public utility that apportions a prescriptive easement for use by a cable operator to string its wire imposes a new burden on the existing easement. On all four issues, the Court of Appeals ruled in favor of Dale’s client. Click here to view the opinion of the Court.
MICHAEL F. SCHMIDT PERSUADES A FEDERAL COURT TO GRANT SUMMARY JUDGMENT IN HOMEOWNER MISREPRESENTATION CASE
In Lacresia Nolan v Nationwide Mutual Fire Insurance Company, plaintiff filed suit seeking recovery for fire damage to her home insured by Nationwide for $161,000. After completing discovery we moved for summary judgment on the basis that the policy of insurance was rescinded from its inception due to the plaintiff/insured’s misrepresentations in the application for insurance. The plaintiff argued that Nationwide had to prove an intentional misrepresentation, that Nationwide undertook to inspect the premises and should have ascertained that they were vacant, and that the plaintiff advised the agent that she was not residing in the premises and only intended to move in the future contrary to the written application, thus estopping Nationwide from raising a misrepresentation in the application and that Nationwide knew the premises would be vacant because they were being remodeled or under construction. The court rejected all of these arguments holding that the misrepresentation did not have to be intentional, that Nationwide had no duty to investigate to determine if the representations in the application were correct, that the plaintiff/insured did not provide oral information to the agent contrary to all of the misrepresentations in the application and thus Nationwide was not estopped from raising the defense of the application and the fact that the home was allegedly being remodeled or under construction was irrelevant to the misrepresentations. The court granted summary judgment to Nationwide dismissing all of the claims.
MICHAEL F. SCHMIDT VICTORIOUS IN TREE STAND CASE IN FEDERAL COURT FOR BASS PRO SHOP
Hilaski v Bass Pro Shop, U. S. District Court for the Western District of Michigan, claim by the plaintiff for injuries including a fractured ankle resulting in surgery and internal fixation from falling from a tree stand which he claimed was improperly designed, manufactured and sold. We filed a motion for summary judgment on the basis that there was no proof or evidence that the tree stand was sold by Bass Pro Shop, that the claim was based on speculation and conjecture, and that even if the tree stand was sold by Bass Pro Shop, there was no proof of any negligence by Bass Pro Shop in the sale of the tree stand, no evidence of any express warranty, and no evidence of any breach of an express warranty. In response to our motion for judgment, the case was dismissed.
MICHAEL F. SCHMIDT WINS MOTION FOR SUMMARY JUDGMENT IN CONSTRUCTION ACCIDENT CASE REMOVED TO FEDERAL COURT
Thomas Craig v Walsh Construction Company of Illinois, U. S. District Court for the Eastern District of Michigan, plaintiff brought suit against Walsh Construction Company of Illinois as general contractor for injuries from a construction accident. Craig fell approximately 25 feet from shoring which was being dismantled by his employer’s work crew. The plaintiff claimed permanent disability from his work as a carpenter from alleged multiple injuries from the fall. There was a comp lien of approximately $200,000. We removed the case to U. S. District Court, to complete discovery and filed a motion for summary judgment on the basis that the plaintiff’s claim against Walsh as general contractor was barred because there was no common work area. We obtained a summary judgment from Judge Arthur Tarnow on the basis that there was no evidence of a common work area.
JIM SUKKAR WINS LEMON LAW TRIAL IN KALAMAZOO
Jim Sukkar obtained a defense verdict in a two day jury trial in the Kalamazoo Circuit Court. Jim represented a foreign auto manufacturer sued for breach of express and implied warranty arising out of the sale of a new motor vehicle. The Plaintiff, Ronald Leggitt, claimed that as a result of a faulty oil pump, oil was discharged from the engine of his 18 month old vehicle. Plaintiff’s expert, a certified mechanic testified that based upon the wear observed he believed that the oil pump malfunctioned causing increased oil pressure which resulted in loss of oil through the oil filter port. Jim presented the dealer mechanic who inspected the vehicle the day after the occurrence as well as the manufacturer’s regional parts and service manager. The mechanic observed that the oil was expelled through the oil filter port. However, the aftermarket oil filter which was not installed by an authorized dealer was misaligned and improperly installed. The parts and service manager determined that the warranty did not apply under these circumstances. The jury found that the condition that gave rise to the engine failure was not the responsibility of the manufacturer.
MICHAEL F. SCHMIDT PERSAUDES COURT TO REFORM INSURANCE POLICY AND DENY ENHANCED COVERAGE AS A MATTER OF LAW
Manier v MIC General Insurance Corporation, Washtenaw County Circuit Court. Plaintiff filed suit seeking a declaratory judgment that MIC had improperly rescinded and reformed an auto liability insurance policy based on a misrepresentation in the application. The minor plaintiffs were all severely injured in an auto accident and sought recovery under the MIC policy issued to William D. Manier for the policy limits of $100,000/$300,000. We succeeded on a motion for summary disposition on the basis that the policy of insurance issued to Manier’s parents was reformed due to an intentional misrepresentation made by Manier’s mother that Manier resided with his parents and that his vehicles were garaged there. MIC discovered this misrepresentation after an accident involving one of Manier’s vehicles in which his three children were injured. We successfully argued that under the reformed policy the children were “family members”, and thus pursuant to the household exclusion, any liability coverage available to them would be limited to the Michigan financial responsibility limits of $20,000/$40,000.
MICHAEL F. SCHMIDT WINS $10 MILLION INSURANCE COVERAGE ARBITRATION
Machining Enterprises, Inc. v Wausau Business Insurance Company, Oakland County Circuit Court number 04-056494-CK, claim by Machining Enterprises, Inc. for insurance coverage for underlying claims made against Machining Enterprises, Inc. (“MEI”) based on a General Motors recall, in which MEI sought in excess of $10,000,000 for indemnification and defense costs. After the case pended in Oakland County Circuit Court for a year, the case was sent to binding arbitration. After a week long arbitration hearing, the arbitrators ruled in a 2-1 written decision that Wausau had no duty to provide coverage or a defense to MEI for the underlying claims, that there was no “occurrence”, that there was no “property damage”, that coverage was barred by the “work/product” exclusions (k), (l), (m) and (n), that the only damage referred to was to MEI’s own product and for repair and replacement of MEI’s own product, that there was never any claim for “property damage” as defined by the policy, that MEI’s conduct in regard to Wausau’s investigation showed that MEI did not believe that the claims were covered and that MEI breached its obligation to cooperate and provide notice to Wausau regarding the underlying claims. Following entry of the arbitration award, Wausau filed a motion to enter judgment on the award and MEI filed a motion to vacate the award. After the parties submitted briefs and argued the motions, Judge Goldsmith entered his opinion and order granting Wausau’s motion to enter judgment on the arbitration award and denying MEI’s motion to vacate the arbitration award, holding that the arbitration panel correctly cited and applied controlling principles of insurance law and that the arbitrators did not refuse to hear material evidence submitted by MEI.
JIM SUKKAR VICTORIOUS IN SEVEN DAY TRIAL
Jim Sukkar prevailed in a seven day jury trial before Judge Robert Ziolkowski of the Wayne County Circuit Court. Sukkar represented a truck driver and a trucking company in a lawsuit filed by Jill and Donald Yanick arising out of a January, 2005 incident where the Plaintiffs alleged scrap flew from Defendants’ truck and struck the vehicle driven by Jill Yanick, and as a result Mrs. Yanick slammed on her brakes and, in an attempt to avoid flying debris, twisted her body which resulted in a herniated disc at L5-S1 which required surgery. It was the Defendant’s position that Mrs. Yanick’s condition was pre-existing and of a degenerative nature. Jim presented a biomechanic who testified as to the low level of force involved in bringing a vehicle to a stop. Mrs. Yanick had surgery in 1989 for herniated discs at the L2-3 and L3-4 levels. It was noted that the L5-S1 disc was degenerating at that time. Mrs. Yanick’s surgeon disabled her from working as a nurse and testified that her condition was caused by the subject accident. The jury did not agree and found that Mrs. Yanick was not injured.
MICHAEL F. SCHMIDT WINS UNDERINSURED HEART ATTACK DEATH CASE AND SAVES CLIENT $250,000
Jimmy Kasmikha, as Personal Representative of the Estate of Selma Kasmikha, Deceased v Integon National Insurance Company, Oakland County Circuit Court, plaintiff filed a claim for underinsured motorist benefits seeking the underinsured motorist limits of $250,000 as a result of an auto accident with an alleged underinsured motorist which allegedly resulted in a heart attack and death of Selma Kasmikha. The plaintiff initially sued the underinsured motorist, who settled for the policy limits of $100,000. The plaintiff then filed the underinsured motorist claim against Integon. We filed a motion for summary disposition arguing that the underinsured motorist claim was barred by the release entered in the underlying action which released the underlying tortfeasor and “all other persons, firms, corporations, liable or who might be claimed to be liable. . .” The plaintiff responded that Integon had approved the underlying settlement, and that the parties to the underlying case did not intend to release the underinsured motorist claim. The plaintiff and the insurer of the underlying defendant submitted a reformed release indicating that their intent was specifically not to release the underinsured motorist claim. In addition, the plaintiff filed a cross-motion for summary disposition arguing that there was no issue of fact, and that the underinsured motorist was responsible for the accident and the experts had established that the decedent’s heart attack was a result of the auto accident. We responded that there were issues of fact regarding who caused the accident and whether the heart attack was a result of the auto accident, but more importantly, that Integon was a third party beneficiary of the underlying release and that Integon’s rights became vested as soon as the release was executed and thereafter the plaintiff and the underinsured motorist and his insurer had no right to make any modification of the release to the detriment of Integon. The trial court agreed with all of our arguments and granted summary disposition in favor of Integon.
MICHAEL F. SCHMIDT WINS SUMMARY DISPOSITION IN BREACH OF CONTRACT AND BAD FAITH ACTION
Latta v Nationwide Property & Casualty Insurance Company and Kimberly Byrne, claim for bad faith and breach of contract seeking to enforce an alleged settlement agreement of an underlying claim by Chad Latta against a Nationwide insured, Glenwood Apartments, for an alleged premises injury claim. The plaintiff’s claim in the underlying action was for $200,000. The plaintiff made numerous offers, Nationwide made two counter-offers, but the plaintiff did not accept either of Nationwide’s counter-offers and continued making additional offers until the statute of limitations expired with no agreement being made. We obtained a summary disposition on behalf of Nationwide and the Nationwide claim rep, Kimberly Byrne, on the basis that the plaintiff had no claim for bad faith against the insurer of a defendant, and that the plaintiff’s claim to enforce the settlement failed because the plaintiff failed to prove an offer and acceptance.
MIKE GUSS AND CHRIS SCOTT WIN DEFENSE VERDICT
IN PARAMEDIC MALPRACTICE DEATH CASE
Mike and Chris won a defense verdict in a two week paramedic malpractice wrongful death case, wherein the decedent’s survivors alleged that the decedent, after having sustained a fall and a C2 odontoid fracture, was mishandled by the paramedic and EMS crew, resulting in a shift and/or displacement of an odontoid fracture. The fracture allegedly compressed the spinal cord, resulting in a pulmonary and cardio arrest, and resultant brain damage. Decedent was removed from life support several days later.
Plaintiffs alleged conscious pain and suffering on behalf of the decedent and the loss of love and society for 11 children and 44 grandchildren.
The trial proofs concerned the testimony of approximately 9 lay witnesses and 7 medical treaters and experts. The defendant’s case was based upon an assertion that the scene witnesses (decedent’s family members) fabricated their version of events, and it was asserted that their version of events was not consistent with EMS and initial hospital triage documentation.
The jury returned a verdict for defendant in approximately an hour and five minutes. The defendant will be entitled to approximately $60,000 to $80,000 in case evaluation sanctions.
DENNIS GOEBEL AND MEL KARFIS PREVAIL IN DEATH CASE
IN MICHIGAN COURT OF APPEALS
This is a wrongful death product liability case in which Vernon Wingard was caught between the end of a conveyor and fixed barrier guarding. He was crushed to death. The Estate claimed that the conveyor was negligently designed, was defective and was unreasonably dangerous. The case was defended on the basis that the customer was offered but did not order the manufacturer’s suggested light curtain guarding. Subsequent to issuance of the purchase order the customer directed a third-party to install end of the line barrier guarding. The case was tried and the jury returned a verdict of “no cause for action”. Plaintiff took an appeal alleging that sufficient evidence had been submitted and that the Court should have directed a verdict in favor of the Plaintiff. The Court of Appeals upheld the Trial Jury’s verdict of no cause for action.
DENNIS GOEBEL AND MEL KARFIS WIN PRODUCTS CASE
IN FEDERAL COURT
United States District Judge David Lawson has granted a Motion for Summary Judgment filed by Dennis and Mel in this product liability case in which the quadriplegic Plaintiff claimed that his use of an allegedly defective ROHO air cushion caused a stage 1 pressure sore which did not heal and which became a stage 4 open wound. The Plaintiff alleged that the air cushion was defectively designed and manufactured such that in June 2001 there was a catastrophic loss of air from the cushion. The loss of air allegedly caused the Plaintiff to “bottom out” resulting in a pressure sore on his buttocks. The Plaintiff claimed that the loss of air was due to a change in ambient temperature, his left pelvic obliquity, shifting weight during the course of the day, the cushion allowed capillary occlusion to occur and/or that the air valve may have leaked. The Defendant denied that the cushion was negligently designed and/or manufactured. The Plaintiff used the Defendant’s cushion for several years before the incident and for two years afterward. There were no prior instances of catastrophic air loss. In addition, pressure sores can develop in quadriplegic patients even when they are most vigilant about their pressure relief regimen. The Court granted Summary Judgment because the Plaintiff failed to produce evidence of causation. The Court found that the Plaintiff did no more than describe possibilities and therefore amounted to speculation.
LARRY DAVIDSON WINS A SLIP AND FALL
AND TWO FOOD POISONING CASES FOR BRAVOKILO
In the past few months, Larry Davidson has won three cases for Bravokilo, Inc., the operator of many Burger King restaurants in Michigan, without even having to appear for oral arguments. Two of the cases were pending in Washtenaw County Circuit Court and the third was filed in Saginaw District Court. Two of the cases alleged food poisoning, and the third was a premises liability action:
In Reid v. Bravokilo, Inc., the plaintiff brought a premises liability action in Washtenaw County Circuit Court, alleging that he fell on a step within the restaurant. After the plaintiff testified at deposition regarding the facts and circumstances of the incident, a motion for summary disposition was filed on the basis that the condition of the premises was open and obvious. Plaintiff’s counsel did not respond to that motion and the court granted summary disposition without requiring oral argument.
In McKissic v. Bravokilo, Inc., the plaintiff alleged that she suffered food poisoning after consuming food from a Burger King restaurant. After obtaining the testimony of the plaintiff under oath, we filed a motion for summary disposition. The primary argument was that the food purchased from Burger King could not have been the source of the bacteria because the incubation period between the time of consumption and the presence of symptoms was insufficient according to the prevailing view of the medical community. The plaintiff initially responded to the motion, but then agreed to dismiss the matter with prejudice on the day before the scheduled hearing date.
In Mahony v. Bravokilo, Inc., the plaintiff filed an action in the Saginaw District Court, alleging food poisoning. We ultimately convinced the attorney for the plaintiff to dismiss the action with prejudice after establishing that the restaurant in question was not operated by Bravokilo, Inc.
DALE BURMEISTER WINS ANOTHER FEDERAL CABLE COMMUNICATIONS ACT CASE
IN WASHTENAW COUNTY CIRCUIT COURT
An electrical utility company acquired a prescriptive easement to run electrical lines across a parcel of property but the property owner challenged the right of a cable operator to piggyback on that easement to string its television and internet wire. Judge Morris ruled, however, that the cable company’s wire did not impose an additional burden on the prescriptive easement and held that adding the cable to existing utility poles did not run afoul of the Constitution.
DENNIS GOEBEL AND MEL KARFIS WIN FOUR-WEEK FEDERAL JURY TRIAL
IN AIRPLANE CRASH CASE
Randall Torno and his wife filed a products liability action in the Federal Court in Detroit alleging that he sustained an L1 burst fracture and paraplegia as a result of an experimental aircraft crash in which Mr. Torno claimed that an RE Phelon engine ignition component failed causing his aircraft to lose power and crash in Monroe County, Michigan in June 2001. Mr. Torno was an engineer who built an experimental aircraft which utilized a 50 horsepower two-cycle engine. He claimed that an RE Phelon trigger coil was used in the ignition system, that the coil failed, causing the engine to overheat, burn a hole in one of the pistons, that there was a loss of power and that the aircraft crashed resulting in his permanent injuries. The case was defended on the basis that the trigger coil did not fail, but that Mr. Torno’s alterations to the engine and its components resulted in a lean fuel mixture causing the engine to overheat and burn a hole in one piston. As a result of the crash, Mr. Torno sustained an L1 burst fracture of his vertebrae. He sustained a permanent loss of use of his lower extremities as well as affecting internal organs effected by the paraplegia. In addition, Mr. Torno was an engineer who earned $75,000 a year and claimed reduction and earning capacity, future attendance services and other economic damages. After a four week trial the jury returned a verdict that RE Phelon Company was not negligent, i.e., no cause for action.
DALE BURMEISTER AWARDED $10,000 IN CONTEMPT OF COURT SANCTIONS
IN TRADEMARK DISPUTE
Following a full evidentiary hearing in federal court, Judge Cook awarded nearly $10,000 in contempt of court sanctions for violations of a permanent injunction Dale had obtained involving Subway trademarks and trade dress. Defendant also agreed at the hearing to remove or paint over various marks, copyrighted menu items, and decorative touches that had a tendency to mislead the public into believing that the restaurant was a franchised operation.
BILL RIVARD WINS NO CAUSE VERDICT
IN ACCOUNTING MALPRACTICE SUIT
Bill Rivard recently received a defense verdict for our client in an accounting malpractice suit following a jury trial in Oakland County Circuit Court. Plaintiffs, husband and wife, for whom defendant had prepared tax returns for more than 20 years, claimed that in February of March, 2004, one or the other of them brought defendant $499,000 in W2Gs for slot machine winnings for the year 2003. The parties disagreed on the date the documentation was brought to defendant, and whether plaintiffs brought any documentation of losses. Defendant testified he advised plaintiffs he needed documentation of losses to complete the return and waited. About one year after leaving their documents with defendant, plaintiffs demanded return of the documentation they provided him, and there was a dispute regarding whether defendant complied with their request by making their documentation available to them. Plaintiffs claimed damages for late filing fees and interest allegedly payable to the state and federal governments, and accounting fees for having to have an accountant reconstruct their documentation from IRS “transcripts.” Defendant argued that even the documentation of losses plaintiffs presented at trial, which was the documentation they allegedly provided in 2004, was insufficient to prepare an accurate return, since records of losses were only for partial casino play while using a so-called “players club” card. Bill had plaintiff’s expert accountant barred from testifying to state penalty and interest when he established by voir dire of the expert that no assessment had issued, the first of several steps required for the state treasurer to establish liability under by Michigan statutes, and because the accountant had never represented a client through the administrative steps for assessment, appeal, etc., provided by Michigan statutes. Plaintiffs’ claim for accounting malpractice was dismissed by the court because defendant was not a certified public accountant. The jury returned verdicts for defendant on plaintiffs’ claims for breach of contract, fraud, and claim and delivery. An appeal was not filed.
DENNIS GOEBEL WINS INTERLOCUTORY APPEAL IN PRODUCTS CASE
ON IMPORTANT ISSUE INVOLVING NON-PARTY FAULT OF AN EMPLOYER
In Sandusky v McNally Electric, Inc., we filed a notice of non-party fault of the employer in a products liability case. Plaintiff then amended the complaint and added the employer as a direct defendant. At the end of discovery, the employer filed a motion for summary disposition which was “opposed” by the plaintiff. The trial court granted summary disposition in favor of the employer finding that there was no evidence of intentional act. Thereafter, plaintiff moved to strike our notice of non-party fault alleging that the employer owed no duty to the employee and in addition, that since the court granted summary disposition for the employer that it precluded our notice of non-party fault. We took an interlocutory appeal which was accepted by the Court of Appeals. Briefs were submitted to the Court of Appeals which decided the issue without oral argument. The Court of Appeals found that the plain language of the comparative fault statutes, MCL 600.2957 and 600.6304, allows the employer to be identified as a non-party at fault. Further, it held that there is no conflict with the Worker’s Disability Compensation Act, MCL 418.101. The Court of Appeals ruled that the trial court erred in both concluding that a duty is required in order to assess fault against the non-party and that there was no duty owed to plaintiff by the employer in the case.
DALE BURMEISTER PREVAILS IN THE MICHIGAN COURT OF APPEALS
IN FEDERAL CABLE COMMUNICATIONS ACT CASE
In Heydon v MediaOne, a dispute arose over attaching or “piggybacking on” utility pole easements running across private property in the Ann Arbor area. A variety of claims and defenses were involved in the litigation, including a constitutional challenge to the Federal Cable Communications Act of 1984, whether attaching a coaxial cable to existing electric utility poles unreasonably increased the burden on the easement, whether an unrecorded right of way agreement could be assigned, and the like. The Michigan Court of Appeals ruled as a matter of law that the attachment of a cable television wire to poles within an electric company’s easement does not materially increase the burden on the servient estate. It went on to find that because our client’s intended use of the easement would not have violated the terms of the servitude or unreasonably increase the burden on the servient estate, Detroit Edison was entitled to partially assign an interest in its utility easement to MediaOne. Finally, it concluded that reasonable access of the easement by our client did not and would not in the future constitute trespass. A motion for rehearing in the Court of Appeals has also now been denied.
DENNIS GOEBEL AND MEL KARFIS WIN PRODUCTS LIABILITY
AMPUTATION CASE IN FEDERAL COURT
This was a product liability lawsuit in which forty-eight year old James Cobbs was employed by Jay Dee Contractors. Jay Dee Contractors is involved in underground tunneling. It uses a tunneling machine to bore a hole in the ground and then lines the hole with cement grout. Jay Dee Contractors purchased a grout pump machine from Schwing America Inc. On May 23, 2002 Mr. Cobbs was cleaning the grout pump at the end of the day. He had the hoses off and portions of the machine exposed letting it run while he sprayed water on the interior of the machine. He claims that he was looking for a shutoff switch and as he leaned against the machine his right hand was sucked into an inlet and he sustained amputations of the tips of three fingers of the right hand. He claimed that the machine was defective because it did not have an interlock device and that the Defendant failed to properly warn of the dangers. Mr. Cobb claimed that he was not able to return to work and had psychological injuries in addition to the amputation injuries. Forty-eight months after the accident Mr. Cobbs had still not returned to work. On February 13, 2006, Judge Duggan issued a written opinion granting our summary judgment for Schwing America, Inc. Judge Duggan found that pursuant to MCL 600.2947(7), misuse did occur by Mr. Cobbs intentionally reaching twelve inches into the machine while it was operating and therefore granted the motion on the basis of misuse. Judge Duggan also found that the Plaintiff failed to satisfy the six elements of the Michigan Risk Utility Test.
MICHAEL F. SCHMIDT PREVAILS
IN CONSTRUCTION ACCIDENT CASE
Steven Nickell and Hayley Nickell v Howard Structural Steel, Inc., et al, Wayne County Circuit Court, claim by Steven Nickell, an ironworker, for construction accident injuries sustained in a fall on a construction project. The injuries included an acetabular fracture, lower back injuries and an alleged closed head injury and neuropsychological problems. We represented Howard Structural Steel, the structural steel contractor who contracted with Nickell’s employer, American Erectors, to do the erection. We filed a motion for summary disposition arguing that the plaintiff’s claim against Howard for failing to provide guardrails on the job failed to state a claim because the subcontractor, American Erectors, had contracted to provide 100% fall protection, pursuant to Fultz v Union-Commerce Associates, 470 Mich 460 (2004), even if Howard had a contractual duty to deliver guardrails, this did not create a negligence claim, and further the American Erectors’ foreman testified that even if guardrails had been delivered he would not have installed them at the time of the accident. The case evaluation award against Howard was zero dollars and the case was dismissed.
BARRY SUTTON PREVAILS IN SERIOUS IMPAIRMENT CASE
IN THE COURT OF APPEALS
Register v. Sledge, Michigan Court of Appeals. In this case in which Plaintiff claimed closed head injury, neck and back problems, and seizures arising out of a rear end collision, the Court of Appeals affirmed the trial court’s grant of summary disposition. Although the plaintiff had submitted three affidavits of treating physicians, each concluding that she suffered from a serious neurological injury or serious impairment, the Court found that the affidavits were conclusory and not supported by the records. In doing so, the Court affirmed the importance of looking beyond the conclusory statements within an affidavit, and noted that a court must conduct a careful review of the facts underlying those opinions before relying upon them. Additionally, the Court held that the plaintiff had failed to provide sufficient evidence to support any claim that her general ability to lead a normal life had been materially altered. The Court therefore concluded that summary disposition was merited under Kreiner.
MICHAEL F. SCHMIDT WINS “DISTRACTED CUSTOMER” INJURY CASE
IN COURT OF APPEALS
Miller v Bass Pro Shop, Court of Appeals affirmed our summary disposition. The plaintiff tripped and fell over the base of a display sign at the Bass Pro Shop. She claimed that she was distracted by taxidermy mounts displayed by the store. The plaintiff argued that there should be a “distracted customer” exception to the open and obvious defense. The Court of Appeals affirmed our summary disposition and ruled that there is no “distracted customer” exception to the open and obvious defense, that the only exception is the “special aspects analysis” and that the plaintiff’s claim did not meet this analysis and thus was rejected by the court. The court further held that despite the huge debate that exists in the jurisprudence of the state over what constitutes open and obvious and the subtleties that the Supreme Court defines as fitting within that rule, “this case appears to be at the opposite end of the spectrum.”
ABSOLUTE INTOXICATION STATUTE VICTORY
RECORDED BY BARRY SUTTON
Krause v. Wadle, Oakland County, Michigan. In this social host case, the plaintiff, a minor and former model, suffered serious internal injuries which required numerous surgeries and left extensive scarring. The plaintiff sought to hold the individuals liable for supplying alcohol to her on a claim that their actions produced her intoxication and subsequent automobile accident. Her demand was $250,000. We filed a motion for summary disposition on the basis that the claim was barred under the absolute intoxication statute. After briefing, the plaintiff agreed to relief requested, and an order granting the motion was entered.
BARRY SUTTON PREVAILS IN COVERAGE CASE INVOLVING AN EXCLUSION BARRING COVERAGE
WHEN A VEHICLE IS BEING USED TO TRANSPORT FOR A FEE
Rollin v. Nationwide Mutual Fire Insurance Co., Wayne County, Michigan. In this insurance coverage dispute, the plaintiff suffered serious injuries while she was working within an ambulance while that vehicle was transporting a patient to the hospital. She sought uninsured motorist benefits. The trial court granted summary disposition in favor of our client under the exclusion which barred coverage when a vehicle is being used to transport a person for a fee. The court reasoned that the patient was being transported to the hospital for a fee, and that the plain language of the exclusion applied.
HARVEY KRUSE PUBLISHES REPORT OF OVER 200 COURTROOM VICTORIES IN 2003-2005
During the past several years, Harvey Kruse has recorded 211 victories in courtroom battles that are cataloged in a comprehensive report issued last year. They include 26 appellate wins, 13 trial and arbitration successes, 139 motions for summary judgment or disposition in which we were victorious, and various other administrative and miscellaneous proceedings in which we prevailed. Click here for a complete copy of the report.
