Kalvin Candler v. Farm Bureau Mutual Insurance Company of Michigan

STATE OF MICHIGAN
COURT OF APPEALS
KALVIN CANDLER, FOR PUBLICATION
October 24, 2017
Plaintiff-Appellee,
and
PAIN CENTER USA, PLLC,
Intervening Plaintiff,
v No. 332998
Wayne Circuit Court
FARM BUREAU MUTUAL INSURANCE LC No. 15-011245-NF
COMPANY OF AMERICA,
Defendant-Appellant.
Before: SAAD, P.J., and CAVANAGH and CAMERON, JJ.
CAMERON, J., (dissenting)
Under MCL 500.3173a(2) of the Michigan no-fault act, a person who knowingly presents
or causes to be presented a false statement that is part of or in support of a claim to the Michigan
automobile insurance placement facility (Facility) is ineligible for payment and barred from
receiving benefits under the assigned claims plan. This case raises the issue of whether a false
statement made not to the Facility, but instead to one of its servicing insurers, similarly serves as
a bar from personal protection insurance (PIP) benefits. Because I disagree with the majority’s
construction of the statute, I respectfully dissent.
When construing a statute, we are required to “discern and give effect to the intent of the
Legislature,” and in determining legislative intent, “this Court must first look to the language of
the statute.” Bush v Shabahang, 484 Mich 156, 166-167; 772 NW2d 272 (2009). “Plain and
unambiguous language in a statute must be enforced as written, and a forced construction or
implication will not be upheld.” Vulic v Dep’t of Treasury, ___ Mich App ___, ____; ___ NW2d
___ (2017) (Docket No. 333255); slip op at 2. “As far as possible, effect should be given to
every phrase, clause, and word in the statute.” Shabahang, 484 Mich at 167 (citation omitted).
Furthermore, this Court must read the statute as a whole, and while individual words and phrases
are important, they “should be read in context of the entire legislative scheme.” Id.-1-
MCL 500.3173a states:
(1) The Michigan automobile insurance placement facility shall make an initial
determination of a claimant’s eligibility for benefits under the assigned claims
plan and shall deny an obviously ineligible claim. The claimant shall be notified
promptly in writing of the denial and the reasons for the denial.
(2) A person who presents or causes to be presented an oral or written statement,
including computer-generated information, as part of or in support of a claim to
the Michigan automobile insurance placement facility for payment or another
benefit knowing that the statement contains false information concerning a fact or
thing material to the claim commits a fraudulent insurance act under [MCL
500.4503] that is subject to the penalties imposed under [MCL 500.4511]. A
claim that contains or is supported by a fraudulent insurance act as described in
this subsection is ineligible for payment or benefits under the assigned claims
plan. [MCL 500.3173a(1) and (2).]
The dispute over legislative intent arises from whether fraudulent statements in
connection with a claim for PIP benefits must be presented to the Facility for ineligibility under
MCL 500.3173a(2) to apply. The majority construes the statute to require the withholding of
benefits whenever a false statement is presented to a servicing insurer simply because an initial
(albeit non-fraudulent) claim was presented to the Facility. Under the majority’s reading of the
statute, plaintiff is barred from receiving any benefits because he presented a false statement in
support of a claim for no-fault benefits to Farm Bureau, a servicing insurer. The majority
reaches its result by construing the phrase “to the Facility” to modify only the word “claim.”
Thus, through statutory interpretation, the majority finds false statements in support of a claim do
not have to be presented to the Facility. I disagree.
The plain language of MCL 500.3173a(2) reflects the Legislature’s intent that false
statements made as part of or in support of a claim must be presented to the Facility before a
person may be found ineligible for PIP benefits. A person is ineligible for payment or benefits
under the assigned claims plan when one “presents or causes to be presented an oral or written
statement . . . as part of or in support of a claim to [the Facility] for payment.” Contrary to the
majority opinion, “as part of or in support of” is a conjunctive phrase reflecting the Legislature’s
intent that false statements have a specific relationship to a claim presented to the Facility before
exclusion under MCL 500.3173a(2) is triggered. The Legislature could have made false
statements to assigned member insurers, like Farm Bureau, a basis for denial of benefits and
eligibility but has not yet done so.1 A statute must be enforced as written, and we should not rely
1
See 2015 HB 4224 as passed by the Senate on June 9, 2016, in which our legislature sought to
amend MCL 500.3173a(2) to address this very issue:
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on a forced construction of the statute to obtain a particular outcome. Vulic, ___ Mich App at
___; slip op at 2.
In the majority’s view, only a prior claim for benefits presented to the Facility is required
for a subsequent false statement to qualify under MCL 500.3173(a)(2). In an effort to provide
clarity, the majority sets forth the elements that a complaining party must show before MCL
500.3173a(2) is applicable. A person commits a fraudulent insurance act when he or she “(1)
presents or causes to be presented an oral or written statement, (2) which is part of or in support
of a claim for no-fault benefits, (3) where the claim for benefits was submitted to the [Facility] . .
., (4) the person must have known that the statement contained false information, and (5) the
statement concerned a fact or thing material of the claim.” (Emphasis added.) But the third
requirement, that a claim for benefits “was submitted” to the Facility, is not found in the statute.
The majority enhances the statutory language by adding a component: that as long as a prior
claim was made to the Facility, any new claim supported by a false statement is barred regardless
of where the claim is presented. However, every person who is assigned an insurer under the
assigned claims plan made an initial claim to the Facility because it is the Facility that first
receives a claim for eligibility and, if approved, assigns the person to a servicing insurer.
Recognizing a new condition that a claim “was submitted” to the Facility, therefore, is
superfluous and, more importantly, not found in the plain language of the statute.
A provision more consistent with the majority’s reading of the statute would recite “a
person who presents or causes to be presented an oral or written statement or a claim to the
Michigan automobile insurance placement facility for payment or benefits knowing that the
statement or claim contains false information is subject to the penalties imposed under section
4511.” Here the recipient of a false statement is irrelevant, as argued by the majority. This is not
the language the Legislature adopted, however. We simply should not read into a statute
something that is not there.
I likewise disagree with the majority that a claim made to a servicing insurer is the same
as a claim presented to the Facility. The no-fault act recognizes the Facility as a distinct entity
from the participating insurers. Under MCL 500.3171(9)(a), the Facility is an entity created
under chapter 33, MCL 500.3301, et al., and Chapter 33 defines the “Facility” as the
“automobile insurance placement facility created pursuant to this chapter,” MCL 500.3303(c).
However, a “Participating Member” is specifically defined as “an insurer who is required by this
chapter to be a member of the facility,” MCL 500.3303(d). By the language of these statutes, a
A person who presents or causes to be presented an oral or written statement . . .
in support of a claim to the [Facility] or to an insurer assigned a claim by the
Michigan Automobile Placement Facility for payment or another benefit
knowing that the statement contains false information concerning a fact or thing
material to the claim commits a fraudulent insurance act . . . . A claim that
contains or is supported by a fraudulent insurance act as described in this
subsection is ineligible for payment or of any benefits under the assigned claims
plan.
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participating member is a separate entity from the Facility, and to conclude that the Legislature
only included the Facility in MCL 500.3173a, but nonetheless intended to mean both the Facility
and its participating members, goes beyond the plain language of the statute and disregards the
terms’ distinctions under Chapters 31 and 33.
It is unnecessary to make a strained construction of the statute. The Legislature has
already provided different language to exclude persons who make false statements made as part
of or in support of a claim to a servicing insurer. MCL 500.3173a(2) denies PIP benefits to a
person who “presents or causes to be presented” a false statement as part of or in support of a
claim to the Facility for payment. (Emphasis added.) When a servicing insurer receives a false
statement related to a claim and then seeks reimbursement of that claim from the Facility, then
the person making the claim has caused to be presented a false statement in support of a claim to
the Facility. If plaintiff’s false statement in support of his claim was presented to the Facility by
Farm Bureau, plaintiff is ineligible for benefits under the statute. 2
In this case, however, the record reflects that Farm Bureau identified the falsity of the
statements and did not seek reimbursement from the Facility in connection with plaintiff’s claim
for attendant care and replacement services. Therefore, a false statement was not presented or
caused to be presented to the Facility, and I respectfully dissent.
/s/ Thomas C. Cameron
2
In other contexts, the language “caused to be presented” has been given broad application. See
MCL 400.601 et seq. and Sec 31 USC 3730 et seq.
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