Denise Gable v. Citizens Insurance Company of the Midwest

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
DENISE GABLE, UNPUBLISHED
April 2, 2019
Plaintiff-Appellant,
v No. 341757
Macomb Circuit Court
CITIZENS INSURANCE COMPANY OF THE LC No. 2016-001087-NF
MIDWEST,
Defendant-Appellee.
Before: SHAPIRO, P.J., and BECKERING and M. J. KELLY, JJ.
PER CURIAM.
In this dispute about entitlement to first-party personal injury protection (PIP) benefits,
plaintiff Denise Gable appeals as of right the trial court’s order granting the motion for summary
disposition filed by defendant Citizens Insurance Company of the Midwest (“Citizens”). The
trial court granted the motion pursuant to MCR 2.116(C)(10) (no genuine issue of material fact,
movant entitled to judgment as a matter of law), finding no genuine issue of material fact that the
fraud exclusion provision in plaintiff’s insurance policy barred her complaint for first-person
personal injury protection (PIP) benefits. For the reasons stated below, we reverse the trial
court’s summary disposition order and remand the matter to the court for further proceedings.
I. BASIC FACTS AND PROCEDURAL HISTORY
On February 13, 2014, plaintiff was stopped for traffic behind another vehicle when her
car was rear-ended by a pickup truck with sufficient force to push her into the car in front of her.
Plaintiff went to the emergency room at Henry Ford Macomb Hospital complaining of a left
temporal headache due to hitting her head on the steering wheel, pain in her anterior chest wall
from the seatbelt, pain in her entire spine, pain in her knees from striking the dashboard, and pain
in her right shoulder. She received pain medication and was discharged. In subsequent days,
plaintiff addressed the pain in her back and her right shoulder and arm with her chiropractor, her
primary care physician, and, finally, with an orthopedic surgeon, James Kehoe, IV, D.O. Dr.
Kehoe reported that plaintiff had “fairly significant pain with difficulty raising her arm over her
head and weakness with external rotation,” surmised that she appeared to have a shoulder strain,
and put her in physical therapy.
On May 14, 2014, a physical therapist was manipulating plaintiff’s neck and shoulder
area when plaintiff started having trouble breathing and became lightheaded. As plaintiff was
driving home, she “got like a gray flash[,]” felt “woozy” again, and experienced blurred vision
out of her left eye. When matters did not improve, she went to Mt. Clemens Regional Medical
Center, where she complained of a sharp headache unlike any she had ever had, an increase in
pressure behind her left eye, and difficulty in focusing with her left eye. The following day,
plaintiff visited ophthalmologist, Dr. Robert J. Franchi, D.O., who reported in a May 22, 2014
letter to plaintiff’s primary care physician (PCP) that plaintiff suffered acute unilateral vision
loss in her left eye, with photophobia, i.e., light sensitivity, and that he suspected ischemic optic
neuropathy (ION).
Thereafter, plaintiff was referred to several specialists to determine the cause and
treatment of her condition. In July 2014, plaintiff saw neurologist Julie A. Burnham, D.O., who
reported to Dr. Franchi and plaintiff’s PCP her opinion that plaintiff had experienced ION to the
front (anterior) of the optic nerve (AION). The following month, plaintiff returned to Dr.
Burnham reporting pain on the left side of her face that increased with exposure to bright light.
Dr. Burnham surmised that plaintiff was suffering with “left neuritic facial pain associated with
the left AION.” Dr. Burnham prescribed something for plaintiff’s facial pain and recommended
a follow-up visit in two months, or sooner if necessary. When this medication produced
intolerable side effects, plaintiff and Dr. Burnham talked about other treatment options, including
the possibility of gamma knife stereotactic radiosurgery (GK SRS).
In late 2014, plaintiff began treating with neuro-ophthalmologist Daniel J. Lin, M.D. Dr.
Lin who wrote in a December 2014 letter to Hanover P.P. Unit Insurance, the insurer of the
vehicle that had rear-ended plaintiff’s car, that plaintiff may have experienced ION resulting
from manipulation during treatment for injuries she suffered in her car accident. Several weeks
later, on January 21, 2015, Dr. Lin reported to Hanover that plaintiff continued to have problems
with her left eye and facial pain, complained of sensitivity to light, and that optic atrophy
provided evidence of visual loss. He surmised that “[i]f this is traumatic optic neuropathy
[TON],” plaintiff’s visual loss will likely remain.
In March 2015, Dr. Lin wrote to plaintiff’s attorney stating that plaintiff’s vision problem
“started after her accident and seems reasonably associated with the trauma from her accident.”
In May 2015, plaintiff was referred to Michigan Head & Spine Institute (MHSI), where she saw
Omar Qahwash, D.O., to discuss treatment of her face pain. Dr. Qahwash ordered a number of
tests, none of which produced remarkable results, and discussed various treatment options for
plaintiff’s face pain, but without recommending any of them at the time.
On December 16, 2015, Dr. Lin wrote a letter to Hanover in which he stated that
plaintiff’s “visual loss in the left eye is likely due to a mild traumatic optic neuropathy on the
left.” Thus, the record indicates that by the end of 2015, plaintiff was still experiencing vision
problems in her left eye and associated pain on the left side of her face. With the exception of
one medication that produced intolerable side effects, none of the medications prescribed by her
doctors provided plaintiff with relief.
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On April 1, 2016, plaintiff filed a complaint seeking no-fault PIP benefits arising out of
the February 13, 2014 accident. In its answer to plaintiff’s complaint, defendant denied that
plaintiff was entitled to PIP benefits, asserting that her condition did not arise out of the
ownership, maintenance, or use of a motor vehicle as a motor vehicle and that her actions during
the pendency of her claims breached her obligations under the policy.
In August 2016, Dr. Lin referred plaintiff to the Kresge Eye Institute, where Dr. Robert
Tomsak reported that plaintiff was suffering from “functional visual loss,” but indicated that
there were no signs of traumatic optic atrophy, and opined that plaintiff’s condition might be
stress induced. Around the same time, plaintiff underwent the first of three insurance medical
examinations (IME). These examinations stretched into January 2017. Her examiners were a
neuro-ophthalmologist and two orthopedic surgeons. None of them concluded that plaintiff
needed more chiropractic treatment, that she was disabled or incapable of returning to her
previous level of work, or that she needed attendant or household services. The ophthalmologist
surmised that plaintiff was not being truthful about the vision capabilities of her left eye, and that
whatever eye issues she had likely resulted from autoimmune issues, not from her traffic
accident. One of the orthopedic surgeons found the treatments and diagnostic studies performed
for plaintiff reasonable, “based upon her symptomatic complaints,” but did not think she needed
additional treatment or diagnostic workups, and surmised that chiropractic treatments were the
source of plaintiff’s ongoing problems rather than anything directly related to the traffic accident.
In March 2017, Dr. Jeffry Jacobs, a neurologist at MHSI, referred plaintiff to Inga A.
Grills, M.D., a radiation oncologist, for information regarding GK SRS. According to the
doctor’s notes, plaintiff reported that Dr. Qahwash had recommended GK SRS a few years
earlier, but the “Gamma Knife ‘freaked her out’ and she did not follow up any further.” Dr.
Grills noted that plaintiff’s left-side face pain could represent atypical trigeminal neuralgia,
started plaintiff on a trial of carbamazepine, and opined that, in light of the severity of plaintiff’s
symptoms, GK SRS could be considered, although it might be potentially less effective in the
setting of atypical trigeminal neuralgia. After discussing the logistics and potential side effects
of GK SRS, plaintiff and Dr. Grills agreed that if the new medication did not produce significant
relief in a month, they would proceed with surgery. Plaintiff did in fact undergo GK SRS on
May 2, 2017.
Plaintiff resumed physical therapy sometime in 2017. On August 9, 2017, plaintiff
revisited Dr. Kehoe for a checkup of her right shoulder. Dr. Kehoe observed positive
impingement signs, ordered an “MR evaluation” of plaintiff’s right shoulder, and recommended
that any surgery be entered into “with trepidation given her history and not really knowing what
neurologically is going on with her.” At an August 16, 2017 follow-up visit to discuss the results
of the MRI, Dr. Kehoe noted significant changes from plaintiff’s previous MRI and discussed
arthroscopic evaluation of her shoulder and surgical responses to specific findings. Plaintiff
elected to go ahead with surgery.1
1
Plaintiff underwent surgery to repair her rotator cuff on September 26, 2017.
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Also in August 2017, defendant filed a motion for summary disposition pursuant to MCR
2.116(C)(10). The gravamen of defendant’s argument was that plaintiff had misrepresented her
condition to defendant and to her doctors. Defendant asserted that no medical professionals had
provided a medical explanation for plaintiff’s ongoing complaints, and none could relate the
treatments she had received to the February 13, 2014 car accident. Defendant further asserted
that plaintiff had Sjogren’s syndrome, a condition that produces symptoms identical to those
suffered by plaintiff and which she had failed to reveal to several of her doctors. Finally,
defendant asserted that surveillance video from July 2, 2017, showing plaintiff waxing her car in
the bright sunshine, without wearing sunglasses, belied plaintiff’s claims of “extreme sensitivity
to light and significant right arm/should pain,” and further illustrated her material
misrepresentations to defendant. Because there was no genuine issue of material fact that
plaintiff committed fraud, defendant argued, the trial court should dismiss plaintiff’s claim as a
matter of law.2
In response, plaintiff denied that her symptoms were related to Sjogren’s syndrome and
that she had misrepresented her condition to her healthcare providers or to defendant. She
denied that the video illustrated that she had misrepresented her condition, arguing that she was
under no restrictions that prevented her from waxing her car, and that she had not presented any
claims to defendant for replacement services with respect to waxing her car. She also noted that
three of her physicians had opined that her traffic accident had proximately caused her anxiety
and depression, left lobe neuropathy, and visual difficulties.
Subsequent to the September 5, 2017 hearing on defendant’s pending motion, the trial
court issued a detailed written opinion in which it pointed to Dr. Burnham’s diagnosis of AION
and found equivocal Dr. Lin’s testimony about subsequent potential diagnosis of TON, and ruled
as follows:
Viewing the evidence in the light most favorable to [plaintiff], reasonable minds
could conclude only that Gable consistently misrepresented her eye diagnosis as
traumatic in nature, stemming from the motor vehicle accident at issue. Here,
[defendant] presented documentary evidence that [plaintiff’s] treating physicians
did not conclude that she suffered a traumatic optic neuropathy because objective
testing could not confirm that diagnosis. Further, the evidence presented
demonstrates that Dr. Qahwash rejected gamma-knife treatment instead of
recommending it to [plaintiff], as she represented. And the surveillance report
belies plaintiff’s assertion that she was unable to work in sunlight. In short,
[plaintiff] failed to present documentary evidence creating a dispute as to these
material facts demonstrating that she made knowing or reckless false statements
in order to procure medical treatment at [defendant’s] expense.”
2
Defendant argued alternatively for partial summary disposition on the ground that there was no
genuine issue of material fact as to whether plaintiff’s optical treatments are genuine and related
to the motor vehicle accident. The trial court did not address this argument.
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With regard to defendant’s claim that plaintiff committed fraud by not revealing a pre-existing
diagnosis of Sjogren’s syndrome, the trial court ruled, “there are genuine issues of material fact
as to whether plaintiff actually had Sjogren’s syndrome, and reasonable minds could differ as to
whether plaintiff’s failure to disclose the condition was a misrepresentation.” After the trial
court denied plaintiff’s motion for reconsideration, this appeal followed.
II. ANALYSIS
Plaintiff contends that the trial court erred by impermissibly assessing the credibility of
the evidence in making its summary disposition decision. We agree.
This Court reviews de novo motions for summary disposition under MCR 2.116(C)(10).
Shelton v Auto-Owners Ins Co, 318 Mich. App. 648, 657; 899 NW2d 744 (2017). The Court
views the affidavits, pleadings, depositions, admissions, and other documentary evidence in the
light most favorable to the nonmoving party, and draws all reasonable inferences in favor of the
nonmovant. Id. Summary disposition is properly granted where, [e]xcept to the amount of
damages, there is no genuine issue as to any material fact, and the moving party is entitled to
judgment as a matter of law.” MCR 2.116(C)(10). “A genuine issue of material fact exists when
the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue
upon which reasonable minds might differ.” West v Gen Motors Corp, 469 Mich. 177, 183; 665
NW2d 468 (2003). When deciding a motion for summary disposition, a court may not make
findings of fact or weigh credibility. Skinner v Square D Co, 445 Mich. 153, 161; 516 NW2d
475 (1994); Amerisure Ins Co v Plumb, 282 Mich. App. 417, 431; 766 NW2d 878 (2009).
When an insurance company relies on a policy’s exclusionary clause as an affirmative
defense against the policyholder’s lawsuit, the insurance company has the burden to prove that
the exclusion applies. Shelton, 318 Mich. App. at 657; Auto Owners Ins Co v Seils, 310 Mich
App 132, 146; 871 NW2d 530 (2015). The provision in plaintiff’s policy upon which defendant
relies states:
We do not provide coverage for any ‘insured’ who has made fraudulent
statements or engaged in fraudulent conduct in connection with any accident or
loss for which coverage is sought under this policy.
In order to prove the applicability of this fraud exclusion applies, defendant must show:
that (1) the misrepresentation was material, (2) that it was false, (3) that the
insured knew that it was false at the time it was made or that it was made
recklessly, without any knowledge of its truth, and (4) that the insured made the
material misrepresentation with the intention that the insurer would act upon it.
[Mina v. Gen. Star Indemnity Co., 218 Mich. App. 678, 686; 555 NW2d 1 (1996),
rev’d in part on other grounds 455 Mich. 866 (1997).]
A statement is material if it is reasonably relevant to the insurer’s investigation of a
claim. Id. “[F]raud . . . is not to be lightly presumed, but must be clearly proved by clear,
satisfactory and convincing evidence[.]” Cooper v Auto Club Ins Ass’n, 481 Mich. 399, 414; 751
NW2d 443 (2008) (quotation marks and citations omitted). “Generally, whether an insured has
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committed fraud is a question of fact for a jury to determine.” Meemic Ins Co v Fortson, 324
Mich. App. 467, 473; __ NW2d __ (2018). “However, under some circumstances, a trial court
may decide as a matter of law that an individual committed fraud.” Id., citing Bahri v IDS Prop
Cas Ins Co, 308 Mich. App. 420, 425-426; 864 NW2d 609 (2014). Nevertheless, summary
disposition is inappropriate when questions of motive, intention, credibility, or other conditions
of mind are material issues. Wurtz v Beecher Metro-Dist, 298 Mich. App. 75, 90; 825 NW2d 651
(2012), rev’d on other grounds 495 Mich. 242 (2014); Pemberton v Dharmani, 207 Mich. App.
522, 529 n 1; 525 NW2d 497 (1994).
On appeal, defendant largely abandons the argument it set forth in the trial court that
plaintiff’s failure to inform some of her healthcare providers of an alleged pre-existing condition
of Sjogren’s syndrome constituted fraudulent representations. Instead, defendant adopts the trial
court’s implicit reasoning that plaintiff misrepresented her condition to defendant when she
claimed that her vision problems resulted from traumatic optic neuropathy arising from her car
accident, and continues to maintain that surveillance video belies plaintiff’s claim of an accident-
related shoulder injury. Defendant contends that the present case is similar to Bahri, 308 Mich
App 420 (2014), and calls for the same outcome, i.e., affirmation of the trial court’s grant of
summary disposition based on fraud.
Bahri involved a plaintiff seeking PIP benefits from a defendant insurer who declined to
pay for the plaintiff’s replacement services. Bahri, 308 Mich. App. at 422. Because the plaintiff
had requested replacement services for a period before the traffic accident occurred, as well as
for tasks video surveillance showed the plaintiff performing, the insurer moved for summary
disposition pursuant to MCR 2.116(C)(10), arguing that the fraud exclusion in the plaintiff’s
policy barred her claim. Id. The trial court granted the defendant’s motion for summary
disposition, and the plaintiff appealed in this Court. This Court affirmed the trial court’s
decision. In the process, the Court observed that the plaintiff’s claim for replacement services
rendered before the accident, and for dates on which surveillance showed her performing tasks
for which she made replacement claims, “belie[d] plaintiff’s assertion that she required
replacement services, and it directly and specifically contradict[ed] representations made in the
replacement services statements.” Id. at 426. Thus, “[r]easonable minds could not differ in light
of this clear evidence that plaintiff made fraudulent representations for purposes of recovering
PIP benefits.” Id. Defendant argues that, as in Bahri, the plaintiff in the present case “made
fraudulent representations in the furtherance of her claim[,]” and, therefore, that the fraud
exclusion provision in defendant’s insurance policy bars her claim.
Notwithstanding defendant’s assertion, we find the case at bar distinguishable from
Bahri. No medical or legal judgment was required of the plaintiff in Bahri to recognize that
submitting statements to her insurer for replacement services before her traffic accident was
untruthful. The same holds true for the Bahri plaintiff’s request for payment for replacement
services for tasks that she actually and repeatedly performed. This Court concluded, “such
repeated activities are sufficient to establish the elements of fraud beyond a question of fact.”
Shelton, 318 Mich. App. at 660; see also Bahri, 308 Mich. App. at 426. The evidence of fraud
offered in the case at bar, however, is not as “clear, satisfactory and convincing” as that seen in
Bahri. Cooper, 481 Mich. at 414.
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Although defendant and the trial court pointed to medical records of various doctors who
surmised that plaintiff’s vision problems resulted from ischemic optic neuropathy, the record
also contains potential diagnoses of traumatic optic neuropathy. As previously indicated, Dr. Lin
stated in a December 2015 letter to Hanover Insurance that “plaintiff’s “visual loss in the left eye
is likely due to a mild traumatic optic neuropathy on the left[.]” The trial court found Dr. Lin’s
deposition testimony “equivocal,” but by so doing, the court arguably made an improper finding
of fact or credibility assessment. See Skinner, 445 Mich. at 161. Dr. Tomsak suspected ischemic
optic neuropathy, but the record evidence shows that he also listed “traumatic optic neuropathy”
as a second assessment. In addition, the record shows differing opinions about the origin of
whatever condition caused plaintiff’s vision issues. Dr. Franchi suspected ischemic optic
neuropathy, but opined that plaintiff’s car accident proximately caused the condition, Matthew
Prior, D.O., whom plaintiff visited in August 2016, and Dr. Tomsak suggested that her
symptoms were stress-related, and Dr. Lin stated at different times that her vision problems
resulted from manipulation at physical therapy, from ION, or from TON. As late as August
2017, Dr. Kehoe indicated the absence of a definitive diagnosis of plaintiff’s neurological issues.
In light of the foregoing, to conclude that plaintiff made material representations
knowingly or recklessly with the intent that defendant rely on them requires either ignoring some
of the record evidence, finding some evidence more credible than other evidence, or viewing the
evidence in the light most favorable to the movant, rather than the nonmovant. All of which is
prohibited when deciding a motion for summary disposition. See Shelton, 318 Mich. App. at 657;
Amerisure Ins Co, 282 Mich. App. at 431. In addition, to the extent that the trial court impliedly
determined that plaintiff could not believe in good faith that she was entitled to PIP benefits,
given the opinions of various doctors that her condition was attributable to ION rather than TON,
this was a determination inappropriate for summary disposition. See Wurtz, 298 Mich. App. at
90; Pemberton, 207 Mich. App. at 529 n 1.
Defendant points to several specific examples of alleged misrepresentation from
plaintiff’s deposition. Defendant contends that plaintiff misrepresented her condition when, at
her second deposition, she “testified that she was diagnosed with “TON – traumatic optic
neuropathy.” Upon review of the deposition transcript, we note that plaintiff does testify that her
doctors diagnosed her with TON, but she also said that doctors provided an alternative diagnosis,
and agreed that it could be ION. Asked whether “any doctor [told her] that it wasn’t due to
trauma or that it was not likely that it was due to trauma[,]” plaintiff replied, “No, both of them
[referring to Drs. Franchi and Lin] said it was from the car accident.” As indicated above, there
is record evidence to support plaintiff’s testimony, specifically with regard to Dr. Lin.
Defendant also contends that the video surveillance of plaintiff establishes that she
misrepresented her condition to defendant with claims of “extreme sensitivity to light and
significant right arm/shoulder pain.” The premise of defendant’s assertion is that plaintiff has
said that she is, in the words of defendant, “unable to work in sunlight.” Plaintiff denies making
this statement, and at her 2017 deposition, she provided testimony regarding her sensitivity to
light that was more nuanced than defendant’s premise would suggest. Plaintiff said that she was
looking for a job “that doesn’t have light” or that did not “involve computers of bright lights.”
However, she also indicated that some types of computer screens emit a light that is more
bothersome to her eye than do others, and her testimony suggested that she could tolerate direct
sunlight without pain for short periods. Moreover, nothing in the record indicates that she is
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under doctor’s orders to always wear sunglasses when outside. Five minutes of video
surveillance showing plaintiff in the sunlight with her sunglasses on top of her head, at hand
should she need them, is not necessarily inconsistent with her deposition testimony, nor does it
provide “clear, satisfactory, and convincing evidence” of fraud. Cooper, 481 Mich. at 414.
Similarly, we do not believe that the five-minute clip from the surveillance video presents “clear,
satisfactory, and convincing evidence” of fraud with regard to plaintiff’s claims of shoulder and
arm pain resulting from the car accident. Just because plaintiff could wax a single spot on the
door of her vehicle for five-minutes, alternating hands every few seconds, does not show that she
could perform tasks requiring her to lift and carry, nor does it conclusively prove intent to
defraud. See Shelton, 318 Mich. App. at 660 (indicating that a plaintiff’s modest engagement in
activities that the plaintiff asserts is painful is not “sufficient to establish any of the elements of
fraud beyond a question of fact”).
Viewing the record in the light most favorable to plaintiff, the nonmovant, this Court
concludes that defendant failed to establish that plaintiff made material representations that were
false, knowingly or recklessly, and intending for defendant to rely on them. It may turn out that
plaintiff is not entitled to PIP benefits for some other reason. However, fraud “is not to be lightly
presumed,” and defendant did not provide “clear, satisfactory, and convincing evidence” that
plaintiff violated the fraud provision in her policy. See Cooper, 481 Mich. at 414.
We reverse the trial court’s order granting summary disposition to defendant and remand
the matter to the trial court for further proceedings. We do not retain jurisdiction.
/s/ Douglas B. Shapiro
/s/ Jane M. Beckering
/s/ Michael J. Kelly
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