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Facts – In this case, Plaintiff, a lessee, fractured his ankle during a fall when he was walking on 1-2 inches of accumulated snow in the parking lot of his apartment complex. Plaintiff filed suit alleging negligence and breach of a covenant to maintain and repair the premises, MCL 554.139(1). The Trial Court granted Defendant’s Motion for Summary Disposition concluding that the danger was "open and obvious". The Court of Appeals affirmed. Then, upon Plaintiff’s Motion for Reconsideration, it vacated its initial opinion. Review was sought from the Michigan Supreme Court.

On appeal, the question was (1) whether parking lots in leased residential areas constitute "common areas" under MCL 554.139(1)(a); (2) whether the natural accumulation of snow and ice is subject to the lessor’s duty set forth in MCL 554.139(1)(a), and (3) whether the natural accumulation of snow and ice is subject to the lessor’s duty set forth in MCL 554.139(1)(b). The Court noted that MCL 554.139 provides specific protection to lessee’s and licensees of residential property in addition to any protection provided by common law. MCL 554.139 states:

(1) in every lease or license of residential premises, the lessor or licensor covenants: (a) That the premises and all common areas are fit for the use intended by the parties. (b) To keep the premises in reasonable repair during the term of the lease or license, and to comply with the applicable health and safety laws of the State and of the local unit of government where the premises are located, except when the disrepair or violation of the applicable health or safety laws has been caused by the tenant’s willful or irresponsible conduct or lack of conduct.

 

The Court noted the statute did not define the term "common areas". The Court held in the context of leased residential property, "common areas" describes the areas of the property over which the lessor retains control and is shared by two or more tenants. The Court then went on to determine that a parking lot within a leased residential property fits within the meaning of "common area" because it is accessed by two or more tenants and the lessor retains general control. Given the foregoing, a lessor has a contractual duty to keep the parking lot "fit for the use intended by the parties". The issue was whether that covenant encompasses the duty to keep the lot free from the natural accumulation of snow and ice. The Court reasoned that a parking lot is generally considered suitable for the parking of vehicles as long as the tenants are able to park their vehicles and have reasonable access to them. In the case at bar, there was no other language within the lease other than there was basic parking and reasonable access to said parking. According to Plaintiff’s allegation, the lot was covered with 1-2 inches of snow and Plaintiff fell as a result. The Court held that there could be no reasonable differences of opinion regarding the fact that tenants were able to enter and exit the parking lot, to park their vehicles and to access those vehicles. With regard to the accumulation of snow and ice in a parking lot, it would be triggered only under much more exigent circumstances than those in this case. The statute does not require a lessor to maintain a lot in an ideal condition or in the most accessible condition possible, but merely requires a lessor to maintain it in a condition that renders it fit for use as parking lot.

The final question was whether a lessor’s duty to repair under MCL 554.139(1)(b) extends to snow and ice accumulated in a parking lot. The Court first addressed the differences between subsection ("a") and subsection ("b") wherein subsection ("a") applies to "the premises and all common areas" while subsection ("b") applied only to "the premises". "Premises" does not encompass "common areas" and that the covenant to repair under subsection ("b") does not apply to "common areas" and relies upon a dictionary terminology. Damage to the property would constitute an imperfection of the property that would require mending. Repairing a defect equates to keeping the premises in a good condition as a result of restoring and mending damage to the property. The Court held that the accumulation of snow and ice does not constitute a defect in the property and, therefore, the lessor has no duty under MCL 554.139(1)(b) in regard to snow and ice, except to the extent that snow and ice caused damage to the property. Therefore, the lessor’s duty to repair under MCL 554.139(1)(b) does not apply to common areas and therefore does not apply to parking lots. Allison v AEW Capital Management, L.L.P., 481 Mich 419.

Recommendation – When presented with a slip and fall in parking lot involving a lessor/lessee relationship, MCL 554.139(1)(b) is not applicable and MCL 554.139(1)(a) may be applicable depending upon the facts of whether the snow/ice condition still allows the parking lot to be used for its intended purpose, i.e. parking and access to the parked vehicle.

Facts – In this case, Krohn was involved in a motor vehicle accident in 1981. She sustained injuries including a brain injury. Given the foregoing, State Farm Insurance Company paid personal protection insurance benefits. In 1991, Plaintiffs first became aware that Krohn had a high cholesterol problem which was treated through exercise and restricted diet. Plaintiff’s treating physician prescribed cholesterol medication in 1997. In September 1997, the treating physician wrote the State Farm adjuster, opining the hyperlipidemia was directly related to the auto accident. The doctor noted that Krohn was not able to do as much exercise as she should, and she had an impairment of self control due to her head injury which made it hard for her to eat a reasonable diet. In May of 2003, another physician indicated Krohn was having significant problems with her right leg and that she stopped exercising due to the fact she was concerned it would make the problem worse. This physician also opined that her cholesterol problem was causally related to the auto accident. Early on, Krohn was prescribed Zocor and then Zetia was added around December of 2003. In around 2004, she was prescribed Vytorin. State Farm refused to pay for Zetia or Vytorin contending that it was not related to the 1981 motor vehicle accident. Plaintiffs then filed suit. Defendants moved for Summary Disposition which was denied by the Probate Court. Leave to Appeal was filed with the Circuit Court which was denied. Leave was then sought with the Court of Appeals.

The issue was whether the cholesterol problem was "arising out of" injuries sustained in the 1981 MVA pursuant to MCL 500.3105(1). The Court noted that Plaintiffs responded to Defendant’s Motion by producing evidence of causal connection between the accident and the hyperlipidemia. The evidence was such that the accident caused brain and skeletal injuries which made it difficult for Plaintiff to exercise and, which contributed to poor judgment regarding diet. This difficulty in exercising and poor diet contributed to her hyperlipidemia. Therefore, Plaintiffs presented sufficient evidence to raise a genuine issue of material fact for the trier of fact to decide whether the high cholesterol problem was related to the accident. Scott v State Farm Mutual Automobile Insurance Company, 278 Mich App 578 (2008).

Recommendation – In this case the issue of whether high cholesterol and its associated symptomatology arose out of an accident was a question of fact to be determined by a trier of fact. In evaluating a claim when confronted with seemingly unrelated medical conditions it will be important to explore any causal relationships to the subject accident.

Facts – In this case, Plaintiff was a passenger in a truck driven by her husband when he lost control of the truck and side swiped a utility pole and tree causing injuries. The husband’s policy of insurance provided liability coverage limits of $300,000 per person/$500,000 per accident. However, the policy also contained the following provision:

"There is no coverage for [bodily injury] for which a covered person becomes legally responsible to pay a member of that covered person’s family residing in that covered person’s household. This exclusion applies only to the extent that the limits of liability for this coverage exceed $20,000 for each person or $40,000 for each accident."

Plaintiff filed suit against her husband and Defendant alleging breach of contract, fraud and negligent and innocent misrepresentation. She also sought declaratory relief concerning the limits of the policy. Following the filing of Motions for Summary Disposition by both Plaintiff and Defendant, the Trial Court found the challenged provision was unambiguous, and complied with the coverage required by the No-Fault Act. However, it ultimately refused to enforce the challenged provision because it was "repugnant", "reprehensible", and "unconscionable".

On appeal, the Court noted the challenged provision was unambiguous. The provision was susceptible to only one meaning. Claims by family members are excluded from coverage beyond the minimum limits of $20,000 per person/$40,000 per accident. The Court concluded the Trial Court improperly substituted its own policy choice and a Court may not merely impose its own personal public policy. Family members claims may be reduced to the statutory minimum coverage and therefore the provision is not void against public policy. Further, the contested provision was not unconscionable. Her husband was free to accept the policy terms or reject them and obtain insurance through another provider. Thus, there was no procedural unconscionability. In addition, there was no substantive unconscionability because the inequity of the term was not so extreme as to shock the conscious. The Court noted that an insured has an obligation to read the insurance policy issued and that the insured must raise any questions regarding the coverage of the insurance policy to the insurer within a reasonable time. Therefore Defendant had no obligation to notify Plaintiff unless the provision was added after the policy was initially purchased. Then it would become important whether Defendant actually provided notice of the reduction coverage to Plaintiff. Therefore, the Court of Appeals reversed and remanded for proceedings consistent with the foregoing. Ruzak v USAA Insurance Agency, Inc., Unpublished Per Curiam Opinion of the Court of Appeals, Decided June 24, 2008, Docket No. 274993.

Facts - Briefly, prior to the accident, Defendant was driving upon I-275 when he had to stop at a rest area due to a sudden urge to use the restroom "big time". Plaintiff testified that he had severe diarrhea and after using the restroom, he walked around the rest area to make sure he was finished. He then proceeded down the highway and while he was exiting the ramp, he "just broke out into a sweat and got dizzy". Defendant testified it was sudden and he observed the vehicle in front and began to apply his brakes but blacked out. After the impact, he exited his tractor trailer and blacked out again.

The Court of Appeals reversed the Trial Court’s granting the Motion for Summary Disposition based upon sudden emergency opining that the statutory presumption of negligence was a question of credibility relative to Defendant’s alleged sudden emergency and that it needed to be decided upon the jury, not by the Court as a matter of law. The Supreme Court agreed and concluded that there were genuine issues of material fact regarding Defendant’s claim of sudden emergency. The Supreme Court held that the question regarding whether Defendant experienced a sudden emergency and whether Defendant was negligent in driving under the facts presented were proper questions for the jury. White v Taylor Distributing Company, Inc., 428 Mich 136 (2008).

Recommendation – The applicability of the sudden emergency doctrine may be proper questions for the jury based upon the facts.

Facts – In this case, Kimberly Sterling was either pushed or jumped out of a moving motor vehicle, hitting the ground and sustaining serious brain injuries. Defendant originally refused to pay Plaintiff’s claim for no-fault benefits because it asserted that the injuries resulting from an assault are exempt from no-fault coverage. After her boyfriend was acquitted of assault, Defendant agreed to pay the claim with interest, but denied it owed attorney fees. The Trial Court ruled that the original denial was unreasonable because even if she was assaulted, the claim was not barred by the fact her injuries occurred when she fell out of a moving vehicle while the vehicle was being used for transportation. The Trial Court subsequently determined that the 25 percent contingency fee to which Plaintiff agreed was fair and granted Plaintiff attorney fees consistent with that agreement.

On Appeal, the Court noted that an attorney is entitled to a reasonable fee for advising and representing a Claimant in an action for personal injury or property protection insurance benefits pursuant to MCL 500.3148. An insurer’s delay in making payments under the no-fault act is not unreasonable if it is based upon a legitimate question of statutory destruction, constitutional law, or factual uncertainty. Whether the fees are warranted does not depend on whether coverage is ultimately determined to exist, but on whether the insurer’s initial refusal to pay was unreasonable. In its analysis, the Court noted that MCL 500.3105(1) no-fault personal protection insurance benefits are payable for "accidental bodily injury arising out of ownership, operation, maintenance or use of a motor vehicle as a motor vehicle". MCL 500.3105(4) provides that bodily injury "is accidental as to a person claiming personal protection insurance benefits unless suffered intentionally by the injured person or caused intentionally by the Claimant". In this case, Defendant never claimed that it initially denied benefits because Sterling intended to injure herself. Defendant claimed no-fault benefits were not payable for injuries arising from assaults. In its analysis, the Court noted her injuries were a direct result of the vehicle’s movement, not merely incidental. Even if there were an assault, her injuries were still a direct result of exiting a moving vehicle. The Court found that regardless of whether she was shoved or voluntarily exited the vehicle, there was no evidence she intended to hurt herself, and her injuries were directly related to the use of the vehicle as a mode of transportation. Defendant’s argument that it delayed paying the benefits because it believed the injuries resulted from an assault were inconsistent with the plain language of the no-fault statute and there was no case law supporting their position. Consequently, the Court found Defendant did not have a reasonable basis for denying Plaintiff’s PIP benefits under the Act.

Defendant next claimed that the Trial Court erred when it set a reasonable attorney fee based upon the contingent fee agreement between Plaintiff and its counsel which resulted in fees of over $1,600.00 per hour. The Court noted that the Trial Court employed a multi-factor analysis required by Wood v DAIIE, 413 Mich 573 (1982) and ultimately concluded that the contingent fee agreement between Plaintiff and its attorneys established "a reasonable attorney fee" pursuant to MCL 500.3148(1). The Court held that there was no error in the Trial Court’s reasoning that not awarding a contingent fee as a reasonable attorney fee would reward Defendant and punish Plaintiff for a situation that Defendant created.  University Rehabilitation Alliance, Inc. v Farm Bureau General Insurance Company of Michigan, Michigan Court of Appeals Decision for Publication Dated July 22, 2008, Docket No. 272615.

Recommendation – An insured must be aware of the fee agreement between Plaintiff’s counsel and the insured to properly evaluate the claim.

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