Discharge of Insurer's Liability Affirmed under MCL 500.3112 in Assignment of Benefits Case
A driver injured in a 2018 auto accident received medical services from plaintiff pain clinic during the period of March to September 2019. As part of the services, the driver assigned his rights for no-fault benefits to plaintiff. The assignments contained a provision that the rights could not be revoked unless both parties agreed.
The driver later filed his own lawsuit against the defendant insurance company, alleging breach of contract for the defendant’s failure to pay PIP benefits. The driver agreed to settle this lawsuit for $9,000. As part of the settlement agreement, the driver agreed to release defendant from “all claims PAST, PRESENT and FUTURE for medical benefits/expenses.” Prior to finalizing the release, the driver sent defendant copies of medical expenses he incurred. The insurance company provided an Explanation of Benefits (EOB) denying the plaintiff driver’s claims for lack of documentation and also questioned the reasonableness of the charges. The defendant also claimed that some medical invoices were paid. After settlement, the insurance company sent the driver additional EOBs stating, ”CLAIMS DENIED. SETTLEMENT BY RELEASE FOR ALL PAST, PRESENT, & FUTURE CLAIMS.”
In November 2019, plaintiff pain clinic filed a complaint against defendant insurance company alleging breach of contract and violation of MCL 500.3112, the no-fault act. Plaintiff pain clinic requested payment of $41,884.13 for services rendered to driver. The trial court granted summary disposition to defendant, stating that the driver’s release barred plaintiff’s claims.
The appellate court affirmed the summary disposition. The court found that defendant’s liability to plaintiff pain clinic was discharged since defendant had not received proper notification of claims, regardless of the underlying assignment. The court also determined that the dispute between the driver and the pain clinic over the driver’s revocation of rights was a matter for the two parties to resolve.
The case is Advance Pain Care PLLC v. Trumbull Ins. Co., No. 353991, Oakland Circuit Court, LC No. 2019-177739-NF. Unpublished opinion dated May 13, 2021.
Click on the link to read the appellate court ruling.
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