Summary Disposition Granted to Plaintiff on Issue of Recission in PIP Benefits Dispute

This first-party, no-fault action for PIP benefits involved, in part, a material question of fact regarding plaintiff’s supposed acceptance of the policy recission. The lead plaintiff driver was the husband in a married couple. He did not read or write English, and his wife did not drive or hold a license. The defendant insurance company took steps to cancel the policy following a December 2017 auto accident. The carrier claimed that the wife was not listed as a “household resident,” although the application language asked the plaintiff to list all “drivers” in the household. The insurance company returned the premium payment in a check which the plaintiff cashed, but there was some confusion on the timing and format of the carrier’s cancellation notice. The appellate court affirmed the trial court’s denial of the summary disposition requested by the defendant carrier.  

The appellate court also addressed the nonexclusive five-factor test to assess whether recission of an insurance policy is equitable to a third party. While one factor favored the defendant (i.e., plaintiff did not report that he was married), the four other factors favored the plaintiff. The court noted that the fourth factor addresses a current situation, not what could have happened in the past. At the time of the appellate court ruling the plaintiff was barred from recovering PIP benefits through the Michigan Assigned Claims Plan (MACP) due to the one-year statute of limitations and the one-year back rule.  

The Michigan Court of Appeals affirmed the trial court ruling and remanded the case for further proceedings.  

The case is Estate of Audisho v. Everest Nat’l Ins. Co., unpublished order of the Michigan Court of Appeals, entered April 29, 2020 (Docket No. 352391). Released June 24, 2021, No. 352391 in Macomb Circuit Court, LC No. 2018-004951-NF.  

Click on the link to read the opinion of the Michigan Court of Appeals.  

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