Downs v. State Farm Mut. Auto. Ins. Co.

ERIK SCOTT DOWNS and ERIKA TYLER, Individually and as Next Friend of EZSAIA HOPSON and EZYRIAH HOPSON, Plaintiffs-Appellees, and RENAISSANCE CHIROPRACTIC, PC, CENTRIUM PHYSICAL THERAPY, PC, and CORE HEALING BODYWORKS, LLC, Intervening Plaintiffs-Appellees, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant-Appellant, and TASHAUN WOODLEY, Defendant.

No. 352522

Court of Appeals of Michigan

September 23, 2021

UNPUBLISHED

Genesee Circuit Court LC No. 17-109960-CK

Before: Cavanagh, P.J., and K. F. Kelly and Redford, JJ.

Per Curiam.

Defendant^[1] appeals by leave granted^[2] orders granting in part and denying in part its motion for summary disposition of intervenors' claim for unjust enrichment arising from medical treatment provided by intervenors to plaintiffs for injuries allegedly sustained in a motor-vehicle accident. We reverse and remand.

I. FACTS AND PROCEDURAL BACKGROUND

Plaintiffs Erika Tyler, Erik Downs, Ezsaia Hopson, and Ezyriah Hopson, were allegedly injured in a motor-vehicle accident when their vehicle was rear-ended by Tashaun Woodley. Tyler's vehicle was insured by defendant. As a result of their injuries, plaintiffs sought treatment from various medical providers, including intervenors, Renaissance Chiropractic, PC, Centrum Physical Therapy, PC, and Core Healing Bodyworks, LLC.

Plaintiffs filed their complaint against defendant seeking first-party no-fault benefits. The details of the litigation between plaintiffs and defendant are not particularly relevant, up to a certain point. In late April 2019, defendant moved to dismiss Tyler's claims for violation of a court order, obstructing depositions, and for inappropriate behavior. Defendant's motion detailed Tyler's behavior, including her use of various expletives during depositions, and her efforts to obstruct and cancel those depositions. Tyler responded, indicating defense counsel was demeaning and disrespectful, and indicated she had "blatantly obvious" psychiatric issues. Initially, the trial court denied defendant's motion to dismiss, but warned Tyler "to behave" and indicated she was "on thin ice." The order denying the motion also required Tyler to attend another deposition.

In early June 2019, however, defendant renewed its motion to dismiss. Reiterating Tyler's behavior outlined in its previous motion, defendant raised new issues that arose during Tyler's mid-May 2019 deposition. There, Tyler "assaulted" defense counsel by poking him in the forehead and spit in his face, threatened the court reporter, and disrespected the trial court. Tyler again reminded the trial court of her mental illness, and asserted dismissal would be inappropriate. The trial court disagreed and granted defendant's motion, dismissing Tyler's claims against defendant with prejudice. In the order granting defendant's motion to dismiss, the trial court handwrote: "It is further ordered that this dismissal does not prevent [the] rights of medical providers to intervene."

On July 1, 2019, Tyler assigned her rights to intervenors. The next day, intervenors moved to intervene. The trial court initially denied intervention. Intervenors moved for reconsideration asserting, in relevant part, that the trial court failed to consider and analyze intervenors' claims of breach of contract, account stated, and unjust enrichment. After a rehearing, the trial court granted, in part, intervenors' motion to intervene. Specifically, the trial court allowed intervenors to intervene with respect to their claims of account stated and unjust enrichment. The trial court denied intervention as it related to intervenors' statutory claim for personal-protection-insurance (PIP) benefits under the no-fault act, MCL 500.3101 et seq., and breach of contract.

Intervenors filed their complaint, alleging two counts: account stated and unjust enrichment. Relevant here, intervenors' claim for unjust enrichment alleged that defendant was conferred a benefit in the form of services provided by intervenors to plaintiffs, failed to remit payment to intervenors, and would be unjustly enriched if not required to pay intervenors for the services provided.

In lieu of an answer, defendant moved for summary disposition. Defendant outlined four bases for summary disposition: (1) intervenors' exclusive remedy, if any, was with the no-fault act; (2) to the extent no-fault liability was pleaded, it was barred because intervenors' claims were either derivative of Tyler's claim, which the trial court had dismissed with prejudice, or barred by the one-year-back rule in MCL 500.3145; (3) intervenors' account-stated claim failed to state a claim because there was no contractual or implied contractual relationship between intervenors and defendant regarding the services provided to Downs and Tyler; and (4) intervenors' claim of unjust enrichment could not be sustained because there was no showing defendant unjustly obtained a benefit.

After intervenors responded, and without a hearing, the trial court entered an opinion and order granting summary disposition to defendant of the account-stated claim, but denying summary disposition of the claim for unjust enrichment, finding intervenors pleaded sufficient facts to support their unjust-enrichment claim. The trial court noted intervenors' allegations that defendant had "received and retained" at least $62, 215 from intervenors and that the balance owed related to intervenors' "respective rehabilitation services provided to [d]efendant's insureds" (Tyler and Downs). The trial court also noted intervenors' allegations that they provided defendant certain services related to the "insureds' rehabilitation [and that] provided a uniquely helpful benefit to" defendant, which, according to intervenors, led them to be "inequitably out at least $62, 215 and the value of the provision of the case-management services." The trial court found, "considering the allegations in the intervening complaint alone or [the] record as a whole in the light most favorable to" intervenors, reasonable minds could differ regarding whether defendant "received and retained a benefit from [intervenors] and inequity has resulted from such retention." The trial court found that summary disposition of intervenors' claim for unjust enrichment "pursuant to MCR 2.116(C)(7), (8), or (10)" was improper.

The trial court later entered an order supplementing its initial order. After summarizing defendant's arguments and the court's own findings in the initial order, the trial court found the unjust-enrichment claim did "not hinge upon the 'No-Fault Act' and, in turn, MCL 500.3145 (the 'one-year-back' rule)[, ] since the claim is entirely equitable in nature." The trial court concluded the one-year-back rule did not apply and the "filing date of the intervening complaint (i.e., November 1, 2019) [was] not relevant here." The trial court found "the request for reimbursement for services provided by Intervening-Plaintiffs to Mr. Downs and Ms. Tyler before that date is not barred by the rule." This appeal followed.

II. UNJUST ENRICHMENT

Defendant argues that the trial court erred when it determined intervenors stated a cause of action for unjust enrichment to recover benefits for medical services intervenors allegedly provided to plaintiffs. We agree.

"This Court reviews de novo whether a trial court properly granted a motion for summary disposition." Barnard Mfg Co, Inc v Gates Performance Engineering, Inc, 285 Mich.App. 362, 369; 775 N.W.2d 618 (2009). The trial court stated that summary disposition was "improper as to the unjust-enrichment claim pursuant to MCR 2.116(C)(7), (8), or (10)." The trial court also explained its denial of summary disposition was made "considering the allegations in the complaint alone or [the] record as a whole . . . ." Because the trial court did not specify the rule under which it denied summary disposition, and mentioned that its decision was, at least potentially, made in consideration of the record "as a whole," we review the issues as having been decided under MCR 2.116(C)(10). See Outdoor Sys Advertising, Inc v Korth, 238 Mich.App. 664, 666 n 2; 607 N.W.2d 729 (1999). Regarding review of motions under MCR 2.116(C)(10), our Supreme Court in Maiden v Rozwood, 461 Mich. 109, 120; 597 N.W.2d 817 (1999), stated:

A motion under MCR 2.116(C)(10) tests the factual sufficiency of the complaint. In evaluating a motion for summary disposition brought under this subsection, a trial court considers affidavits, pleadings, depositions, admissions, and other evidence submitted by the parties, MCR 2.116(G)(5), in the light most favorable to the party opposing the motion. Where the proffered evidence fails to establish a genuine issue regarding any material fact, the moving party is entitled to judgment as a matter of law. [Id. (citations and quotation marks omitted).]

"This Court has long recognized the equitable right of restitution when a person has been unjustly enriched at the expense of another." Mich Ed Employees Mut Ins Co v Morris, 460 Mich. 180, 197; 596 N.W.2d 142 (1999). "[W]hether a claim for unjust enrichment can be maintained is a question of law . . . ." Morris Pumps v Centerline Piping, Inc, 273 Mich.App. 187, 193; 729 N.W.2d 898 (2006). "When unjust enrichment exists, the law operates to imply a contract in order to prevent it." Keywell & Rosenfeld v Bithell, 254 Mich.App. 300, 327-328; 657 N.W.2d 759 (2002) (quotation marks and citation omitted). A contract will be implied "only if there is no express contract covering the same subject matter." Local Emergency Fin Assistance Loan Bd v Blackwell, 299 Mich.App. 727, 734; 832 N.W.2d 401 (2013) (quotation marks and citation omitted).

Defendant argues that the trial court erred when it allowed intervenors' unjust-enrichment...