Tivon Humphries v. 21st Century Premier Insurance Company

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

TIVON HUMPHRIES, UNPUBLISHED

April 16, 2019

Plaintiff-Appellee-Cross-Appellant,

v No. 339980

Wayne Circuit Court

21st CENTURY PREMIER INSURANCE LC No. 14-013710-NF

COMPANY,

Defendant-Appellant-Cross-

Appellee.

ST. JOHN MACOMB-OAKLAND HOSPITAL,

Plaintiff-Appellee,

v No. 339981

Wayne Circuit Court

21st CENTURY PREMIER INSURANCE LC No. 15-009319-NF

COMPANY,

Defendant-Appellant.

Before: MURRAY, C.J., and SERVITTO and SHAPIRO, JJ.

PER CURIAM.

In these consolidated appeals, 21st Century Premier Insurance Company (defendant)

appeals as of right judgments entered in favor of plaintiffs, Tivon Humphries (Humphries) and

St. John Macomb-Oakland Hospital (St. John) and against it. Defendant challenges the trial

court’s evidentiary ruling and its ruling on defendant’s motion for a new trial. Humphries cross-

appeals the trial court’s entry of directed verdict in favor of defendant concerning replacement

services and its failure to award Humphries attorney fees under MCL 500.3148(1). We reverse

and vacate the judgment in favor of St. John and against defendant, and order the trial court to

enter an order dismissing St. John’s claims. We reverse the trial court’s entry of a directed

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verdict in favor of defendant concerning Humphries’ claim for replacement services, order an

amendment of the judgment in Humphries favor, consistent with this opinion, and affirm its

order denying Humphries’ motion for attorney fees.

Humphries was involved in a car accident on July 25, 2014, and sustained injuries.

Defendant, who had issued an insurance policy to Humphries, failed to pay Humphries the

benefits he was entitled to under the policy. Humphries thus initiated an action against defendant

in October of 2014 (docket no. 339980) to recover those benefits. In July of 2015, St. John filed

a declaratory action against defendant alleging that it provided medical care to Humphries for the

injuries he sustained in the accident (docket no. 339981). St. John asserted that defendant owed

St. John all medical bills incurred by it, relative to the medical services it provided to Humphries

under the no-fault act, MCL 500.3101 et seq., and that it refused to pay the benefits owing.

These matters were consolidated before the trial court. At the conclusion of a single jury trial,

and consistent with the jury’s verdict, the court entered a judgment in favor of Humphries in the

amount of $400,725.04, plus potential case evaluation sanctions, and taxable costs, and a

separate judgment in favor of St. John and against defendant for $55,950.72, plus potential case

evaluation sanctions, and costs.

Defendant thereafter moved for a new trial, which the trial court denied. Humphries and

St. John moved for attorney fees and case evaluation sanctions and the trial court denied the

request for attorney fees made under MCL 500.3148. These appeals followed.

On appeal, defendant contends that the trial court erred in denying its motion for a new

trial when its substantial rights were materially affected by the trial court’s decision regarding the

admissibility of expert testimony. We disagree.

This Court reviews for an abuse of discretion a trial court’s decision to grant or deny a

motion for a new trial. People v Rao, 491 Mich 271, 279; 815 NW2d 105 (2012). An abuse of

discretion occurs when the trial court renders a decision falling outside the range of principled

decisions. Id. We also review a trial court’s decision to admit or exclude evidence for an abuse

of discretion. People v Kowalski, 492 Mich 106, 119; 821 NW2d 14 (2012).

In this case, defendant sought to have a biomechanical expert, Steven Rundell, testify that

the car accident did not provide enough force to cause Humphries’ disc herniations, and at the

same time, moved to exclude the testimony of Humphries’ accident reconstructionist, Timothy

Robbins, asserting that the reconstructionist was not qualified to provide testimony with respect

to whether the accident caused Humphries’ injuries. Humphries sought to strike any of

Rundell’s testimony regarding the causation of his injuries. The trial court ordered that both

Rundell and Robbins were precluded from testifying about the causation of injuries, but could

testify concerning their areas of expertise. According to defendant, the trial court erroneously

excluded some of Rundell’s testimony and that this exclusion was particularly erroneous when

the trial court allowed Robbins to testify outside the scope of his experience and to a non-

scientific theory, contrary to MCL 600.2955. Defendant thus asserts that it was denied a fair

trial.

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MRE 702 addresses the admission of expert witness testimony. The rule provides:

If the court determines that scientific, technical, or other specialized knowledge

will assist the trier of fact to understand the evidence or to determine a fact in

issue, a witness qualified as an expert by knowledge, skill, experience, training, or

education may testify thereto in the form of an opinion or otherwise if (1) the

testimony is based on sufficient facts or data, (2) the testimony is the product of

reliable principles and methods, and (3) the witness has applied the principles and

methods reliably to the facts of the case.

A court considering whether to admit expert testimony under MRE 702 acts as a gatekeeper and

has a fundamental duty to ensure that the proffered expert testimony is both relevant and reliable.

Kowalski, 492 Mich at 119. To that end, a court evaluating proposed expert testimony must

consider whether the testimony “(1) will assist the trier of fact to understand a fact in issue, (2) is

provided by an expert qualified in the relevant field of knowledge, and (3) is based on reliable

data, principles, and methodologies that are applied reliably to the facts of the case.” Id. at 120.

MRE 702 requires a searching inquiry of the data underlying expert testimony, but also of the

manner in which the expert interprets and extrapolates from those data. Gilbert v

DaimlerChrysler Corp, 470 Mich 749, 782; 685 NW2d 391 (2004). “Careful vetting of all

aspects of expert testimony is especially important when an expert provides testimony about

causation.” Id.

In addition, MCL 600.2955 states:

(1) In an action for the death of a person or for injury to a person or property, a

scientific opinion rendered by an otherwise qualified expert is not admissible

unless the court determines that the opinion is reliable and will assist the trier of

fact. In making that determination, the court shall examine the opinion and the

basis for the opinion, which basis includes the facts, technique, methodology, and

reasoning relied on by the expert, and shall consider all of the following factors:

(a) Whether the opinion and its basis have been subjected to scientific testing and

replication.

(b) Whether the opinion and its basis have been subjected to peer review

publication.

(c) The existence and maintenance of generally accepted standards governing the

application and interpretation of a methodology or technique and whether the

opinion and its basis are consistent with those standards.

(d) The known or potential error rate of the opinion and its basis.

(e) The degree to which the opinion and its basis are generally accepted within the

relevant expert community. As used in this subdivision, “relevant expert

community” means individuals who are knowledgeable in the field of study and

are gainfully employed applying that knowledge on the free market.

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(f) Whether the basis for the opinion is reliable and whether experts in that field

would rely on the same basis to reach the type of opinion being proffered.

(g) Whether the opinion or methodology is relied upon by experts outside of the

context of litigation.

The proponent of evidence bears the burden of establishing the relevance and admissibility of the

evidence. Gilbert, 470 Mich at 781.

In Gilbert, the plaintiff was permitted to have a social worker testify that sexual

harassment the plaintiff suffered neurologically changed her brain chemistry, which led to

changes in the plaintiff’s behavior. The social worker’s opinion was based on his analysis of

medical records from various hospitals and clinics where plaintiff was treated for substance

abuse. Our Supreme Court found that the social worker “unquestionably used the content of

plaintiff’s treatment records to render an opinion that required medical expertise.” Id. at 787. It

further stated:

Where the subject of the proffered testimony is far beyond the scope of an

individual’s expertise—for example, where a party offers an expert in economics

to testify about biochemistry—that testimony is inadmissible under MRE 702. In

such cases, it would be inaccurate to say that the expert’s lack of expertise or

experience merely relates to the weight of her testimony. An expert who lacks

“knowledge” in the field at issue cannot “assist the trier of fact.” [Id. at 789]

The Gilbert Court concluded that “the faux ‘medical’ opinion of an individual who lacked any

medical education, experience, training, skill, or knowledge became the linchpin of plaintiff’s

case and unmistakably affected the verdict.” Id. at 783.

In this matter, Rundell testified at his deposition that he was not a doctor and could not

give opinion testimony based on medical theories. Rundell, having no medical background, thus

could not testify as to the existence or lack of a medical condition and any causal link between an

accident and an alleged injury. As in Gilbert, testimony concerning the cause of a medical injury

was beyond the scope of Rundell’s expertise. His testimony concerning a medical injury would

not have been reliable, scientific, or other specialized knowledge that he possessed as an expert

in biomechanics and thus would not have assisted the jury. The trial court did not abuse its

discretion in limiting Rundell’s testimony to that in his field of expertise—biomechanics.

The trial court also did not abuse its discretion in allowing Humphries’ expert, Robbins,

to testify as he did. While the trial court admitted it should not have allowed Robbins to testify

as a rebuttal witness to Rundell’s testimony, the parties discussed having Robbins as a rebuttal

witness due to his unavailability at trial and defendant stated that it had no issue with Robbins

testifying on rebuttal.

Robbins, an accident reconstructionist, was limited in his testimony in the same way that

Rundell was—to his field of expertise. Robbins was not, as defendant claims, questioned just

from a “common sense,” rather than scientific, standpoint. Robbins presented his qualifications

and training to the jury and testified that he looked at vehicle photographs, vehicle specifications,

the roadway and roadway design, and statements and testimony of other witnesses. Robbins

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testified that reconstructionists put pieces back together in a scientific method to determine what

happened. While certain elements of Robbins testimony were based on “common knowledge”

such as that if one knows his body is going to be shaken violently, one would generally brace or

prepare for what was coming, that some testimony is based on common sense does not make

Robbins unqualified to render an expert opinion on how the accident at issue occurred and the

potential force involved in the accident.

Finally, though defendant filed a pretrial motion in limine to preclude Robbins from

testifying because he was not qualified to rebut a biomechanics expert testimony, the trial court

properly found that Robbins, as an accident reconstructionist, was going to provide testimony

that was somewhat similar to Rundell and that he could testify based on his knowledge and

experience regarding force. Defendant called Rundell as an expert to establish that the accident

was minor and did not provide enough force to cause Humphries’ injuries. An accident

reconstructionist could refute how significant the accident was and the force that was put on

Humphries’ vehicle, which was a significant issue at trial. And, at trial, defendant’s counsel

stated that it had no problem with Robbins being called as a rebuttal witness. Defendant was not

denied a fair trial by the admission of Robbins’ testimony and was not entitled to a new trial

based upon the admission of his testimony.

Defendant also claims it was denied a fair trial by virtue of the attorney for St. John

making statements during his closing argument allegedly intended to mislead the jury with

respect to attorney misconduct. Specifically, during closing argument, St. John’s counsel stated:

We have Dr. Rundell. I’m not going to go over Dr. Rundell’s testimony

or Dr. Robbins’ testimony, you’ve heard it over and over again. But I would like

to point out one thing. Regardless of the side swiping, his opinion, or the spin

action, think about his opinion. He never offered an opinion with respect to

whether or not the disk injury was related to the accident.

Defendant asserts that these statements amounted to attorney misconduct by St. John’s counsel

since the trial court had specifically ruled that Rundell was prohibited from testifying to whether

the accident caused Humphries’ injuries. We disagree.

“An attorney’s comments do not normally constitute grounds for reversal unless they

reflect a deliberate attempt to deprive the opposing party of a fair and impartial proceeding.”

Zaremba Equip, Inc v Harco Nat Ins Co, 302 Mich App 7, 21; 837 NW2d 686 (2013). “Reversal

is required only where the prejudicial statements” reveal a deliberate attempt to inflame or

otherwise prejudice the jury, or to “deflect the jury’s attention from the issues involved.” Id.

Even where an attorney may have attempted to deliberately inject something improper into a

case, reversal is unwarranted unless the comments had the actual effect of diverting the jury’s

attention from the issue or otherwise control the verdict. Knight v Gulf & Western Properties,

Inc, 196 Mich App 119, 132-133; 196 NW2d 119 (1992). Misconduct of counsel will also not

justify a new trial if the error was harmless. Wiley v Henry Ford Cottage Hosp, 257 Mich App

488, 501-502; 668 NW2d 402 (2003).

The challenged statement was brief and defendant’s counsel immediately objected,

stating that just because it was closing argument “doesn’t mean that I can’t object when there

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were things that were not supposed to be discussed in this case that the court ruled on.” Thus,

defendant’s counsel brought it to the jury’s attention that St. John’s counsel was attempting to

bring in something that the trial court had prohibited. And, there was no indication that the brief

comment diverted the jury’s attention from the issue. Both parties had presented the testimony

of medical experts regarding Humphries’ injuries and their causation. Moreover, the trial court

instructed the jury that attorney statements are not evidence and that the evidence the jury was to

consider consists of the testimony of witnesses and any exhibits offered and received. Thus,

even if the brief comment was improper, any error was rendered harmless by the court’s

instruction. The trial court correctly determined that defendant was not entitled to a new trial

based upon attorney misconduct.

Finally, defendant asserts that the cumulative effect of the trial court’s errors was added

to due to the fact that St. John has no standing to sue in this case per Covenant Med Ctr, Inc v

State Farm Mut Auto Ins Co, 500 Mich 191, 195; 895 NW2d 490 (2017). We agree that St. John

has no standing to bring its claim against defendant.1

In Covenant, 500 Mich 191, our Supreme Court held that healthcare providers do not

have a statutory right to bring a cause of action against an insurer to recover PIP benefits under

the no-fault act. In W A Foote Mem Hosp v Mich Assigned Claims Plan, 321 Mich App 159,

176, 199; 909 NW2d 38 (2017) this Court held that Covenant applies retroactively, i.e., that it

“applies to all cases still open on direct review.” Id. at 176, 196.

The instant case was still proceeding in the trial court when the Covenant opinion was

issued, and it is now before this Court on direct review. Therefore, Covenant applies

retroactively to the instant case. Id. St. John’s claims against defendant were for breach of

contract and for declaratory relief. Under Covenant, St. John has no independent standing for

breach of contract against defendant and may not maintain a direct action against defendant to

recover PIP benefits allegedly owed by defendant for services St. John provided to Humphries

related to his medical care. Covenant, 500 Mich at 195-196.

Though St. John asserts that defendant did not raise the issue of standing before the trial

court, in Bronson Healthcare Group, Inc v Michigan Assigned Claims Plan, 323 Mich App 302,

305-306; 917 NW2d 682 (2018), this Court clarified that Covenant was to be applied to cases

even where the issue of standing or legal capacity to sue was never raised before the trial court.

Bronson Healthcare stated, “we have previously rejected preservation arguments relating to

Covenant and exercised our discretion to review Covenant arguments that were not raised before,

addressed and decided by, the trial court.” Id., citing W A Foote, 321 Mich App at 173-174; VHS

Huron Valley Sinai Hosp v Sentinel Ins Co, 322 Mich App 707, 714719; 916 NW2d 218 (2018)

(holding that a consent judgment entered into in favor of a medical provide did not result in the

insurer’s waiver of opportunity to challenge the provider’s standing).

1

St. John argues that it would be fundamentally unfair to conclude on appeal – especially with

very little advocacy by defendant – that Covenant bars its claim. But because St. John raised the

Covenant issue in its brief on appeal, it is not fundamentally unfair to consider the issue.

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Here, that St. John and defendant had tried the case before a jury is a distinction from

Covenant, W. A. Foote, and VHS of no significance. W A Foote, 321 Mich. App. at 191

(quotation marks omitted), clearly states that the Covenant decision was to be applied in “all

cases still open on direct review and as to all events, regardless of whether such events predate or

postdate [the] announcement of the rule.” The phrase “all cases” must necessarily include

verdicts, and even judgments, that happened before Covenant was decided in cases still open on

direct appeal. This Court has held that “there cannot be any broader classification than the word

‘all,’ and ‘all’ leaves room for no exceptions.” Peters v Gunnell, Inc, 253 Mich App 211, 223;

655 NW2d 582 (2002) (citations omitted). Our application of Covenant to this case is consistent

with general principles of retroactivity.

St. John, as a medical provider, brought a direct claim against defendant under the no-

fault act. Pursuant to Covenant, 500 Mich at 196, St. John had no legal authority to do so, absent

the existence of an assignment of rights from the insured (of which there is no indication and is

unlikely considering that St. John and Humphries both proceeded to trial against defendant). The

judgment in favor of St. John and against defendant must therefore be vacated.

On cross-appeal, Humphries contends that the trial court committed reversible error when

it granted defendant’s motion for a directed verdict and struck Humphries’ claim for replacement

services. We agree.

This Court reviews de novo a grant or denial of a motion for directed verdict. Aroma

Wines & Equip, Inc v Columbia Distrib Servs, Inc, 303 Mich App 441, 446; 844 NW2d 727

(2013). The evidence, and any reasonable inferences therefrom, must be viewed in the light

most favorable to the non-moving party, and the motion granted only if there is no factual

dispute or reasonable jurors could not differ. Id.

MCL 500.3107(1)(c) provides for the payment of replacement services as a no-fault PIP

benefit as follows:

Expenses not exceeding $20.00 per day, reasonably incurred in obtaining ordinary

and necessary services in lieu of those that, if he or she had not been injured, an

injured person would have performed during the first 3 years after the date of the

accident, not for income but for the benefit of himself or herself or of his or her

dependent.

Consistent with the statutory language, the insurance policy issued by defendant provides for the

payment of replacement services “not exceeding $20.00 per day, the insured . . . reasonably incur

in obtaining the benefit of ordinary and necessary services in lieu of those that the insured would

have performed during the first three years after the date of the accident . . . .”

Defendant does not allege that Humphries did not require replacement services or deny

that he has certificates stating that he requires the same. The only issue defendant brings with

respect to replacement services is that there was no testimony or evidence in the record that

defendant’s wife expected to be compensated for the replacement services she provided and no

record evidence of the daily rate she was seeking. We disagree.

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In an October of 2016 joint pre-trial order, the parties stipulated to the admission of

certain exhibits at trial, including replacement services proofs and defendant’s full and complete

PIP file. These documents included ones where defendant’s wife filled out household services

statements for the dates of July 25, 2014, through August 31, 2014. Then again for the month of

October 2014 and for every month from November of 2014 through June of 2015. She also

prepared an affidavit of household services on August 4, 2014, stating that she performed

replacement services for Humphries from July 25, 2014, “through the present and ongoing.” The

affidavit further states that “I am claiming $20 a day from July 25, 2014, through August 2014

and ongoing.”

Though Humphries’ wife did not testify at trial and Humphries testified only in general

terms of what his wife did as far as services after he was injured, the documentary evidence

established that Humphries’ wife performed replacement services for him and expected to be

compensated for the same at a rate of $20.00 per day. Ultimately, the determination under the

no-fault act of what is a reasonable charge is for the trier of fact. Bronson Methodist Hosp v

Auto-Owners Ins Co, 295 Mich App 431, 454; 814 NW2d 670 (2012). The documentary

evidence presented in the household services statements and the affidavit of Humphries’ wife

was sufficient to allow the jury to adequately calculate the approximate amount of replacement

services to which plaintiff was entitled. The trial court thus erred in granting defendant’s motion

for directed verdict as to the replacement services.

Humphries next contends that the trial court erred in failing to award him attorney fees

requested pursuant to MCL 500.3148(1). We disagree.

A trial court’s decision concerning whether an insurer acted reasonably in withholding

benefits (such that they should pay attorney fees) involves a mixed question of law and fact.

Ross v Auto Club Group, 481 Mich 1, 7; 748 NW2d 552 (2008). “What constitutes

reasonableness is a question of law, but whether the defendant’s denial of benefits is reasonable

under the particular facts of the case is a question of fact.” Id. Questions of law are reviewed de

novo, and a trial court’s findings of fact are reviewed for clear error. Id.

The no-fault act provides for an award of reasonable attorney fees to a claimant if the

insurer unreasonably refuses to pay the claim. Specifically, MCL 500.3148(1) provides:

An attorney is entitled to a reasonable fee for advising and representing a claimant

in an action for personal or property protection insurance benefits which are

overdue. The attorney’s fee shall be a charge against the insurer in addition to the

benefits recovered, if the court finds that the insurer unreasonably refused to pay

the claim or unreasonably delayed in making proper payment.

This statute establishes two prerequisites for the award of attorney fees. First, the benefits must

be overdue, meaning “not paid within 30 days after [the] insurer receives reasonable proof of the

fact and of the amount of loss sustained.” MCL 500.3142(2). Second, in post judgment

proceedings, the trial court must find that the insurer “unreasonably refused to pay the claim or

unreasonably delayed in making proper payment.” MCL 500.3148(1); Moore v Secura Ins, 482

Mich 507, 517; 759 NW2d 833 (2008).

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An insurer’s refusal or delay places a burden on the insurer to justify its refusal or delay,

and the insurer can meet this burden by showing that the refusal or delay is the product of a

legitimate question of statutory construction, constitutional law, or factual uncertainty. United

Southern Assur Co v Aetna Life & Cas Ins Co, 189 Mich App 485, 492; 474 NW2d 131 (1991).

The determinative factor in the trial court’s inquiry is not whether the insurer ultimately is held

responsible for benefits, but whether its initial refusal to pay was unreasonable. Ross, 481 Mich

at 11.

Here, defendant, through its adjuster Timothy McQuillan, testified that the emergency

room said Humphries had a possible cervical strain, and was released back to work. McQuillan

testified that he looks at several things when evaluating a claim for an objective injury, including

statements, vehicle damage, accident severity, medical records, and witnesses.

McQuillan testified that he sent a letter to Humphries’ attorney on September 14, 2014,

stating the inconsistencies he found, and stating that the insurance company may not be able to

pay off the claim. McQuillan testified that just because the hospital told Humphries to follow up

with his primary care physician doesn’t mean that an insurance payout had to be made.

McQuillan testified he received the emergency room medical records on October 28, 2014. He

testified that he did not pay for physical therapy because Humphries utilized that service at the

direction of his primary care doctor.

When Humphries filed his complaint on October 23, 2014, it appears that defendant had

very limited records. It only had the police report, which indicated a sideswipe car accident with

minimal damage to the car and no injuries and a bill from a spinal rehabilitation facility. Thus,

Humphries had not yet provided a reasonable proof of loss to defendant prior to his filing of the

complaint (MCL 500.3142(2)) and the benefits sought were not yet overdue. And, defendant

obtained a biomechanical expert, Rundell, who began analyzing the data concerning the crash

and forces in December of 2014. His report was final in May of 2015, and concluded that the

accident at issue could not have had enough force to have caused Humphries injuries. Given the

information defendant had, defendant’s initial decision to refuse or delay payments was not

unreasonable. Ross, 481 Mich at 11. The trial court properly denied an award of attorney fees

under MCL 500.3148.2

We vacate the judgment in favor of St. John and against defendant and order the trial

court to enter an order dismissing St. John’s claims. We reverse the trial court’s entry of a

2

Humphries cites to Bronson Health Care Group, Inc v Titan Ins Co, 314 Mich App 577, 582;

887 NW2d 205 (2016), for the proposition that an insurer is not allowed time beyond the

statutory 30 days to conduct its own investigation regarding the eligibility of the claimant to

receive benefits. However, that case pertained to an assigned insurer under the Michigan

Automobile Insurance Placement Facility, which only itself assigns a claim to an insurer after

reviewing a claimant's eligibility. Id.

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directed verdict in favor of defendant concerning Humphries’ claim for replacement services,

order an amendment of the judgment in Humphries’ favor consistent with this opinion, and

affirm its order denying Humphries’ motion for attorney fees. We do not retain jurisdiction.

/s/ Christopher M. Murray

/s/ Deborah A. Servitto

/s/ Douglas B. Shapiro

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