Opinion
Docket No. 49260.
Decided September 8, 1981.
Norman P. Ochs, P.C. (by John R. Rinn), for plaintiff.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Stanley D. Steinborn, Chief Assistant Attorney General, and Edgar L. Church, Jr., Assistant Attorney General, for defendant.
This matter arises from an automobile accident involving the cars of Ronald and Joyce Johnson and John L. Woodson, which occurred on July 17, 1973. Woodson was uninsured at the time of the mishap.
Suit was commenced on June 6, 1975. Following Woodson's default, the Secretary of State actively entered the case pursuant to MCL 257.1108; MSA 9.2808, the same being a part of the Motor Vehicle Accident Claims Act. MCL 257.1101 et seq.; MSA 9.2801 et seq.
Following a trial on the merits, judgments were returned in favor of Ronald Johnson in the amount of $20,500 and in favor of Joyce Johnson for $12,500. These judgments were subject to setoffs of $8,461 and $7,000 respectively. The deductions were occasioned by payments made to plaintiffs from the uninsured motorist provisions of their own automobile insurance policies.
Pursuant to MCL 257.1108; MSA 9.2808, the Motor Vehicle Accident Claims Fund became obligated to satisfy the judgments. Upon the entry of these judgments, a dispute arose as to the amount of interest which had accrued. The Secretary of State, representing the fund, contended that interest accrued only on the fund's ultimate liability, the amount of the judgments after the setoffs were deducted. Plaintiffs asserted that interest was owed on the initial dollar amount of the judgments, i.e., ultimate liability plus the setoff figures.
The Secretary of State on behalf of the fund tendered the undisputed amount of interest and refused to pay the remainder. Plaintiffs brought a motion to compel payment of the remaining amount. The motion was approved and appropriate order entered. The present appeal by leave granted then followed.
The fund's liability is confined to those limits set forth in MCL 257.1123(1); MSA 9.2823(1). There is no question that the fund is entitled to a setoff in an amount equal to that which a plaintiff has received from his own insurer in the way of uninsured motorist coverage. Ingram v McCastle, 97 Mich. App. 593; 296 N.W.2d 116 (1980).
Plaintiffs place considerable reliance upon Douglas v Secretary of State, 32 Mich. App. 533, 538; 189 N.W.2d 114 (1971), which holds that the fund is liable for both pre-judgment and post-judgment interest. Douglas further states that such interest is limited only to the "statutory obligation" of the fund. It is noted that Douglas addresses the issue of interest liability in terms of judgments in excess of the statutory limit. The present case is distinguishable in that the awards, with or without setoffs, fall within the statutory limits.
Reference is made to Silisky v Midland Ross Corp, 97 Mich. App. 470, 475-477; 296 N.W.2d 576 (1980). The case holds that where prior settlements are deducted from the facial value of a given judgment, interest accrues upon the ultimate liability of the judgment only and not upon its facial value. A contrary result would force a losing party to pay interest on a debt for which that party had no liability. This amounts to unjust enrichment.
In the instant case, the foregoing logic is even more compelling. The Legislature has clearly defined the statutory limits in terms of both ultimate liability and in terms of required setoffs. We believe that the legislative intent was that the fund should pay interest only on its ultimate liability.
The decision of the trial court being to the contrary, that decision is reversed. The matter is remanded for entry of an order in conformity with this opinion. No costs are assessed, a novel question being presented.