Opinion
No. 354765
09-02-2021
MICHIGAN HEAD & SPINE INSTITUTE PC, Plaintiff-Appellant, v. AUTO-OWNERS INSURANCE COMPANY and Home-Owners Insurance Company, Defendants-Appellees.
Miller & Tischler, PC (by Sean F. Kelly ) for plaintiff. Cummings, McClorey, Davis & Acho, PLC, Livonia (by Jacklyn P. Paletta, Stanley Okoli, and Douglas J. Curlew ) for defendants.
Miller & Tischler, PC (by Sean F. Kelly ) for plaintiff.
Cummings, McClorey, Davis & Acho, PLC, Livonia (by Jacklyn P. Paletta, Stanley Okoli, and Douglas J. Curlew ) for defendants.
Before: Riordan, P.J., and M. J. Kelly and Shapiro, JJ.
M. J. Kelly, J. Plaintiff, Michigan Head & Spine Institute PC, appeals by right the trial court order granting summary disposition to defendants Auto-Owners Insurance Company and Home-Owners Insurance Company. For the reasons stated in this opinion, we reverse and remand for further proceedings. I. BASIC FACTS
This appeal arises from Michigan Head & Spine's claim for no-fault insurance benefits from Auto-Owners and Home-Owners for healthcare services provided to 39 individuals between June 11, 2019 and May 8, 2020. Michigan Head & Spine alleged that although it submitted reasonable proof of the fact and amount of each loss, and although it repeatedly requested full payment of the outstanding charges, Auto-Owners and Home-Owners unreasonably withheld or delayed full payment. Relevant to the issue raised on appeal, Michigan Head & Spine alleged that jurisdiction lay with the circuit court because the amount in controversy exceeded $25,000. In support of that allegation, it submitted documentation showing that the unpaid balance of the 39 individuals’ accounts was more than $200,000.
Auto-Owners and Home-Owners moved for summary disposition under MCR 2.116(C)(8) and MCR 2.116(C)(10). They stressed that the individual patients named in the complaint were involved in separate motor vehicle crashes that occurred on different dates and at different locations and that resulted in varying treatments. They contended that the only commonality between the patients was their purported treatment at Michigan Head & Spine. In addition, they argued that the reason for nonpayment or reduced payment on the claims listed in the complaint varied, noting that some of the reasons were that Michigan Head & Spine billed at an unreasonable rate, that the treatment billed for was unrelated to the relevant motor vehicle crashes, that there was insufficient information in the invoices submitted, and that there were attempted double billings for the same procedures. Finally, they noted that although each patient was insured by either Auto-Owners or Home-Owners, none was insured by both. Relevant to this appeal, Auto-Owners and Home-Owners argued that Michigan Head & Spine could not aggregate 39 "completely different claims" to meet the jurisdictional threshold of $25,000. The trial court agreed and dismissed all 39 claims for lack of subject-matter jurisdiction.
II. SUBJECT-MATTER JURISDICTION
A. STANDARD OF REVIEW
Michigan Head & Spine argues that the circuit court erred by granting summary disposition. We review de novo a trial court's decision on 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). "Whether a trial court has subject-matter jurisdiction is a question of law that this Court reviews de novo." Citizens for Common Sense in Gov't v. Attorney General , 243 Mich.App. 43, 49-50, 620 N.W.2d 546 (2000). Summary disposition under MCR 2.116(C)(4) is proper if the court lacks jurisdiction over the presented subject matter. Packowski v United Food & Commercial Workers Local 951 , 289 Mich.App. 132, 138, 796 N.W.2d 94 (2010). In reviewing a motion under MCR 2.116(C)(4), we examine whether the pleadings, affidavits, depositions, admissions, and documents in the case show that the trial court lacked subject-matter jurisdiction. Id. at 139, 796 N.W.2d 94.
Although the motion for summary disposition was brought under MCR 2.116(C)(8) and (C)(10), defendants argued that the circuit court lacked subject-matter jurisdiction and the circuit court agreed. "[W]here a party brings a summary-disposition motion under the wrong subrule, the trial court may proceed under the appropriate rule so long as neither party is misled." Blair v. Checker Cab Co , 219 Mich.App. 667, 670-671, 558 N.W.2d 439 (1996). Therefore, we consider this motion under MCR 2.116(C)(4), which requires the trial court to grant summary disposition if it lacks subject-matter jurisdiction.
B. ANALYSIS
Circuit courts are courts of general jurisdiction that have original jurisdiction to hear and decide all civil claims and remedies "except where exclusive jurisdiction is given in the constitution or by statute to some other court ...." MCL 600.605 ; Manning v. Amerman , 229 Mich.App. 608, 610-611, 582 N.W.2d 539 (1998). Under MCL 600.8301(1), "[t]he district court has exclusive jurisdiction in civil actions when the amount in controversy does not exceed $25,000.00." Although MCL 600.8301(1) is silent as to how the "amount in controversy" should be determined, our Supreme Court held that, absent bad faith in the pleadings, the amount in controversy is determined from the prayer for relief in the plaintiff's pleadings. Hodge v. State Farm Mut. Auto. Ins. Co. , 499 Mich. 211, 223-224, 884 N.W.2d 238 (2016). In its complaint, Michigan Head & Spine alleged that the amount in controversy exceeded $25,000, and there is no evidence indicating that the pleading was done in bad faith. Therefore, under Hodge , the jurisdictional threshold for an action before the circuit court is satisfied.
The circuit court, however, held that under Boyd v. Nelson Credit Ctrs. Inc. , 132 Mich.App. 774, 348 N.W.2d 25 (1984), Michigan Head & Spine could not aggregate multiple claims of multiple patients to meet the circuit court's jurisdictional threshold. In doing so, the circuit court misapplied the holding from Boyd . In Boyd , this Court held that the separate claims of individual plaintiffs may not be aggregated for the purposes of determining jurisdiction. Id. at 780-781, 348 N.W.2d 25. But it also recognized that the various claims of a single plaintiff may be aggregated. Id. at 781, 348 N.W.2d 25. Here, although Michigan Head & Spine has 39 individual claims based on treatment it provided to 39 separate patients, Michigan Head & Spine is indisputably a single plaintiff attempting to aggregate its various claims. As a result, applying the rule from Boyd , Michigan Head & Spine may aggregate its various claims for the purposes of determining jurisdiction.
The circuit court also relied upon this Court's decision in Priority Patient Transp LLC v. Farmers Ins Exch , unpublished per curiam opinion of the Court of Appeals, issued May 2, 2017 (Docket No. 329420), 2017 WL 1787441. Unpublished decisions of this Court are not binding, MCR 7.215(C)(1), but they can be "instructive or persuasive," Paris Meadows, LLC v. Kentwood , 287 Mich.App. 136, 145 n 3, 783 N.W.2d 133 (2010). In Priority Patient , a single plaintiff filed suit against the defendant alleging that the defendant had "failed to tender personal injury protection (PIP) benefits for the medical transportation of 14 separate individuals in violation of the no-fault act ...." Priority Patient , unpub. op. at 1. The Priority Patient Court correctly noted that Boyd held that, absent a class action, multiple plaintiffs could not aggregate multiple claims to meet the jurisdictional threshold of the circuit court. Id. at 3. The Court also recognized a single plaintiff with multiple claims could aggregate those claims to meet or exceed the amount-in-controversy jurisdictional requirement. Id ., citing Moody v. Home Owners Ins Co , 304 Mich.App. 415, 849 N.W.2d 31 (2014), rev'd on other grounds by Hodge , 499 Mich. 211, 884 N.W.2d 238. Yet, despite citing caselaw that expressly permits a single plaintiff to aggregate its various claims to reach the jurisdictional threshold, the Priority Patient Court concluded that the single plaintiff could not aggregate its 14 claims against the defendant to reach the jurisdictional threshold because to do so would be to "subvert" the rule in Boyd . Priority Patient , unpub. op. at 4. The rationale in Priority Patient is unpersuasive. The opinion simultaneously acknowledges that a single plaintiff may aggregate its various claims to meet or exceed the jurisdictional limits of the circuit court and then immediately precludes a single plaintiff from taking that permissible action. Given the logical dissonance, we decline to find Priority Patient either instructive or persuasive.
Ostensibly, the Priority Patient Court was concerned that the plaintiff was aggregating the separate claims of 14 separate plaintiffs into a single action, which would be impermissible under Boyd . Joinder of claims, however, is governed by MCR 2.203, whereas the determination of whether the amount in controversy has been sufficiently pleaded is determined by referring to the pleadings, Hodge , 499 Mich. at 223-224, 884 N.W.2d 238. As a result, whether claims are properly joined is an issue separate, but related to whether a plaintiff may aggregate its properly joined claims to reach the jurisdictional limits of the circuit court. III. CONCLUSION
In the proceedings before the circuit court, defendants argued that under MCR 2.206, Michigan Head & Spine improperly joined the claims of multiple plaintiffs. The trial court expressly declined to address defendants’ joinder argument. Yet that claim is entirely without merit. Because the claims arose on or after June 11, 2019, Michigan Head & Spine has a direct claim or cause of action against defendants. See MCL 500.3112, as amended by 2019 PA 21. Therefore, contrary to defendants’ arguments below, Michigan Head & Spine did not attempt to permissively join the claims of 39 separate plaintiffs under MCR 2.206(A).
Additionally, although the parties dispute whether Michigan Head & Spine must or may join all of its claims against defendants pursuant to MCR 2.203, that issue was not decided by the trial court. We may overlook preservation requirements when deciding an issue is necessary for a proper determination of the case, particularly if the issue is one of law and the necessary facts have been presented, Jawad A Shah MD, PC v State Farm Mut. Auto. Ins. Co. , 324 Mich.App. 182, 192-193, 920 N.W.2d 148 (2018) ; however, we decline to do so here. Unlike defendants’ argument that joinder was improper under MCR 2.206, the facts necessary to determine whether the claims are properly joined under MCR 2.203 are not presently before this Court. Nor were those facts available to the trial court as the motion to dismiss was filed before the issuance of a scheduling order or any discovery, and the court's ruling was issued shortly thereafter. In its briefing, Michigan Head & Spine asserts that the claims all raise the common issue of whether the charges for their services were reasonable while defendants’ briefing denies that assertion and argues that there are multiple other issues relevant to some of the claims that would justify severance of some of the cases. However, the record requires further development through discovery before the accuracy of those representations can be determined so as to allow the court to rule on a motion for severance.
Under Hodge , the amount in controversy is determined by referring to the pleadings. Id. Under Boyd , a single plaintiff may aggregate its various claims to satisfy the jurisdictional limits of the circuit court. Here, although Michigan Head & Spine has 39 separate claims, it is still just a single plaintiff aggregating its various claims. Therefore, under Hodge and Boyd , it may aggregate all of its various claims to reach the jurisdictional threshold of the circuit court. The trial court erred by holding otherwise.
Given our resolution, we do not address Michigan Head & Spine's alternate argument that the circuit court erred by dismissing its claims instead of removing them to the appropriate district courts.
Reversed and remanded for further proceedings. We do not retain jurisdiction. Michigan Head & Spine may tax costs as the prevailing party. MCR 7.219(A).
Shapiro, J., concurred with M. J. Kelly, J.
Riordan, P.J. (dissenting).
I respectfully dissent.
Plaintiff, Michigan Head & Spine Institute PC, sued defendant Auto-Owners Insurance Company and defendant Home-Owners Insurance Company—apparently two unrelated entities—for no-fault benefits under the no-fault act, MCL 500.3101 et seq. , for healthcare services that it provided to 39 patients. There is nothing in the complaint to suggest that the claims for these 39 patients are connected in any respect beyond the allegation that "DEFENDANTS are the No-Fault insurers that are responsible to pay No-Fault benefits to or for the benefit of the patients." In other words, the complaint indicates that plaintiff sought to aggregate unrelated patient claims against two unrelated defendants to satisfy the jurisdictional minimum of the circuit court. As the majority correctly states, "our Supreme Court held that, absent bad faith in the pleadings, the amount in controversy is determined from the prayer for relief in the plaintiff's pleadings." See Hodge v. State Farm Mut Auto Ins Co , 499 Mich. 211, 223-224, 884 N.W.2d 238 (2016) ("[I]n its subject-matter jurisdiction inquiry, a district court determines the amount in controversy using the prayer for relief set forth in the plaintiff's pleadings, calculated exclusive of fees, costs, and interest."). The prayer for relief in the instant pleading includes no particular amount in controversy or other monetary amount, so for this reason alone I question whether the jurisdiction of the circuit court was properly invoked.
MCL 600.605 provides that "[c]ircuit courts have original jurisdiction to hear and determine all civil claims and remedies, except where exclusive jurisdiction is given ... by statute to some other court ...." And, MCL 600.8301(1) provides that "[t]he district court has exclusive jurisdiction in civil actions when the amount in controversy does not exceed $25,000.00." Thus, the circuit court has jurisdiction over cases in which the amount in controversy exceeds $25,000. Here, the complaint itself does not expressly state that aggregation of the claims is necessary to satisfy the jurisdictional minimum of the circuit court. However, the parties do not dispute that such aggregation is necessary, particularly when an attached exhibit to the complaint indicates that only one claim for patient services would satisfy the jurisdictional minimum.
See also Hodge , 499 Mich. at 224, 884 N.W.2d 238 ("[T]he prayer for relief controls when determining the amount in controversy and the limit of awardable damages.").
I acknowledge that the pleading summarily alleges elsewhere that "[j]urisdiction is proper in [the circuit court], because the amount in controversy is more than $25,000.00." Assuming that the entire pleading, and not simply the prayer for relief, is the measure of jurisdiction—a necessary assumption implicit within the majority opinion—I would still conclude that the circuit court lacked jurisdiction over this case.
In Boyd v. Nelson Credit Ctrs. , 132 Mich.App. 774, 348 N.W.2d 25 (1984), this Court explained that aggregation of "the separate claims of individual plaintiffs" is "not permitted to establish the jurisdictional minimum...." Id. at 780-781, 348 N.W.2d 25. However, this Court added that "aggregation of various claims of a single plaintiff" is permitted to establish the jurisdictional minimum. Id. at 781, 348 N.W.2d 25. The majority here concludes that the latter principle applies because "although Michigan Head & Spine has 39 individual claims based on treatment it provided to 39 separate patients, Michigan Head & Spine is indisputably a single plaintiff attempting to aggregate its various claims." I respectfully disagree.
"Although published opinions of this Court decided before November 1, 1990, are not strictly binding, MCR 7.215(J)(1), they are nevertheless precedential, MCR 7.215(C)(2), and they are thus afforded significantly more deference than would be given to unpublished cases." People v. Spaulding , 332 Mich.App. 638, 657 n. 5, 957 N.W.2d 843 (2020).
That conclusion, in my view, is inconsistent with Moody v. Home Owners Ins Co , 304 Mich.App. 415, 849 N.W.2d 31 (2014), rev'd sub nom Hodge , 499 Mich. 211, 884 N.W.2d 238, which specifically addressed determining the amount in controversy in no-fault actions. Moody explained that in no-fault actions, a healthcare provider's claim against a no-fault insurer is derivative of the patient's underlying claim, such that when a single patient sues a no-fault insurer to recover no-fault benefits for services received from multiple healthcare providers, "the consolidated claims are the equivalent of a single plaintiff asserting multiple claims against a single defendant." Moody , 304 Mich.App. at 443, 849 N.W.2d 31. Thus, in no-fault actions, the Boyd principle—i.e., that "aggregation of various claims of a single plaintiff" is permitted to establish the jurisdictional minimum—applies when the "single plaintiff" at issue is the patient , not the healthcare provider. Boyd , 132 Mich. App. at 781, 348 N.W.2d 25. There is nothing in Moody to suggest that the inverse is true as well, i.e., that a single healthcare provider may aggregate the various claims of multiple patients to establish the jurisdictional minimum. This is for good reason: because the healthcare provider's claim is derivative of the patient's claim, id. at 441, 849 N.W.2d 31, a single healthcare provider bringing claims against a no-fault insurer for multiple patients is, in essence, bringing "the separate claims of individual plaintiffs," contrary to Boyd , 132 Mich.App. at 780-781, 348 N.W.2d 25.
Hodge reversed the holding in Moody that the district court may be "divested of jurisdiction when the pretrial discovery answers, the arguments of plaintiff's counsel before trial and the presentation of evidence at trial pointed to damages in excess of $25,000," notwithstanding that the complaint itself alleged damages not exceeding $25,000. Hodge , 499 Mich. at 214-215, 884 N.W.2d 238 (cleaned up). Hodge did not reverse other holdings in Moody .
Simply put, a no-fault action is materially distinguishable from the ordinary case in which a single plaintiff seeks to aggregate multiple, if unrelated, claims against a single defendant to satisfy the jurisdictional minimum of the circuit court. In that case, the majority is correct that aggregation of claims is a question of permissive joinder under MCR 2.203(B), not a threshold question of subject-matter jurisdiction determined from the pleadings alone. But a no-fault action, in contrast, presents an unusual case in which the amount in controversy for the purposes of subject-matter jurisdiction is determined by identifying the amount in controversy alleged with respect to a single patient. See Moody , 304 Mich App at 443, 849 N.W.2d 31. Again, because a healthcare provider's claim against a no-fault insurer is derivative of the patient's underlying claim, a healthcare provider bringing claims against no-fault insurers for multiple patients based on multiple and presumably distinguishable insurance policies, essentially is bringing the claims of multiple plaintiffs.
Subsequent developments in the law do not obviate this aspect of Moody . In 2017, our Supreme Court held that neither MCL 500.3112 nor any other provision of the no-fault act "bestow[s] on a healthcare provider a statutory right to directly sue no-fault insurers for recovery of no-fault benefits." Covenant Med. Ctr., Inc v. State Farm Mut. Auto. Ins. Co. , 500 Mich. 191, 196, 895 N.W.2d 490 (2017). In so holding, Covenant overruled a series of our decisions holding that healthcare providers did possess such a statutory right. See, e.g., Moody , 304 Mich.App. 415, 849 N.W.2d 31 ; Mich. Head & Spine Institute, P.C. v. State Farm Mut. Auto. Ins. Co. , 299 Mich.App. 442, 830 N.W.2d 781 (2013) ; Regents of the Univ. of Mich. v. State Farm Mut. Ins. Co. , 250 Mich.App. 719, 650 N.W.2d 129 (2002). In response to Covenant , the Legislature amended MCL 500.3112(1), effective June 11, 2019, to provide that a healthcare provider "may make a claim and assert a direct cause of action against an insurer ... to recover overdue benefits payable for charges for products, services, or accommodations provided to an injured person." See MCL 500.3112, as amended by 2019 PA 21. This amendment of MCL 500.3112 therefore revived the holdings in cases such as Moody that healthcare providers have claims against no-fault insurers "completely derivative of and dependent on" the underlying claims of the patients themselves. Moody , 304 Mich.App. at 440, 849 N.W.2d 31. See People v. Williams , 491 Mich. 164, 177, 814 N.W.2d 270 (2012) (noting that statutory amendments in response to judicial decisions should be interpreted in light of those decisions).
See also Regents of the Univ. of Mich. , 250 Mich.App. at 733, 650 N.W.2d 129 ("Although [the healthcare providers] may have derivative claims, they also have direct claims for personal protection insurance benefits."); Wyoming Chiropractic Health Clinic, PC v. Auto-Owners Ins Co , 308 Mich.App. 389, 395, 864 N.W.2d 598 (2014) (same), overruled by Covenant Med. Ctr., Inc. , 500 Mich. 191, 895 N.W.2d 490.
Accordingly, while the majority is correct that ordinarily a single plaintiff may aggregate multiple, unrelated claims against a single defendant to satisfy the jurisdictional minimum of the circuit court, see Boyd , 132 Mich.App. at 781, 348 N.W.2d 25, that is not the case before us. Instead, the case before us concerns a single healthcare provider seeking to aggregate the claims of multiple, unrelated plaintiffs against two apparently unrelated defendants to satisfy the jurisdictional minimum of the circuit court. In my view, Moody precludes plaintiff here from doing so. Therefore, I respectfully dissent and would affirm the trial court's dismissal of this case for lack of subject-matter jurisdiction.
Although not necessary for resolution of this case, I respectfully disagree with the majority's very cursory analysis, and inverted reasoning, of Priority Patient Transp., LLC v. Farmers Ins Exch , unpublished per curiam opinion of the Court of Appeals, issued May 2, 2017 (Docket No. 329420), 2017 WL 1787441. Resolution of that case was premised on Moody ’s discussion of derivative claims in the no-fault context. That is, Priority Patient did not treat the healthcare provider as a "single plaintiff" for the purposes of Boyd because Moody indicated that the healthcare provider was essentially multiple plaintiffs for the purposes of Boyd . Priority Patient correctly recognized that in Moody , there were three claims arising from a single insurance policy emanating from the same, single incident, which is quite the opposite of the fact pattern before us. Even if Moody is no longer valid law on that point, Priority Patient was nonetheless correct to rely on Moody at the time it was decided because Covenant had not yet been decided by our Supreme Court and MCL 500.3112(1) had not yet been amended by the Legislature.