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No more nitpicking of ‘notice of injury’ to deny No Fault insurance benefits

MI Court Of Appeals Rules in Dillon v. State Farm: ‘notice of injury’ need not ‘identify the specific injury’ for which an auto accident victim is seeking coverage

notice of car accident injuries in No Fault, image

For years, Michigan auto insurance companies such as State Farm, AAA and Allstate have been nitpicking auto accident victims’ “notice of injury” filings in order to avoid paying No Fault benefits.

No more – thanks to a well-reasoned (and very long-overdue) published ruling from the Michigan Court of Appeals.

Until now, auto insurers and personal injury lawyers have been playing a high-stakes game of “gotcha.” A claims adjuster from an injured person’s No Fault auto insurance company will scour a victim’s application for benefits for “notice of injury,” which must be legally filed within a year of an accident, to see if any of the injuries for which the victim is now seeking treatment are not listed in the notice.

Meanwhile, lawyers like me would nervously wonder if accident victims had put every conceivable injury down in their application for benefits in the early days after their car accidents before they ever retained a lawyer. We would worry if they did not, that one day this could be used to deny a claim. And as a number of my own auto accident lawsuits are referred to me from other Michigan lawyers, I would always nervously wonder if these lawyers had made sure the clients had filled out the No Fault application for benefits to include every  possible injury, because insurance company defense lawyers and claims adjusters were increasingly emboldened by two terribly reasoned unpublished appellate cases (see below) to challenge and withhold payment for many injuries.

During my 20 years as an attorney helping auto accident victims in Michigan, I’ve seen this “game” play out with tragic results far too many times. This is especially true with survivors of traumatic brain injuries, and people who suffered serious neck and back injuries that would get progressively worse and start causing radiating pain or numbness going down legs or arms.

But thankfully, the Michigan Court of Appeals, in Dillon v. State Farm Mutual Automobile Insurance Company, has finally seen this game of “gotcha” for what it is: An illogical argument that’s completely unsupported by the Michigan No Fault Law.

Specifically, in Dillon, the court rejected the auto insurers’ “nitpicking” strategy, explaining:

As for whether “a notice of injury … under MCL 500.3145(1) … must identify the specific injury for which the insured later seeks coverage …, [w]e hold that it does not.”

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“The fact that the Legislature omitted … use [of “[t]he definite article ‘the’”] before the word ‘injury’ in ‘notice of injury’ indicates that the Legislature was not referring to a definite or particular injury. That is, if the Legislature intended for the ‘notice of injury’ to identify a very specific injury, such as an injury to the left hip, rather than the mere fact that an accident resulted in some injury, it would have provided that ‘notice of the injury’ must be given.”

Dillon v. State Farm Mutual Automobile Insurance Company

Jessica Dillon was injured in August 2008 as a pedestrian when a car struck her as she was crossing the street. At the time, she complained only of injuries to her lower back and shoulder.

Starting in 2011, Ms. Dillon began receiving medical treatment for a hip injury that she believed was related to the 2008 accident. When she sought to have her hip treatment covered by No Fault, State Farm refused claim “that it had not received notice of the hip injury within one year of the accident.”

Noting that State Farm “points to no published decision of this Court or the Supreme Court that clearly resolves this question,” the Court of Appeals ruled that the statutory language prevents State Farm from denying benefits:

  • “[W]e reject defendant’s argument that the notice of injury must have specified injury to plaintiff’s left hip. The fact that they received notice that she suffered physical injuries in a motor vehicle accident was sufficient to satisfy the statute.”
  • “In conclusion, because plaintiff gave notice of injury within one year of the accident, §3145(1) allows her to recover personal protection insurance benefits for any loss incurred within one year of the commencement of the action.”

Unwarranted focus on the ‘specific’ personal injury

Dillon makes medical sense, in that lay people are not doctors and there are some injuries – such as a general “low back” injury, could clearly impact and encapsulate an adjacent part of the body as close to the back as the hip does in Jessica’s case. It is also a sensible ruling that dismisses the overly narrow and strict interpretation of the No Fault law that auto insurers have been using for years to deny justice to injured auto accident victims.

Inexplicably, this argument has received limited support in some Court of Appeals opinions (which were unpublished and, thus, without precedential value):

  • In Ross v. Allstate Insurance Company, the Court of Appeals said an auto insurer could deny No Fault benefits because the auto accident victim hadn’t listed traumatic brain injury in her “notice of injury” – rationalizing that “Michigan courts have consistently held that providing notice of an injury is insufficient to provide the insurer with a basis for evaluation of a claim. A claim for specific benefits must be submitted.”
  • In Cunningham v. Auto-Owners Insurance Company, the Court of Appeals ruled that an auto accident was legally denied No Fault benefits “because there is no evidence that plaintiff notified defendant within one year of the accident of his closed-head injury.”

‘Notice of injury’ requirements under Michigan’s auto No Fault law

Under Michigan’s No Fault Law, a lawsuit for unpaid No Fault auto insurance benefits “for accidental bodily injury” must be started within “1 year after the date of the [auto] accident causing the injury unless …”:

“[W]ritten notice of injury … has been given to the insurer within 1 year after the accident …” (MCL 500.3145(1))

The “notice of injury” must include “the name and address of the claimant and indicate in ordinary language the name of the person injured and the time, place and nature of his injury.”

So long as the “written notice of injury” is given to the auto insurance company within a year of the accident, a lawsuit for unpaid No Fault benefits can “be commenced at any time within 1 year after the most recent allowable expense, work loss or survivor’s loss has been incurred.”

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