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Michigan auto accident victims can recover excess wage loss benefits from government vehicles that cause crashes

February 15, 2013 by Steven M. Gursten

Michigan Auto Law recovered the top truck accident trial verdict last year in 2011, and now the Michigan Court of Appeals has affirmed the verdict. But in doing so, the Court also clarified an area of our law that can effect hundreds of people injured in motor vehicle accidents with government owned vehicles.

The ruling allows Michigan auto accident victims to recover excess No Fault wage loss benefits from governmental entities that cause a motor vehicle accident.  The Michigan Court of Appeals case is Hannay v. Department of Transportation, a published opinion.

In reaching its unanimous conclusion in Hannay, the Court of Appeals panel of judges rejected the argument that governmental immunity shields governmental agencies from liability for auto accident-related excess wage loss benefits.

Additionally, the judges concluded that a dental assistant’s No Fault wage loss benefits could be calculated on the basis of wages she would have earned in the future once she had completed training to become a dental hygienist.

Heather Lynn Hannay v. MDOT

Heather Lynn Hannay, a dental assistant, suffered a serious shoulder injury (requiring four shoulder surgeries and, possibly, a fifth upcoming shoulder surgery) and suffered chronic pain after an MDOT salt truck failed to stop at a stop sign and crashed into the vehicle Ms. Hannay was driving.

As a result of a lawsuit filed by Ms. Hannay, a trial judge ruled that MDOT owed Ms. Hannay for excess wage loss, i.e., wage loss benefits lasting beyond three years after the accident.

The MDOT disagreed and filed an appeal with the Michigan Court of Appeals.

Excess Wage Loss Benefits

Under Michigan’s No Fault Law, a seriously injured auto accident victim is entitled to recover No Fault “wage loss” or “work loss” benefits “consisting of loss of income from work an injured person would have performed during the first three years after the date of the accident if he or she had not been injured.” (MCL 500.3107(1)(b))

As with other No Fault benefits, an accident victim can recover wage loss benefits “without regard to fault,” i.e., regardless of whether the victim or another driver was at fault in causing the accident.  (MCL 500.3105(2))

Generally, an accident victim’s ability to recover wage loss benefits is limited in two ways:

  1. Wage loss benefits are available only for the first three-years following the accident; and,
  2. There is a monthly maximum on the amount of wage loss benefits that an accident victim can recover. (MCL 500.3107(1)(b))

However,  if an auto accident victim can show that someone other than herself was at fault in  causing the accident, then she may be able to sue to recover excess wage loss benefits, i.e.,        “[d]amages for … work loss … in excess of the … monthly … and three-year limitations …” (MCL 500.3135(3)(c))

No governmental immunity from excess wage loss

Although a governmental agency is generally immune under  the Michigan Governmental Tort Liability Act (GTLA) from tort liability for personal injuries resulting from the agency’s negligence, there is a “motor vehicle” exception to governmental immunity which exists for “bodily injury and property damage” caused by the agency’s negligent operation of a vehicle. (MCL 691.1405)

The Court of Appeals concluded that excess wage loss damages triggered the motor vehicle exception to governmental immunity because they were the type of “damages that arise from the bodily injuries …”

Calculating wage loss benefits based on future wages

At the time of the truck accident, Ms. Hannay worked as a “dental assistant” for a dentist. However, she was also enrolled in and actively attending classes at Lansing Community College with the intent of entering the school’s “dental hygienist program.”

In seeking excess wage loss benefits under the No Fault Law, Ms. Hannay contended that her wage loss benefits should be calculated on the basis of the wages she would have eventually earned as a dental hygienist.

The trial court agreed and so did the Court of Appeals:

“The trial court found that, but for the accident, plaintiff would have been accepted into LCC’s dental hygienist program, would have graduated, and would have been employed, at least 60 percent of the time, by a specific dental office at a rate of $28 an hour. The trial court’s findings are supported by the testimony of plaintiff, the dentist who owns the dental office, an expert on financial modeling, and a dental hygienist employed at the dental office, as well as evidence regarding plaintiff’s qualifications and LCC’s admission standards. Under these circumstances, we cannot conclude that the trial court’s damages award was purely speculative. Thus, we conclude that the trial court’s award for lost wages was not clearly erroneous.”

This is an important ruling for our client. In winning the ruling, Michigan Auto Law attorneys have helped clarify a disputed area of law that can help hundreds of Michigan citizens who are seriously injured by government-owned vehicles in the years to come.

Related Information:

More information about the Hannay verdict in Ingham County



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