In Hannay v. Department of Transportation, an important ruling for auto accident victims, the Michigan Supreme Court clarifies government is liable for pain & suffering and excessive wage loss caused by a negligent government driver
Just like anyone else, the government is liable for an auto accident victim’s pain and suffering and the excess wage loss caused by a governmental employee’s negligent driving. Sounds like a pretty common sense idea, right?
Well, until recently, it wasn’t.
Some – especially the State of Michigan – were arguing governmental immunity was so broad that, even in car crash situations where immunity didn’t fully shield the government from liability, government couldn’t be held liable for certain damages.
… unlike all other drivers whose negligence has caused people to suffer serious injury or death.
Clinging to a distorted interpretation of the motor vehicle exception to governmental immunity – which imposes liability on the government “for bodily injury” caused by the “negligent operation” of a motor vehicle by a government employee – it was insisted that “bodily injury” didn’t include pain and suffering compensation and damages for excess wage loss under the No Fault Law.
Thankfully, a unanimous Michigan Supreme Court disagreed.
At long last and after much confusion in the lower courts, the justices have finally laid to rest this absurd argument.
In our case, Hannay v. Department of Transportation and in its companion case, Hunter v. Sisco, the Supreme Court ruled as follows:
“We conclude that the phrase ‘liable for bodily injury’ contained in the motor vehicle exception means legally responsible for damages flowing from a physical or corporeal injury to the body. More simply, ‘bodily injury’ is merely the category of harm for which governmental immunity from tort liability is waived under MCL 691.1405 [motor vehicle exception] and for which damages that naturally flow are compensable.”
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“We therefore hold that a plaintiff may bring a third-party tort action for economic damages, such as work-loss damages, and noneconomic damages, such as pain and suffering or emotional distress damages [caused by a “serious impairment of body function”], against a governmental entity [under the motor vehicle exception to governmental immunity] …”
This was a critical ruling for Michigan auto accident victims, because without it, those victims who had the bad fortune of being injured by a government driver would have been denied essential and necessary compensation and benefits.
Unfortunately, as important as this case was in terms of clarifying the scope of liability under the motor vehicle exception to governmental immunity, it did not result in the relief that plaintiff Heather Hannay – who was represented at trial by Michigan Auto Law – was seeking and was entitled to.
Although the justices ruled that Ms. Hannay could recover pain and suffering compensation, they concluded there was insufficient evidence to support her claim for excess wage loss benefits.
Serious impairment of body function
The Supreme Court noted that, although a claim for pain and suffering compensation (also known as non-economic loss damages) can be brought under the “bodily injury” provision in the motor vehicle exception, the claim must still satisfy the No Fault Law’s “serious impairment of body function” threshold for suing for pain and suffering:
“[T]he restrictions on damages recoverable in third-party tort actions involving motor vehicle accidents set forth in MCL 500.3135 [“serious impairment of body function” threshold] of the no-fault act, MCL 500.3101 et seq., apply to cases permitted by the waiver of governmental immunity provided for in the motor vehicle exception.”
No Fault wage loss benefits
Under the Michigan No Fault Law, auto accident victims are entitled to recover No Fault wage loss benefits to cover the wages they’re unable to earn because their crash-related injuries have disabled them from working.
No Fault wage loss benefits are recoverable regardless of who was at-fault in causing the accident and, generally, they can be collected for three years after the accident.
However, if an auto accident victim can show that another driver was at-fault in causing the crash, then the victim can sue for “excess” wage loss benefits.
These – in addition to pain and suffering compensation – are the benefits that the Supreme Court in Hannay/Hunter said were recoverable under the motor vehicle exception to governmental immunity.