Court of Appeals Issues Ruling Concerning Michigan Compensation Commission’s Discretion and Authority to Decide Coverage Disputes Between Carriers

The title of this blog does not do justice to the significance and complexity of this case, for many reasons. I presented oral argument in this case on December 6.  Today, I am in receipt of the attached opinion.  It is a well-written, highly detailed opinion concerning the discretion and authority of the Michigan Compensation Appellate Commission to determine, among other things, coverage obligations by and between carriers for an injury suffered by the employee of a subcontractor working at a location that was part of or attached to a larger mall construction project.

The attorney for the employer and State Farm, whose agent had been the issuer of State Farm policies covering the employer, M.D. Plumbing, argued that an Amerisure policy was provided and covered the loss rather than a State Farm policy.  The Court holds that the Commission’s denial of State Farm’s December 1, 2010 motion to effectuate the Commission’s earlier order of March 19, 2004 to re-open the record and allow State Farm to present additional evidence concerning the existence of an Amerisure policy was not an abuse of discretion.

The Court concludes that State Farm abandoned the issue and failed to appeal it.  “Having neglected to pursue the issue during the six years when the matter bounced between the WCAC, the board of magistrates, and this Court, State Farm’s contention that the WCAC abused its discretion in failing to grant its motion in 2010 is not persuasive.”  Slip Op. at 6.

The Court also concludes that the Commission’s denial of State Farm’s delayed appeal from its 2010 order was also not an abuse of discretion; “the length of the delay was more than a decade.”  The Court rejected State Farm’s stated reason for the delay; that the issue regarding potential coverage by other carriers remained “moot” until the Court of Appeals in 2010 ruled on the applicability of the St. Paul “wrap-up” policy.  The Court explained that St. Paul’s “apparent” liability did not render moot issues involving the potential liability of another carrier.  Finally, the Court notes “[w]ith respect to prejudice, State Farm’s delay affected the ability of the board of magistrates, the WCAC, and the parties, to promptly and efficiently dispose of the matter.”  Id. at 7.

The Court of Appeals decision further concludes that the Commission correctly held, on remand, that the St. Paul “wrap-up” policy covering the mall project also did not provide coverage for Mr. Chase’s injury.  In short, this leaves State Farm responsible to provide coverage on the basis of the actions of the “exclusive agent for State Farm Insurance.”  Slip Op. at 5.  The Court remands for a determination of W.J. O’Neil and Argonaut’s entitlement to reimbursement and interest from State Farm for payments they made covering the loss.

I will not comment further at this point as there is likely to be subsequent activity in this case.  The opinion, again, however, is informative.

Chase v. Terra Nova

About cjtucker06

Owner of law firm since July 2014; Handles all types of appellate matters and assists other lawyers with complex litigation and insurance coverage issues; Admitted to the Supreme Court of the United States, the Sixth Circuit Court of Appeals and the State Bar of Michigan; Expertise in prosecuting and defending appeals with several significant successes in the Sixth Circuit Court of Appeals, the Michigan Supreme Court and the Michigan Court of Appeals; Author of briefs amicus curiae in the Michigan Supreme Court for the Michigan Defense Trial Counsel and the Insurance Institute of Michigan; Represents Insurance Companies, Major International Business, Governmental Entities, Law Enforcement Officers and County Sheriffs. Board of Directors, Michigan Defense Trial Counsel Amicus Committee Co-Chair, Michigan Defense Trial Counsel Military - Retired Major in the Judge Advocate General (JAG) Corps of the United States Army, Brigade Judge Advocate and Staff JAG officer for the Maneuver Training Center, Camp Grayling, Michigan; Recipient of the Army's Meritorious Service Medal (the highest medal of honor available to Soldiers serving in non-combat roles); 2012 Graduate of the Judge Advocate Officer Advanced Course, at The Judge Advocate Legal Center and School, Charlottesville, Virginia. United States Navy Reserves, Combat Warfare Qualification, January 1989 to July 2003 Former law clerk to Justice Stephen J. Markman, Michigan Supreme Court, Research Attorney, Michigan Court of Appeals. Insurance Coverage Associate Plunkett Cooney; Environmental Law Attorney at Squire Sanders, now Squire Patton Boggs; Master's Degree in Environmental Law; Environmental Law Scholar, ALI/ABA Washington, D.C., Juris Doctorate, Vermont Law School, Environmental Editor, Vermont Law Review; Treasurer and Finalist, Moot Court Advisory Board.
Gallery | This entry was posted in May It Please the Court, Michigan Court of Appeals Unpublished Opinions, Recent Judicial Dispositions, Workers' Compensation Cases. Bookmark the permalink.

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