TIMOTHY WARD V TITAN INS CO
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STATE OF MICHIGAN
COURT OF APPEALS
TIMOTHY WARD,
FOR PUBLICATION
Plaintiff-Appellant/Cross-Appellee,
v
No. 284994
Kent Circuit Court
LC No. 04-006032-NF
TITAN INSURANCE COMPANY,
Defendant-Appellee/CrossAppellant.
Advance Sheets Version
Before: SERVITTO, P.J., and BANDSTRA and MARKEY, JJ.
BANDSTRA, J.
Plaintiff appeals as of right the trial court’s denial of his request for work loss benefits,
penalty interest, and attorney fees. Defendant cross-appeals, arguing that the trial court
incorrectly awarded the full cost of plaintiff’s housing expenses. We reverse and remand.
We review a decision on a motion for summary disposition de novo. Coblentz v City of
Novi, 475 Mich 558, 567; 719 NW2d 73 (2006). We must review the record in the same manner
as the trial court to determine whether the movant was entitled to judgment as a matter of law.
Morales v Auto-Owners Ins Co, 458 Mich 288, 294; 582 NW2d 776 (1998). A motion under
MCR 2.116(C)(10) tests the factual sufficiency of the complaint. Maiden v Rozwood, 461 Mich
109, 120; 597 NW2d 817 (1999). Summary disposition is proper under MCR 2.116(C)(10)
where the proffered evidence fails to establish a genuine issue regarding any material fact and
the moving party is entitled to judgment as a matter of law. MCR 2.116(C)(10); MCR
2.116(G)(4); Coblentz, supra at 568, quoting Maiden, supra.
With respect to plaintiff’s first issue on appeal, MCL 500.3107(1)(b) provides that
personal protection insurance benefits are payable for “[w]ork loss consisting of loss of income
from work an injured person would have performed during the first 3 years after the date of the
accident if he or she had not been injured.” A plaintiff must suffer a loss of income to be entitled
to benefits under this section. Ross v Auto Club Group, 481 Mich 1, 12; 748 NW2d 552 (2008).
Claimants have the burden of proving the amount they would have earned had they not been
injured in the automobile accident. Popma v Auto Club Ins Ass’n, 446 Mich 460, 472-473; 521
NW2d 831 (1994). Independent contractors can recover work loss benefits because work loss
benefits include not only lost wages, but also lost profit, which is attributable to personal effort
and self-employment. Kirksey v Manitoba Pub Ins Corp, 191 Mich App 12, 17; 477 NW2d 442
(1991).
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Here, plaintiff’s deposition testimony that he was regularly employed at Club Tequila as
a bouncer at the time of his accidental injuries was corroborated by two fellow employees, Alvin
Bright and Larry Howard, as well as by an affidavit from the person plaintiff claimed had
employed him, Teion Crews. In response, defendant points out that the owner of Club Tequila
denied ever having plaintiff as an employee. However, Crews later gave sworn testimony that
plaintiff was an independent contractor rather than a direct employee. But, on the other hand, as
defendant also points out, Crews’ testimony also indicated that plaintiff did not work as often as
he claimed (and as Crews has previously averred) and, further, that plaintiff was not likely to
have continued on as a bouncer in any capacity as a result of plaintiff’s marijuana use.
Suffice it to say that this case was replete with factual questions surrounding plaintiff’s
employment at the time of the accident and thus his entitlement to wage loss benefits resulting
from the accident. How often plaintiff worked, what he earned, his prospects for continued
employment, whether he was an employee or an independent contractor and related questions are
best left to the fact-finder; they were not properly resolved against plaintiff through a summary
disposition order.
Defendant argues vociferously that plaintiff’s inability to produce documentation of his
employment should be dispositive, but with no precedential support for that proposition. We
find our dissenting colleague’s agreement with defendant to be based on a mistaken
understanding of the statutory scheme. MCL 500.3158(1) does require an employer to furnish a
sworn statement regarding the earnings of an injured person but nowhere does it state that, if
such information is not provided, an injured person completely loses the right to work loss
benefits under MCL 500.3107(1)(b).1 The dissent would penalize plaintiff for his former
employer’s failure to comply with MCL 500.3158 even though that statutory provision says
nothing about employees and only places a responsibility on employers. As the dissent contends,
under the facts and circumstances of this case, penalizing an employee for an employer’s failure
to produce a sworn statement might be appropriate. However, imposing such a penalty would be
a public policy decision for the Legislature, not the courts. Nowhere do the statutes suggest that
MCL 500.3158(1) is the only manner in which a wage loss claim may be proved or that the right
to a wage loss claim under 500.3107(1)(b) hinges on compliance with MCL 500.3158(1). We
are not free to read something into the statute that doesn’t exist, no matter how egregious the
facts may be.
Further, we note that, while plaintiff freely admitted at his deposition that the wages he
claimed he earned at Club Tequila were paid “under the table” and the record suggests that
plaintiff failed to properly file income tax returns regarding any income he earned, his claim
would not be barred under the wrongful conduct rule. Orzel v Scott Drug Co, 449 Mich 550,
558-559; 537 NW2d 208 (1995). That rule only bars a claim of a plaintiff “who founded his
cause of action on his own illegal conduct.” Id. at 559. Plaintiff’s claim here is not based upon
his failure to properly file income tax returns; it is based on his allegations of an automobile
1
Of course, the lack of earnings documentation is something for the fact-finder to consider in
weighing plaintiff’s work loss claim.
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accident and resulting work loss injuries. The wrongful conduct rule does not apply because
plaintiff’s alleged failure to file income tax returns would be only incidentally or collaterally
connected to his claim for work loss benefits. Id. at 564. Further, we note that the failure to file
federal tax returns is not listed as one of the reasons identified by the Legislature to deny a
person personal protection insurance benefits. See MCL 500.3113; Cervantes v Farm Bureau
Gen Ins Co, 272 Mich App 410, 418; 726 NW2d 73 (2006).
In sum, we agree with plaintiff that factual questions existed with respect to his wage loss
claim. The trial court improperly granted defendant summary disposition on that claim.
Turning next to defendant’s cross-appeal, we further conclude that the trial court erred by
awarding plaintiff housing costs based on the full amount he currently pays for rent. This issue
is governed by Griffith v State Farm Mut Auto Ins Co, 472 Mich 521; 697 NW2d 895 (2005).
Although Griffith considered compensation for food expenses, it indicated, in dicta, that its
reasoning and analysis would also apply to housing costs. Id. at 538. Under the Griffith
analysis, plaintiff’s housing costs are only compensable to the extent that those costs became
greater as a result of the accident. Id. at 535-540. Plaintiff must show that his housing expenses
are different from those of an uninjured person, for example, by showing that the rental cost for
handicapped accessible housing is higher than the rental cost of ordinary housing. In the absence
of that kind of factual record, the trial court erred by concluding that plaintiff was entitled to
housing costs compensation merely on the basis of the amount plaintiff was currently paying in
rent, for a residence that the record does not even demonstrate was handicapped accessible.
Accordingly, we reverse the orders granting summary disposition to defendant regarding
the wage loss claim and to plaintiff regarding the housing cost claim. In light of those
determinations, we need not consider plaintiff’s arguments regarding penalty interest and
attorneys fees, which would be better addressed initially by the trial court following factual
determinations as to timing and the propriety of plaintiff’s no-fault insurance claims, as well as
defendant’s actions in response.
We reverse and remand for further proceedings not inconsistent with this opinion.
Neither party having fully prevailed, no costs shall be imposed. We do not retain jurisdiction.
/s/ Richard A. Bandstra
/s/ Deborah A. Servitto
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