KELLY A BURKE V MICHIGAN CATASTROPHIC CLAIMS ASSN
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STATE OF MICHIGAN
COURT OF APPEALS
KELLY A. BURKE, JESSE VILLEGAS,
CHARLES JACKSON, GREGORY NELSON,
and THOMAS MARVIN,1
UNPUBLISHED
April 15, 2003
Plaintiffs-Appellants/CrossAppellees,
v
No. 227123
Wayne Circuit Court
LC No. 99-927754-CZ
MICHIGAN CATASTROPHIC CLAIMS
ASSOCIATION,
Defendant-Appellee,
and
AUTO CLUB GROUP INSURANCE COMPANY,
AUTO CLUB INSURANCE ASSOCIATION,
AUTO-OWNERS INSURANCE COMPANY,
CITIZENS INSURANCE COMPANY,
ALLSTATE INSURANCE COMPANY, and
STATE FARM MUTUAL AUTOMOBILE
INSURANCE COMPANY
Defendants-Appellees/Cross
Appellants,
and
MICHIGAN EDUCATIONAL EMPLOYEES
MUTUAL INSURANCE COMPANY,
Defendant/Cross-Appellant.
Before: Griffin, P.J., and Gage and Meter, JJ.
1
It appears that Harvey Kline was also a plaintiff in the lower court.
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PER CURIAM.
In 1998, the Michigan Catastrophic Claims Association (“MCCA”) returned to its
members, the automobile insurance companies who provide no-fault automobile insurance in
Michigan, $1.2 billion of its surplus funds in a lump sum equal to $180 for each vehicle that was
insured on March 18, 1998. The insurance companies gave their current policyholders of March
18, 1998, a sum of $180 per vehicle. Plaintiffs2 filed a potential class-action suit for breach of
fiduciary duty and breach of contract against the MCCA and seven automobile insurance
companies who are members of the MCCA. Plaintiffs claimed that the refund of $180 was
disproportionate because it did not take into account the pro rata contribution of each
policyholder. The MCCA moved for summary disposition under MCR 2.116(8) and (10),
arguing that it had no relationship with plaintiffs to support any claim of fiduciary and
contractual duties. The insurance companies also moved for summary disposition, under MCR
2.116(4), (8), and (10), arguing that the circuit court either lacked subject-matter jurisdiction or
that the commissioner of the office of financial and insurance services (“the Commissioner”) had
primary jurisdiction in this case and further arguing that plaintiffs failed to allege viable claims
for breach of fiduciary duty or contract. Plaintiffs appeal as of right from an order granting both
motions entered by the Wayne Circuit Court. We affirm.
On appeal, plaintiffs argue that the circuit court erred in granting defendants summary
disposition. The insurance companies counterclaim, asserting that even if the circuit court had
subject-matter jurisdiction over the case, primary jurisdiction in the Commissioner was proper.
We conclude that primary jurisdiction in the Commissioner was proper under the circumstances
of this case.
This Court reviews the grant or denial of a motion for summary disposition de novo.
Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). Similarly, we review
jurisdictional questions de novo. See Travelers Ins Co v Detroit Edison Co, 465 Mich 185, 205;
631 NW2d 733 (2001).
“Primary jurisdiction and subject-matter jurisdiction are distinct legal doctrines.” Id. at
205 n 18. Primary jurisdiction applies when a claim is originally cognizable in the courts but
requires the resolution of issues that have been placed within the special competence of an
administrative body under a regulatory scheme. Id. at 197. The judicial process is suspended so
that the administrative body may express its views. Id. at 198. “‘The doctrine reflects the
courts’ recognition that administrative agencies, created by the Legislature, are intended to be
repositories of special competence and expertise uniquely equipped to examine the facts and
develop public policy within a particular field.’” Id., quoting Judicial review of administrative
agency rules: A question of timing, 43 Baylor L R 139, 158 (1991). The Michigan Supreme
Court has noted that
“[n]o fixed formula exists for applying the doctrine of primary
jurisdiction. In every case the question is whether the reasons for existence of the
2
It is unclear from the complaint or subsequent filings in the lower court record whether the six
plaintiffs were former or current no-fault insurance policyholders on March 18, 1998.
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doctrine are present and whether the purposes it serves will be aided by its
application in the particular litigation.” [Travelers Ins Co, supra at 198, quoting
United States v Western P R Co, 352 US 59, 64; 77 S Ct 161; 1 L Ed 2d 126
(1956).]
Under the doctrine, an agency uses its special competence to appraise facts, and the agency’s
findings may then serve as a premise for later legal consequences. Travelers Ins Co, supra at
199-200.
In this case, the Commissioner’s involvement in the matter would focus the parties’
arguments on the correct nature of the refunds and the legal and factual reasoning behind the
manner in which the refunds were awarded.3 A judicial determination at this point, without
deferring to the primary jurisdiction of the Commissioner, would allow the circuit court to decide
the matter without the benefit of the Commissioner’s review of the facts and law in this case.
The court would have to proceed without the benefit of the Commissioner’s analysis of how a
ruling adverse to defendants in the instant case would affect the statutory operations of the
MCCA and the ultimate return of future surplus assessments to policyholders. Thus, this case
does not involve basic issues that courts address on a regular basis and that are within the
conventional experiences of judges. See id. at 199.
We are convinced that the Commissioner is best equipped to review the particular facts
and laws at issue in this case and to best anticipate the effect of a ruling adverse to defendants.
Deferring to the Commissioner will “reinforce[] the expertise of the agency” and “avoid[] the
expenditure of judicial resources for issues that can better be resolved by the agency.” Id. at 197.
Accordingly, we conclude that the Commissioner had primary jurisdiction over this case.4 To
the extent that the circuit court granted the motions for summary disposition on different bases,5
we note that this Court will not reverse a circuit court’s decision reaching the correct result for
the wrong reasons. Phinney v Perlmutter, 222 Mich App 513, 532; 564 NW2d 532 (1997). The
trial court did not err in its grant of summary disposition.
Affirmed.
/s/ Richard Allen Griffin
/s/ Hilda R. Gage
/s/ Patrick M. Meter
3
The parties characterize the refund in several different fashions.
4
Plaintiffs contend that the Commissioner is not empowered to award damages as requested by
plaintiffs. In response, and without directly addressing plaintiffs’ contention but instead leaving
its ultimate resolution to the Commissioner, we note simply that under the doctrine of primary
jurisdiction, circuit court jurisdiction is merely suspended and later circuit court claims may
remain. See Durcon Co v Detroit Edison Co, 250 Mich App 553, 563; 655 NW2d 304 (2002).
5
We acknowledge that the court did not grant the MCCA summary disposition on jurisdictional
grounds. However, upon our de novo review we conclude that dismissal on jurisdictional
grounds was proper.
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