HAROLD BROWN V SPECIALTY NATL INS CO
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STATE OF MICHIGAN
COURT OF APPEALS
HAROLD BROWN,
UNPUBLISHED
January 17, 2006
Plaintiff/Counter-DefendantAppellee,
v
No. 256022
Wayne Circuit Court
LC No. 02-243046-CK
SPECIALTY NATIONAL INSURANCE
COMPANY,
Defendant-Appellant,
and
MODERN SERVICE INSURANCE COMPANY,
Defendant/Counter-Plaintiff/ThirdParty Plaintiff-Appellee,
and
MORRIE L. BROWN,
Third-Party Defendant.
Before: O’Connell, P.J., and Smolenski and Talbot, JJ.
MEMORANDUM.
Defendant Specialty National Insurance Company appeals as of right from a circuit court
order denying Specialty’s request for attorney fees and interest. We affirm. This case is being
decided without oral argument pursuant to MCR 7.214(E).
Specialty paid personal protection insurance benefits to plaintiff pursuant to an insurance
policy covering the vehicle in which plaintiff was riding as a passenger. It was later discovered
that Modern Service Insurance Company had higher priority, and after an initial attempt to
rescind its policy, Modern Service agreed to reimburse Specialty for the benefits it had paid.
Specialty then sought payment of attorney fees and interest pursuant to MCL 500.3172(3)(f).
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Whether MCL 500.3172(3)(f) authorizes the recovery of attorney fees and interest
presents a question of statutory interpretation and application, which this Court reviews de novo.
Eggleston v Bio-Medical Applications of Detroit, Inc, 468 Mich 29, 32; 658 NW2d 139 (2003).
According to MCL 500.3172(3), if two insurance companies dispute their obligation to pay
personal protection benefits, then they must inform an assigned claims facility who will then
assign the obligation to another insurance company. The dispute is submitted to circuit court,
and the insurance company that loses the dispute must pay all the legal expenses of the assigned
insurance company, plus interest. Id. In this case, however, the insurance companies did not
submit the case to the assigned claims facility, so there was no “reimbursement to the assigned
claims facility” or “reimbursement ordered under this subdivision” which would include the
mandatory attorney fees and interest. MCL 500.3172(3)(f). Phrases in statutes should not be
read in a vacuum, and we will not extract words and phrases from their context to defeat their
intended import. G C Timmis & Co v Guardian Alarm Co, 468 Mich 416, 421; 662 NW2d 710
(2003). Here, the parties did not submit the short-lived dispute to the assigned claims facility, so
the additional remedies provided by MCL 500.3172(3)(f) are not available. Therefore, the trial
court correctly denied Specialty’s request for attorney fees and interest under this subdivision.
Affirmed.
/s/ Peter D. O’Connell
/s/ Michael R. Smolenski
/s/ Michael J. Talbot
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