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Replacement Services Incurred More than Three Years After Accident Are Not Recoverable under MCL 500.3135(3)(c)

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Joseph E. Kozely, Jr.
Foster Swift No-Fault E-News
August 9, 2012

The Michigan Supreme Court has held that replacement services incurred more than three years after the date of a motor vehicle accident are not recoverable under MCL 500.3135(3)(c).  Johnson v Recca, No. 143088.

This case is important because it reverses a published and therefore binding opinion of the Michigan Court of Appeals that would have expanded the scope of economic damages recoverable under MCL 500.3135(3)(c).

In July 2004, the plaintiff was struck by a motor vehicle driven by the defendant, who was insured by Allstate Property and Casualty Insurance Company. At the time, the plaintiff did not have her own No-Fault insurance and was not a resident relative of anyone so insured.  The plaintiff filed a third-party tort claim against the defendant, seeking damages for replacement services pursuant to MCL 500.3135(3)(c). The trial court granted summary disposition in the defendant's favor. The Court of Appeals reversed in a published opinion. Johnson v. Recca, 292 Mich App 238; 807 NW2d 363 (2011).

The Michigan Supreme Court granted leave to appeal. On July 30, 2012, the Supreme Court, by a 4-3 vote, reversed the decision of the Court of Appeals:

In a third-party tort action, damages for excess allowable expenses, work loss, and survivor's loss are recoverable pursuant to MCL 500.3135(3)(c). Because replacement services are not among the categories listed in MCL 500.3135(3)(c), damages for replacement services are not recoverable in such an action. Accordingly, we reverse the Court of Appeals' judgment in part, reinstate the trial court's grant of summary disposition in defendant's favor on plaintiff's economic damages claim for replacement services expenses, and remand the case to the trial court for further proceedings not inconsistent with this opinion.

Slip Opinion, p. 26.