Gongwer News Service
The Michigan Supreme Court on Wednesday vacated a Court of Appeals ruling on the tolling period of a no-fault auto insurance lawsuit following its decision on Tuesday in another case.
The Supreme Court, in lieu of granting leave to appeal in Encompass Healthcare PLLC v. Citizens Insurance Company (MSC Docket No. 165321), instead issued an order to vacate the Court of Appeals' holding that the complaint was tolled and that recovery personal injury protection benefits was not barred by statute. The lawsuit was also remanded to the Court of Appeals.
The decision was based on the Supreme Court's decision in Spine Specialists of Michigan PC v. MemberSelect Insurance Company (MSC Docket No. 165445) issued Tuesday (See Gongwer Michigan Report, April 1, 2025).
In an opinion written by Chief Justice Elizabeth Clement, the majority in Spine Specialists held that the new tolling rule – which starts the clock on the one-year-back period for lawsuits over denied claims runs until the insurer formally denies the claim – did not apply to cases with claims that accrued before June 11, 2019.
Encompass Healthcare was heard as oral arguments in the same session as Spine Specialists because they dealt with similar circumstances. The former case involved the trial court finding there was no basis for tolling the complaint, while the Court of Appeals reversed. The high court was asked to determine whether the defendant waived its challenge to the retroactive application of the law, and whether the Court of Appeals correctly applied the tolling provision of the one-year-back rule, among other questions.
The high court basically answered that question in Spine Specialists on Tuesday. Wednesday's order remands the case to the Court of Appeals for reconsideration in light of Spine Specialists.
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