By George T. Sinas
On July 31, 2010, the Michigan Supreme Court issued a series of end-of-term opinions that included the long-awaited decision in the McCormick v. Carrier.
The decision recognizes that Kreiner v. Fischer, which it overruled, was nothing more than judge-made law that constituted a radical departure from the specific language and overall intent of the Michigan No-Fault Act.
It is reasonable to expect that this decision will actually reduce the number of lawsuits filed in circuit court, for the reason that, under Kreiner, auto insurance companies were forcing victims to file lawsuits so they could defeat legitimate claims in court by imposing the draconian legal standards of Kreiner. Hopefully, this practice will end under McCormick, as insurance companies will now be forced to recognize legitimate claims and deal with innocent victims in a fair and just manner.
The McCormick decision should dramatically decrease the amount of appellate court litigation by returning Michigan to the stable and less litigious appellate court environment that existed prior to Kreiner.
In this regard, the majority opinion notes that in the nine years prior to Kreiner, there were fewer than 10 Court of Appeals cases per year dealing with the tort threshold. However, in the six years since
Kreiner was decided, there have been more than 250 Court of Appeals decisions.
By rejecting the Kreiner standard, the amount of appellate court litigation should dramatically decrease, thereby saving tax dollars and freeing up Michigan appellate judges to address other important legal cases.
Any argument by the insurance industry that McCormick will increase insurance premiums should be flatly rejected as untrue and fear-mongering. In this regard, auto liability insurance premiums typically represent only about 20 percent of a person’s total auto insurance premium. It is estimated that 50 to 60 percent of the typical total auto insurance premium goes to pay for collision and comprehensive coverages.
Moreover, during the repressive six-year Kreiner era, auto liability insurance premiums never went down, thus establishing the fact that there is little, if any, link between the interpretation of the Michigan auto tort threshold and the cost of liability insurance.
Under McCormick, the insurance industry will be forced to return some of the staggering profits it made during the last six years to auto accident victims who have been paying premiums intended to benefit them, not fatten the bank accounts of auto insurers.
McCormick clearly illustrates the unfairness and injustice created by Kreiner for people like Mr. McCormick, who sustained a severe fracture to his ankle when his leg was run over by a truck. He required two operations to repair his shattered ankle. He was off work for 19 months, and, when he returned, was not able to resume his normal job duties. Medical testimony established that his injury had caused the onset of degenerative arthritis in his ankle joint, which is only bound to get worse over time.
Victims like Mr. McCormick had never been denied compensation during the 37-year history of the Michigan no-fault law until Kreiner came down six years ago. After that, people like him were routinely denied the right to hold careless and drunk drivers accountable for injuries that significantly affected their quality of life. It is because of the unfairness of Kreiner for people like Mr. McCormick that Kreiner had become universally condemned by almost all knowledgeable observers, except those associated with the auto insurance industry.
George T. Sinas of Sinas, Dramis, Brake, Boughton, & McIntyre PC in Lansing, received his bachelor’s degree from the University of Michigan and his law degree from Wayne State University. He is a past president of the Michigan Association for Justice (formerly the Michigan Trial Lawyers Association) and a past chairperson of the State Bar Negligence Law Section.
