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Allstate loses appeal of judgment forcing payment of overdue PIP expenses and sanctions

Jerome Soulliere was hurt in a 2009 car accident.  Allstate, his insurer, initially paid his medical and wage loss, as required by the Personal Injury Protection [PIP] provisions of the no fault act. It then argued that he committed fraud in his PIP claims that completely invalidated his right to PIP benefits and stopped paying.  He sued and a jury rejected Allstate's aggressive argument.  It awarded him $8,000.00 in wage loss and almost $3,000.00 in penalty interest.  The judge concluded that Allstate had no reasonable basis for withholding the wage loss and awarded Soulliere $25,000.00 to cover his legal fees under the statute.

Allstate appealed.  Even though it drew a fairly conservative panel, the judges unanimously rejected Allstate's arguments.  They noted that Allstate presented no evidence to support the claim that it had paid the self-employed carpenter for periods when his personally-owned corporation had paid him wage loss.  They also noted that he had accurately accounted for the proper credits received during his limited disability period, against his prior $51,000.00 annual income.

Since the trial judge found no evidence to support Allstate's claim that the plaintiff made false "material misrepresentations," the judge did not abuse his discretion in awarding Soulliere his attorney's fees.  Both courts also rejected Allstate's argument that the plaintiff's attorney committed fraud in accounting for the hours he spent securing the plaintiff's verdict.  They deemed his $250.00 per hour fee and documented hours to be reasonable, given the claims Allstate was making.

Lastly, the Court of Appeals panel also rejected the plaintiff's cross-appeal.  He argued that since he lost business during the disability period, and therefore lost income after he was capable of working, he should be entitled to collect lost wages for the period after he was capable of working but had not picked up any contracts.  The higher court agreed that income lost during such a period could be collectible if it is "attributable to the injury," but noted that Soulliere did not provide any proof to support the causal connection in this case.  Apparently, he did not explain at trial how and why he lost the opportunity to work in the months after he recovered--either by turning down contracts, by word-of-mouth that he was "unavailable," by assigning work to other individuals, or by some other related problem.

Thompson O’Neil, P.C.
309 East Front Street
Traverse City, Michigan 49684
Toll Free: 1-800-678-1307
Fax: 231-929-7262