Action under the No-Fault Act (NFA) to recover for medical services rendered; Penalty interest under the NFA (MCL 500.3142); Williams v AAA MI; Reasonable proof of loss; Attorney fees under the NFA (MCL 500.3148(1)); Ross v Auto Club Group

Because the trial court failed to determine when plaintiff-VHS submitted its reasonable proof of loss, the court vacated the order denying VHS interest under MCL 500.3142(2) and attorney fees under MCL 500.3148(1), and remanded. VHS asserted that it was “entitled to penalty interest under MCL 500.3142 because the payments were due 30 days after it sent its bills to” defendant-Allstate. The record showed that VHS provided Allstate with five billing statements between 3/1/23 and 2/27/24. But the trial court did not “make findings as to whether those billing statements constituted reasonable proof of the fact and the amount of a claim in accordance with MCL 3142(2).” Given that payment was not issued until 6/17/24, if the trial court found the billing statements constituted “reasonable proof of the fact and of the amount of loss sustained, then the payments were overdue.” However, Allstate contended “it did not receive reasonable proof for all of VHS’s claims until it received an [4/1/24] e-mail from VHS’s lawyer. If this e-mail constituted reasonable proof of the claim, then the 90-day deadline under MCL 500.3142(3) would have expired on [6/30/24]. Under this factual scenario, because payment would be within 90 days of the receipt of reasonable proof of the fact and of the amount of loss, then the payment would not have been overdue and VHS would not be entitled to penalty interest.” But instead of “resolving this factual dispute, the trial court erroneously focused on whether Allstate had acted diligently in investigating VHS’s claim.” The court concluded that by “considering whether Allstate’s actions were reasonable, the trial court improperly read a requirement into the statute that VHS needed to demonstrate that there was an unreasonable delay in payment of benefits. Such a requirement impermissibly contravenes the language in the statute[.]” On remand, the trial court must make findings as to “when Allstate received ‘reasonable proof of the fact and of the amount of loss sustained,’ and, if appropriate, for a calculation of penalty interest.” In addition, more factual finding as “to when the claims became overdue is necessary to fully evaluate VHS’s request for attorney fees. Consequently, a remand for findings regarding the timeline as to VHS’s reasonable proof of loss and which claims were subject to factual uncertainty at the time that Allstate initially refused to pay is in order.”

Ineffective assistance, consent theory; Strickland v Washington; Ineffective assistance, impeachment limits; MRE 401; Sentencing; Scoring of OV 19; Interference; MCL 777.49; Acquitted conduct; People v Beck

The court held that defendant was not denied the effective assistance of counsel, but he was entitled to resentencing because OV 19 was incorrectly scored based on acquitted conduct and improper reliance on juror communications. Defendant was convicted of CSC III involving a “mentally incapable, mentally incapacitated, or physically helpless” victim. The record showed the victim awoke to oral contact and attempted penetration while asleep, with “very strong support” that defendant contributed DNA to swabs from the victim’s labia majora and cell-site evidence placing his phone near the home. On the ineffective-assistance claims, the court noted counsel attempted a consent theory, but the trial court correctly ruled “there was no evidence in this trial of consent,” and in any event consent is not a defense to CSC III under MCL 750.520d(1)(c) because an incapacitated or physically helpless person cannot “freely and willingly” agree. The court also rejected the impeachment claim, observing counsel pursued the Cash App issue but the trial court found it collateral and “not relevant,” and defendant did not show the evidence would have been admitted or changed the outcome. On sentencing, the trial court scored OV 19 at 10 points for “flight,” relying in part on its postverdict discussion with jurors about why they acquitted defendant of unlawfully driving away. The panel held OV 19 does not cover merely leaving a scene and that due process “bars sentencing courts from finding by a preponderance of the evidence that a defendant engaged in conduct of which he was acquitted.” Affirmed in part, reversed in part, and remanded.

Search & seizure; “Automobile exception” to the warrant requirement; “Probable cause”; Whether there was a “fair probability” that the vehicle contained evidence of a crime

[This appeal was from the WD-MI.] The court held that the police had “probable cause” to conduct a warrantless automobile search of defendant-Woods’s vehicle for a gun where there was a “fair probability” that the vehicle held evidence of a crime. An officer was dispatched on a report of domestic assault. The victim told the officers that, in addition to hitting her, Woods had held a “small” gun to her chest. Based on this information, the officer radioed “other officers in the area that there was probable cause Woods had committed a domestic assault. She added that Woods might be headed to his orange Dodge and that he had a gun.” Police eventually apprehended Woods in the apartment parking lot. He denied having a gun, but the police searched his vehicle and recovered a pistol. Woods was charged with FIP. He moved to suppress the firearm evidence, arguing that the warrantless search of his car violated the Fourth Amendment. The district court denied his motion. On appeal, the court held that “there was a fair probability that the gun was in Woods’s car, so the officers had probable cause to search it.” It concluded that they “reasonably believed the gun was evidence of a crime.” Two witnesses had seen Woods hit the victim and threaten her with a gun. “Those eyewitness accounts established probable cause that Woods had committed the crimes of assault and intentionally pointing a gun at another person. The gun was evidence of those crimes.” Because the officers did not find the gun after “reasonable efforts”—a canine search and a pat down—that “left the one place the police knew Woods had just been: his car.” This, along with a description of his vehicle, “created at least a fair probability that officers would find the gun in that car.” The court rejected the cases that Woods offered to support his arguments where, in those cases, “[o]fficers didn’t arrest those suspects at or near their cars.” Affirmed.

Sentencing; Enhancements based on co-conspirators’ conduct; “Relevant conduct” under USSG § 1B1.3(a)(1)(B); Whether co-conspirators’ actions were “within the scope of the jointly undertaken criminal activity” (§ 1B1.3(a)(1)(B)(i)); United States v Donadeo; Enhancements for theft from the person of another (§ 2B1.1(b)(3)), possession of a dangerous weapon (§ 2B1.1(b)(16)(B)), & physical restraint of a victim (§ 3A1.3); Enhancement for “use of sophisticated means” (§ 2B1.1(b)(10)(C))

[This appeal was from the WD-MI.] The court held that the district court did not err in applying enhancements based on his co-conspirators’ conduct in sentencing defendant-Yousef where their actions “were within the scope of Yousef’s jointly undertaken criminal activity.” The court also upheld application of the sophisticated-means enhancement. A jury convicted Yousef of interstate transportation of stolen goods and conspiracy to transport stolen goods interstate. The district court sentenced him to 109 months. Yousef challenged the procedural reasonableness of his sentence. As to the enhancements for theft from the person of another, possession of a dangerous weapon, and physical restraint of a victim, “Yousef did not personally commit the acts underlying” them – his co-conspirators did. But the district court found their actions attributable to him as “relevant conduct.” The court agreed. Applying the six Donadeo factors, it determined that five of them weighed against Yousef. His “conduct and the robberies were part of a single scheme—that is, to resell stolen cell phones obtained from robberies.” There were enough similarities that the similarity in modus operandi factor favored the government, and evidence showed “extensive coordination among Yousef and other participants in the conspiracy.” Further, he admitted that he knew about the robberies. And he “had significant involvement in” the scheme. The court also rejected his challenge to the two-level enhancement for use of sophisticated means, concluding the evidence supported that “Yousef, using his technical expertise in cell-phone repair, bypassed phone manufacturers’ anti-theft mechanisms to ensure the devices were saleable.” Affirmed.

Action under the No-Fault Act (NFA) to recover for medical services rendered; Penalty interest under the NFA (MCL 500.3142); Williams v AAA MI; Reasonable proof of loss; Attorney fees under the NFA (MCL 500.3148(1)); Ross v Auto Club Group

Because the trial court failed to determine when plaintiff-VHS submitted its reasonable proof of loss, the court vacated the order denying VHS interest under MCL 500.3142(2) and attorney fees under MCL 500.3148(1), and remanded. VHS asserted that it was “entitled to penalty interest under MCL 500.3142 because the payments were due 30 days after it sent its bills to” defendant-Allstate. The record showed that VHS provided Allstate with five billing statements between 3/1/23 and 2/27/24. But the trial court did not “make findings as to whether those billing statements constituted reasonable proof of the fact and the amount of a claim in accordance with MCL 3142(2).” Given that payment was not issued until 6/17/24, if the trial court found the billing statements constituted “reasonable proof of the fact and of the amount of loss sustained, then the payments were overdue.” However, Allstate contended “it did not receive reasonable proof for all of VHS’s claims until it received an [4/1/24] e-mail from VHS’s lawyer. If this e-mail constituted reasonable proof of the claim, then the 90-day deadline under MCL 500.3142(3) would have expired on [6/30/24]. Under this factual scenario, because payment would be within 90 days of the receipt of reasonable proof of the fact and of the amount of loss, then the payment would not have been overdue and VHS would not be entitled to penalty interest.” But instead of “resolving this factual dispute, the trial court erroneously focused on whether Allstate had acted diligently in investigating VHS’s claim.” The court concluded that by “considering whether Allstate’s actions were reasonable, the trial court improperly read a requirement into the statute that VHS needed to demonstrate that there was an unreasonable delay in payment of benefits. Such a requirement impermissibly contravenes the language in the statute[.]” On remand, the trial court must make findings as to “when Allstate received ‘reasonable proof of the fact and of the amount of loss sustained,’ and, if appropriate, for a calculation of penalty interest.” In addition, more factual finding as “to when the claims became overdue is necessary to fully evaluate VHS’s request for attorney fees. Consequently, a remand for findings regarding the timeline as to VHS’s reasonable proof of loss and which claims were subject to factual uncertainty at the time that Allstate initially refused to pay is in order.”

Tax foreclosure; Intervention; MCR 2.209; State Treasurer v Bences; Surplus proceeds claims; MCL 211.78t; Schafer v Kent Cnty; Rafaeli, LLC v Oakland Cnty; Extinguishment of mortgage interests; MCL 211.78k(6); Petersen Fin, LLC v City of Kentwood; General Property Tax Act (GPTA)

The court held that the trial court erred by allowing the mortgage assignee to intervene in a GPTA surplus-proceeds proceeding because MCL 211.78t provides the exclusive mechanism to claim surplus proceeds and the assignee failed to comply with that statute. After appellant’s property was foreclosed for unpaid taxes and later sold at auction, she timely filed the required form and motion claiming the surplus proceeds. Appellee, the assignee of the mortgage, did not file the statutory notice or a motion to claim proceeds and instead moved to intervene months later on equitable-subrogation and contract theories. The trial court granted intervention. On appeal, the court held that under Rafaeli former owners have a vested right to surplus proceeds, and that MCL 211.78t creates “the exclusive means of obtaining surplus proceeds.” The court next held that appellee’s mortgage interest was extinguished when title vested absolutely in the treasurer under MCL 211.78k(6), so appellee no longer had a legally protectable interest in the surplus-proceeds action. Because appellee failed to file Form 5743 and failed to file a timely motion under MCL 211.78t, it was not a proper claimant under the statute. The court also held that intervention was improper under both MCR 2.209(A)(3) and (B)(2) because appellee lacked an interest “relating to the property or transaction which is the subject of the action,” and its equitable-subrogation theory did not share a proper common question with the limited statutory distribution proceeding. The court noted that appellee might still sue appellant on the debt separately, but not in this surplus-proceeds case. Reversed and remanded.

Motion to set aside a default judgment; Good cause; Notice requirement compliance; State Court Administrative Office (SCAO)

Concluding that the trial court abused its discretion by denying defendant’s request to set aside the default judgment, the court reversed and remanded. It found that the “trial court erred when it determined that plaintiff complied with the notice requirements, and” thus abused its discretion in denying the request to set aside the default. Further, the error warranted “setting aside the default without the need to establish a meritorious defense, the failure to comply with notice requirements results in the deprivation of due process.” The court noted that “plaintiff submitted the SCAO standard form that included sections for a request for entry of default, the actual entry of default, and the entry of a default judgment. Plaintiff requested entry of a default against defendant on” 2/4/24. for failure to appear. The trial court’s clerk entered the default on 2/15/24, and the trial court signed it on 2/14/24. The court noted that on the “form, plaintiff failed to fill in any information on the section for a certificate of mailing as required by MCR 2.603(A)(2) (‘If the defaulting party has not appeared, the notice to the defaulted party may be served by personal service, by ordinary first-class mail at his or her last known address or the place of service, or as otherwise directed by the court.’) This defect constituted good cause for purposes of setting aside the default judgment.” Also, the “request for entry of a default judgment did not comport with MCR 2.603(B)(1)(a)(ii). Specifically, when requesting a default judgment, notice must be given to the defaulted party if the relief requested is ‘different in kind from, or greater in amount than, that stated in the pleadings[.]’ The SCAO MC 07a form submitted by plaintiff sought an amount greater than the valuations presented in the complaint. Regardless of plaintiff’s characterization of the amount as a scrivener’s error, this requested amount in excess of the addition of the values set forth in the complaint triggered plaintiff’s obligation to provide notice, and it did not comply.” Thus, the “omission constituted a deprivation of due process that alleviated the defense requirement to present a meritorious defense.”

Petition for a protective order of spousal support under MCL 700.5401(3); Whether a probate court can properly consider whether Medicaid benefits will be available to a protected individual prior to an eligibility determination; In re Estate of Schroeder; In re Vansach Estate; Whether the passing of the Medicaid applicant rendered the case moot; Effect of pending Michigan Office of Administrative Hearings & Rules (MOAHR) proceedings; Scope of remedy; Department of Health & Human Services (DHHS)

Noting that it had not previously addressed issuance of a protective order under MCL 700.5401(3)(b) in the Medicaid context, the court held that “a probate court can properly consider whether Medicaid benefits will be available to a protected individual prior to an eligibility determination when issuing a protective order under MCL 700.5401(3).” It overruled Schroeder because it was wrongly decided, and it held that the Court of Appeals erred in vacating the 2022 protective order in this case. Thus, it reversed the Court of Appeals judgment in this regard, reinstated the 2022 protective order, and remanded the case to the probate court. After moving to a nursing home, 82-year-old Jerome Sizick applied for Medicaid to help pay for his care. Before he did so, his wife petitioned the probate court on his behalf “for a protective order under MCL 700.5401(3), asking” it to transfer all of his assets and the majority of his income to her. The Court of Appeals ultimately ruled “that the probate court abused its discretion by finding that the requirements of MCL 700.5401(3)(b) were satisfied.” Jerome died while his wife’s application for leave to appeal was pending. The court first held that his death did not render the appeal moot. MOAHR proceedings remained pending and “reinstating the protective order will have a legal effect on” them. The court then considered the correct standard under MCL 700.5401(3). It reviewed two Court of Appeals published cases, Vansach and Schroeder, and the text of the statute. “MCL 700.5401(3) authorizes the probate court to enter a protective order if [it] determines certain conditions are present. Only” the condition in (3)(b) was “relevant here—that ‘money is needed for the individual’s support, care, and welfare or for those entitled to the individual’s support[.]’” It determined that “because any protective order issued must account for those individuals’ ongoing support needs for the foreseeable future, this assessment necessarily involves a prospective analysis.” Thus, it concluded “nothing in the statute forecloses consideration of the availability of Medicaid benefits, even if DHHS has not yet issued an eligibility determination.” This was consistent with the Vansach approach. The Court of Appeals erred in ruling in Schroeder “that probate courts cannot consider ‘Medicaid-related circumstances’ under MCL 700.5401(3)(b) if the institutionalized spouse is ‘not receiving Medicaid benefits’ and is ‘awaiting [a] Medicaid-eligibility determination[].’”

Tax foreclosure; Intervention; MCR 2.209; State Treasurer v Bences; Surplus proceeds claims; MCL 211.78t; Schafer v Kent Cnty; Rafaeli, LLC v Oakland Cnty; Extinguishment of mortgage interests; MCL 211.78k(6); Petersen Fin, LLC v City of Kentwood; General Property Tax Act (GPTA)

The court held that the trial court erred by allowing the mortgage assignee to intervene in a GPTA surplus-proceeds proceeding because MCL 211.78t provides the exclusive mechanism to claim surplus proceeds and the assignee failed to comply with that statute. After appellant’s property was foreclosed for unpaid taxes and later sold at auction, she timely filed the required form and motion claiming the surplus proceeds. Appellee, the assignee of the mortgage, did not file the statutory notice or a motion to claim proceeds and instead moved to intervene months later on equitable-subrogation and contract theories. The trial court granted intervention. On appeal, the court held that under Rafaeli former owners have a vested right to surplus proceeds, and that MCL 211.78t creates “the exclusive means of obtaining surplus proceeds.” The court next held that appellee’s mortgage interest was extinguished when title vested absolutely in the treasurer under MCL 211.78k(6), so appellee no longer had a legally protectable interest in the surplus-proceeds action. Because appellee failed to file Form 5743 and failed to file a timely motion under MCL 211.78t, it was not a proper claimant under the statute. The court also held that intervention was improper under both MCR 2.209(A)(3) and (B)(2) because appellee lacked an interest “relating to the property or transaction which is the subject of the action,” and its equitable-subrogation theory did not share a proper common question with the limited statutory distribution proceeding. The court noted that appellee might still sue appellant on the debt separately, but not in this surplus-proceeds case. Reversed and remanded.

Best interests; Relative placement; MCL 712A.19b(5); In re Olive/Metts

The court held that the trial court’s finding that it was in the child’s (LG) best interests to terminate respondent-father’s parental rights was not erroneous. “The testimony established that LG was thriving in his mother’s care, that he was getting ready to start kindergarten, that he was confused by the inconsistent phone contact with respondent, that the consistency of future contact was not guaranteed, that respondent posed a psychological risk to LG given his conviction for sexually exploiting LG’s half-siblings, that LG had only ever known one home, and that respondent’s 40-year incarceration would preclude any reunification until long after LG reaches 18 years of age.” The court agreed with respondent that the trial court erred by finding a lack of extended family support because the record showed financial help and contact from LG’s paternal grandfather. But it held that this error did not render the overall best-interests ruling erroneous. It also rejected respondent’s arguments that the trial court failed to consider LG’s placement with his mother, respondent’s parenting ability, and LG’s safety and stability. It held that the trial court adequately addressed LG’s placement with his mother, that respondent’s conduct was “fundamentally at odds with the responsibility of parenthood,” and that his 40-year sentence made any realistic reunification impossible. Affirmed.

Children’s removal; MCL 712A.13a(9); MCR 3.965(C)(2)-(4)

In these consolidated appeals, the court found no error in the trial court’s order removing the parties’ children from their care. As to respondent-mother, “the trial court was presented with substantial evidence that it was contrary to the children’s welfare to remain in” her care. In addition, it “heard testimony from caseworkers and service providers that indicated” both respondents exhausted the services the DHHS “provided to prevent removal and made no progress in their case service plans. Given the record” here, the court concluded “the trial court did not clearly err by finding that reasonable efforts had been made to prevent removal. The trial court also did not err in finding that the grandparents were able to adequately provide for the children’s welfare in light of the positive impact the grandmother had on their lives.” As to respondent-father, the record showed “the same circumstances generally existed. Specifically, the issues related to the children’s hygiene and the conditions of the home apply equally to [the] father. He, too, displayed an inability to address the basic needs of the children. [He] also failed to schedule a specialist appointment for the oldest child to address his ear issues. And, as with [the] mother, these issues only improved when the paternal grandmother entered the home. When she left, the conditions immediately began to deteriorate.” The court noted that unlike the mother, the father “continued to attend counseling. This is a positive indicator, although it is hampered to an extent by [his] medication mismanagement issues.” The court found that the most concerning issue as to the father “was his acts of domestic violence.” The children saw him push the mother “to the ground, and the oldest child disclosed that he was scared when respondents argued. The trial court had an evidentiary basis to conclude that the children faced further physical or emotional harm if they stayed in the home.” The court concluded “the trial court did not err in finding that” the children remaining in his “care was contrary to their welfare. Likewise, [it] met the requirements of MCL 712A.13a(9)(d) and (e) by placing the children in the grandparents’ care.” And reasonable efforts to prevent removal were made. Affirmed.