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Walrath v. Witzenmann USA LLC

Court of Appeals of Michigan

June 8, 2017

LAWRENCE W. WALRATH, Plaintiff-Appellant,
v.
WITZENMANN USA LLC, Defendant-Appellee.

         Oakland Circuit Court LC No. 2015-148982-NO

          Before: Jansen, P.J., and Murphy and Borrello, JJ.

          PER CURIAM.

         Plaintiff appeals by right an order granting defendant's motion for summary disposition pursuant to MCR 2.116(C)(10). We affirm.

         Defendant is a Michigan limited liability company and has maintained a worker's compensation insurance policy since it began operations in 2000. In 2013 and 2014, defendant obtained its policy through Star Insurance (Star). Defendant's 2014 policy period began on January 1, 2014, providing coverage for a term of one year pending timely premium payments. Defendant missed the premium payment due on May 1, 2014, and on May 6, 2014, Star mailed defendant a notice of pending cancellation. Star did not receive a payment and canceled defendant's policy three weeks later, on May 29, 2014. On June 14, 2014, plaintiff was operating a "10-ton hydraulic burst tester, " at one of defendant's facilities when the material being tested flew out of the tester and struck plaintiff in the face. Plaintiff suffered multiple fractures, sinus damage, brain injury, and post-traumatic stress disorder related to the incident. Defendant was made aware of Star's cancellation of the worker's compensation policy when defendant attempted to file a claim on plaintiff's behalf. On June 18, 2014, defendant wired a premium payment to Star and Star reinstated defendant's policy with "no lapse in coverage." Star then opened a claim for plaintiff's injury and plaintiff began receiving medical and wage-loss benefits pursuant to defendant's policy.

         Plaintiff brought a one-count complaint in the circuit court against defendant for negligence. Plaintiff sought to hold defendant liable for all economic and noneconomic losses stemming from the injury because, on the date of the accident, "defendant did not have any workers' compensation insurance coverage, as required by MCL 418.611."

         Defendant moved for summary disposition under MCR 2.116(C)(8) and (C)(10), arguing that because defendant had obtained reinstatement of the worker's compensation insurance policy, it had "secured" coverage for plaintiff and complied with Section 611 of the Michigan Worker's Disability Compensation Act (WDCA), MCL 418.101 et seq. Therefore, defendant argued, under MCL 418.131, the WDCA provided the exclusive remedy for plaintiff's work-related loss. The circuit court agreed with defendant, and granted defendant's motion pursuant to MCR 2.116(C)(10).

         On appeal, plaintiff argues that the trial court erred in concluding that defendant complied with the WDCA's coverage requirements and plaintiff's negligence claims were barred by the WDCA's exclusive remedies provision. We disagree.

         We review a trial court's decision on a motion for summary disposition de novo. Bernardoni v. City of Saginaw, 499 Mich. 470, 472; 886 N.W.2d 109 (2016). Defendant sought summary disposition under MCR 2.116(C)(8) and (C)(10). However, the circuit court explicitly stated that its decision to grant summary disposition was made pursuant only to MCR 2.116(C)(10). Summary disposition is proper under MCR 2.116(C)(10) if "there is no genuine issue as to any material fact, and the moving party is entitled to judgment . . . as a matter of law." West v. Gen Motors Corp, 469 Mich. 177, 183; 665 N.W.2d 468 (2003). We consider the affidavits, pleadings, depositions, admissions, and other documentary evidence in the light most favorable to the nonmoving party. Liparoto Const, Inc v. Gen Shale Brick, Inc, 284 Mich.App. 25, 29; 772 N.W.2d 801 (2009). A party opposing summary disposition under MCR 2.116(C)(10) may not rely on mere allegations or denials in pleadings, but must go beyond the pleadings to set forth specific facts showing that a genuine issue of material fact exists. Oliver v Smith, 269 Mich.App. 560, 564; 715 N.W.2d 314 (2006).

         This case requires this Court to interpret the provisions of the WDCA. Questions of law in a worker's compensation case are reviewed de novo, as are questions requiring statutory interpretation. Smitter v. Thornapple Tp, 494 Mich. 121, 129; 833 N.W.2d 875 (2013). "[T]he WDCA is in derogation of the common law, and its terms should be literally construed without judicial enhancement." Paschke v. Retool Industries, 445 Mich. 502, 511; 519 N.W.2d 441 (1994). "Rights, remedies, and procedure thereunder are such and such only as the statute provides, " and "[i]f the statute is short of what it should contain in order to prevent injustice, the defects must be cured by future legislation and not by judicial pronouncement." Id., quoting Luyk v. Hertel, 242 Mich. 445, 447; 219 N.W. 721 (1928).

         The material facts of this case are not in dispute. The propriety of the trial court's order for summary disposition in favor of defendant under MCR 2.116(C)(10) therefore turns on whether defendant was entitled to judgment as a matter of law. Defendant argued, and the trial court agreed, that Star's reinstatement of defendant's worker's compensation policy, backdated to provide coverage from the date of cancellation "with no lapse, " brought defendant into compliance with the coverage mandates for employers under the WDCA. Thus, plaintiff was limited to the remedies provided under the Act. Plaintiff argues to the contrary, insisting that the trial court erred when it determined that his negligence claims were barred. Plaintiff submits that the plain language of the WDCA permits an injured employee to sue an employer whose insurance coverage has been canceled before the date of the injury, regardless of whether the policy is subsequently reinstated and the injured employee receives benefits under the policy.

         Stated succinctly, the question this Court must answer is whether an employer whose worker's compensation policy has been canceled maintains compliance with the coverage mandate of MCL 418.611, avoiding civil suit for injuries sustained by an employee during the cancellation period, by securing reinstatement of the policy to cure the lapse. Resolution of this issue is a matter of first impression in Michigan.

         When this Court interprets a statute, its goal is "to give effect to the Legislature's intent, focusing first on the statute's plain language." Ronnisch Construction Group, Inc v. Lofts on the Nine, LLC, 499 Mich. 544, 552; 886 N.W.2d 113 (2016). Statutes must be examined as a whole, and individual words and phrases are read in the context of the entire legislative scheme. Id. Unless otherwise defined in the statute or accepted as terms of art, words of a statute are assigned their plain and ordinary meaning. Alvan Motor Freight, Inc v. Dep't of Treasury, 281 Mich.App. 35, 40; 761 N.W.2d 269 (2008). Further, an individual statute "must be read in conjunction with other relevant statutes to ensure that the legislative intent is correctly ascertained." Potter v. McLeary, 484 Mich. 397, 411; 774 N.W.2d 1 (2009). "When a statute's language is unambiguous, the Legislature must have intended the meaning clearly expressed, and the statute must be enforced as written." Ronnisch, 499 Mich. at 552.

         "The WDCA substitutes statutory compensation for common-law tort liability founded upon an employer's negligence in failing to maintain a safe working environment." Herbolsheimer v. SMS Holding Co, Inc, 239 Mich.App. 236, 241; 608 N.W.2d 487 (2000) (quotation marks and citations omitted). "Under the WDCA, employers provide compensation to employees for injuries suffered in the course of employment, regardless of fault." Id. Under MCL 418.301, an employer is required to compensate an employee who "receives a personal injury arising out of and in the course of employment, " as provided in the Act. Section 611 of the WDCA governs worker's compensation coverage ...


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