Extreme Court Part 2

Jan. 24, 2007

The embattled Michigan Supreme Court made national headlines last week with the justices holding a public hearing on how to punish justices who talked out of school. Not surprisingly the majority will make its decision behind closed doors.
But you might be interested to know the rest of the story - the Engler agenda of the four-member majority has prompted the court to aggressively strike its own precedents, causing the doors of justice to close on people with legitimate lawsuits.
The Supreme Court has overturned its own long-held rulings at an unprecedented rate by anyone’s measure, especially after Justice Stephen Markman joined the court majority in 1999.
“There is a study of the court rulings that shows little people are losing and the financial interests of the state are winning—the insurance companies, corporations, wealthy health care providers, developers,” said George Thompson, a Traverse City trial attorney.
Thompson was talking about an analysis of 57 opinions between February and August of 1999, cited by the Negligence Law Section Quarterly.
In not one opinion during that time frame did the “victim” win, according to the analysis, conducted by a section of the State Bar.

“CORRECTIONS”
The Supreme Court has a history of rarely striking its own precedent. So although this court has overturned less than one percent of the cases it reviews, that’s still triple the historic rate, according to a Michigan Lawyers Weekly article.
Yet one insider explained that the court has had to impose “corrections” on earlier, more liberal Supreme Court rulings. Some of those opinions, although motivated by care and compassion, overstepped the bounds of written law. Yet critics contend the Supreme Court majority is now engaged in judicial activism of its own.
The insider added that the Supreme Court is often called to interpret badly written laws, which are often not even read by the legislators who pass them. It has also “literally” interpreted contracts even though prior rulings had established a far different interpretation. The court action puts the badly written state law and/or contracts back in the laps of those who need to fix them.

OUT OF DATE LAW
The Apsey case, although decided by the Court of Appeals and not the Supreme Court, provides a good example. The court discovered a law passed in the 1800s that requires that a county clerk must certify an out-of-state notary. The court then dismissed a medical malpractice case based on the archaic law, and refused to allow the plaintiff to come back with the required certificate. That judgment has been intensely criticized because some states don’t even have a county clerk and the requirement serves no purpose.
Beyond that, a 1980s law requires judges to give full faith and credit to the legal documents of other states—which should trump a 100-year-old law, Thompson said.
State Representative Kevin Elsenheimer (R-Bellaire) believes the court rendered the right decision because it was based on law, and it’s now up to the Legislature to straighten it out.
“I have actually requested a bill to change that law because the law made no sense to me; it was form over function,” he said. “I think the Court of Appeals rendered the right decision, but the Legislature needs to straighten that out. It was a law made in the 1800s. But the bottom line was it was sloppy legislative drafting that led to the result that people with legitimate cases couldn’t bring them.”

LAW-MAKING JUSTICES
St. Clair Shores attorney Bob Garvey was so disturbed by the top court’s decisions that he funded an independent CPA to survey 126 attorneys, evenly divided between those who represent victims and those who represent insurance companies and corporations. Eighty-seven responded.
There was agreement on both sides that the Supreme Court has rendered opinions that are better left to the state’s lawmakers (84% agreed).
The attorneys were also asked: Do you generally agree that the decisions and opinions of the Michigan Supreme Court majority suggest a pattern of bias that favors insurance companies and large corporate interests over those of ordinary citizens in civil litigation matters?
The answer: 79 percent said yes, 21 percent said no.

KIDS AND CAR CRASHES
Some of the more controversial decisions include the Cameron case in which the Supreme Court applied a different interpretation of insurance policies, giving a family only one year from the date of a car injury to file suit.
Attorney Grant Parsons complained that this affects children who have no control over when a parent files a lawsuit. And a brain-injured child often doesn’t show the full extent of the brain injury because they’re so young.
In the Kreiner case, the Supreme Court essentially rewrote the law that a person cannot collect damages from the insurance company of the person who caused the car accident unless the trajectory of the victim’s life has changed -- for example, if the person can’t hold the same job.
That decision changed the intent of the law, which originally defined the threshold as “serious impairment of an important body function” to “life altering,” Thompson said.

CONSERVATIVE CLAMP
The Supreme Court decisions dovetail several laws passed by a conservative Legislature that has clamped down on lawsuits. Michigan, for example, is the only state in the country in which residents cannot sue a prescription drug company for damages (and Michiganians obviously still pay the same drug prices as anyone else).
“I just know Michigan is one of the most unfortunate states in this whole fight,” said Joanne Doroshow, executive director of the Center for Justice and Democracy, a nonprofit group that advocates for the civil justice system. “The tort system has been quite undermined and the Supreme Court is terrible. They’ve become activists from a business and anti-consumer standpoint.
“People don’t realize this is going on because they generally don’t use the court. It’s not until they’re facing a tragedy before they know their rights have been taken away and they need to use them. Contrary to popular opinion, very few people who are injured ever sue. So only a small percentage of people know how badly it feels to have their rights taken away.”

*Although Supreme Court justices are elected, they are usually first appointed when a position is vacated and then run for office. An incumbent judge has very rarely lost. Engler appointed three of the judges to the Supreme Court and one to the Court of Appeals. All were re-elected.


True Stories of Citizens Denied their Rights


By Anne Stanton

Here are a few stories of those who had an arguably legitimate reason to sue, but either decided not to (because it was hopeless) or had their case thrown out of court.

PULLING THE RUG
Richard Holman of Flushing liked to vacation with his family at a cabin on Pickerel Lake in Emmet County. About five years ago, a vicious summer storm with winds of at least 65 mph hit the area and snapped over trees and telephone poles like small twigs.
A huge white pine crashed onto Holman’s cabin, the most badly damaged home on the lake. He drove up the next day and immediately filed a claim with his insurance company, Auto Owner’s Insurance.
The insurance company only wanted to pay for fixing the roof, yet the damage was catastrophic, shifting the beams and walls. He provided photos and information to his insurance company within a month of the storm, but Auto Owners spent a year figuring out what it was going to do, said his attorney, Enrico Schaefer of Traverse Legal.
“Eventually after a year, they issued a denial letter on the majority of the damage and finally denied a big portion of his claim. He contacted me and we filed suit, and back at that time, the longstanding Supreme Court precedent made his claim timely,” he said.
Holman spent tens of thousands of dollars on attorney fees, experts to analyze the structural integrity of his home, and assessors.
Then on the eve of his trial in July of 2005, the Supreme Court issued a new ruling overturning its prior precedent on when lawsuits against insurance companies must be filed (the case was Deviller v. Auto Owners Insurance Association).
The Supreme Court also ruled that any and all cases that were in the judicial pipeline were to be thrown out despite the fact that those people had relied on longstanding Supreme Court precedent in knowing when lawsuits had to be filed against their insurance companies.
Even the state Insurance Commissioner argued against the Supreme Court’s sudden change of law. And Holman had no choice but to withdraw his lawsuit.
“We’re talking about Holman’s case and thousands of cases like his in Michigan -- real people who had the rugs pulled out from underneath of them, people who spent thousands to bring legitimate and meritorious cases. And those attorneys, in turn, relied on 19 years of Supreme Court precedent establishing people’s rights,” Schaefer said.
“People in Michigan should have the ability to rely on the rule of law, especially when the Supreme Court has ruled on an issue. While I disagree with the substance of the Supreme Court’s ruling, I was extremely troubled by the fact that the Engler ‘four’ left all those Michigan citizens who had relied on established law out to dry.
“Their ruling was yet another example where the Court, from many people’s perspective including both Republicans and Democrats, ignored legal precedent in blindly ruling in favor of corporate interests and insurance companies. I understand their love for insurance companies. I don’t understand their apparent contempt for the people of the state of Michigan,” Schaefer said.
Holman said the cabin had to be torn down, and he was reimbursed a small fraction of the total cost. He was also dinged because the insurance company didn’t cover the cost of complying to a new setback code that was implemented after the cabin was built in 1948.
“Anyway you look at it-from a moral and legal standpoint-it was not right,” Holman said.
“NO DUTY”
On a drizzly, starless night in 2002, Richard Babel accidentally drove straight down Crescent Shores Road, onto the boat launch, and into Long Lake. There was a dead-end sign at the time, but it wasn’t reflective, rendering it useless in the dark. He was 85-years-old at the time.
Two years later, Karen Gilhooly, M.D., a physician with three children in tow, accidentally drove off the boat launch on a rainy November night in 2004. All four perished. Despite the earlier accident and several close calls, the Grand Traverse County Road Commission was not held accountable for the Gilhooly tragedy.
That rationale owes, in part, to the Michigan Supreme Court ruling of Nawrocki v. Macomb County Road Commission that says there is “no duty” for the road commission to maintain safe travel on roads. The ruling changed several decades of existing law by holding that the road authority’s statutory duty to “maintain reasonably safe roads” applies only to the roadbed and not to signs, guard rails, or shoulders. The justices’ ruling was based on a law that provides for governmental immunity with certain exceptions. The Road Commission has since improved the signage.

MOWED DOWN
In August of 1998, Trina Goethals was on a bike tour on M-204 in Suttons Bay. She had a flag and was riding to the far right of the lane when she heard the sound of gravel. The next thing she knew some bicyclists were standing around her, asking if she was okay. A pick-up truck had hit her from behind, and she was in shock.
Goethals, a University of Michigan journalism student, was hospitalized and had to wear a body brace to help heal two broken vertebrae. Suffering from back pain, she immediately filed a claim with the insurance company of the driver, who was allegedly under the influence of prescription drugs. She did so largely because her own insurance company in Missouri said it did not participate in Michigan’s no-fault program and didn’t have to pay. That made the driver’s insurer the first in priority to pay her claims under the no-fault act.
While the insurance company was haggling with her, she missed the policy deadline to sue, which was one year. The courts used to interpret that one-year deadline as beginning when the insurance company denied the claim, but this time enforced the policy exactly as it was written. It was one more instance when an interpretation of the law was made much tougher against victims, said Jay Zelenock, her third attorney.
(In fact, this is a trap that many now fall into -- by the time the insurance company renders a decision, it’s too late to file a lawsuit. Most attorneys won’t take these lawsuits anymore because of this Catch-22.)
Goethals explained she filed her lawsuit to ensure all her medical bills were paid and that she and her father (who was also hit) were compensated for their bikes.
“We weren’t trying to get more than we deserved, but we wanted to make sure our bills would be covered for something that wasn’t our fault,” she said.
As it turns out, it was another win for the insurance industry. Goethals’ bills weren’t honored. Because she gamely returned to her studies the following term, her broken back was deemed by the court not to be serious enough to file a claim against the negligent driver, said Jay Zelenock, who represented her.
The Supreme Court had not yet made the infamous Kreiner ruling (see page 7), but the Appeals court was already going in that direction and the insurance companies were taking its cue. In the end, she received a minimal damage award (she and her father were compensated for their bikes at least).
“I was definitely upset. It affected my life. I was hit by a truck riding a bike at 21, I had medical damages, and it wasn’t my fault. My attorneys were wonderful, but this is ultimately why I went to law school and became a lawyer. I wanted to do my part in making sure this didn’t happen to anyone else,” said Goethals, who handles civil litigation cases in Columbus, Ohio.

Editor’s Note: To educate yourself on insurance issues google “good faith, bad faith insurance.”