Standing; Olsen v Jude & Reed, LLC; Real party in interest; MCR 2.201(B); Assignment of rights; Allardyce v Dart; Indemnification; St Luke’s Hosp v Giertz; Mootness; Duty to defend; Costs & attorney fees; Failure to address the terms of a release

The court held that the trial court erred by denying defendant-Great Lakes summary disposition of plaintiffs-medical providers’ complaint against it and its own third-party complaint against third-party defendant-Kukan. In the underlying case, Kukan sued Great Lakes and a no-fault insurer for injuries he sustained while working at a recycling plant owned by Great Lakes. Meanwhile, he assigned rights to plaintiffs. The trial court granted the insurer summary disposition, while Kukan and Great Lakes entered into a settlement agreement and release. Plaintiffs then sued Great Lakes in the present action seeking recovery “for the care and treatment they provided to Kukan because their medical bills were unpaid.” In turn, Great Lakes filed a third-party complaint contending Kukan was responsible to indemnify it for any judgment obtained by plaintiffs. On appeal, the court agreed with Great Lakes that the trial court erroneously denied it summary disposition of plaintiffs’ complaint by concluding the assignment from Kukan to plaintiffs conferred standing upon plaintiffs, allowing them to sue Great Lakes. “[T]he plain language of the assignment established that Kukan only assigned his ‘rights, privileges and remedies’ for services provided by plaintiffs to which he was entitled under the no-fault act, i.e., PIP benefits.” Given that the assignment was “plainly limited to claims under the no-fault act, the trial court erroneously found that Kukan assigned all of his legal rights to plaintiffs—including under tort and equitable theories.” In light of the court’s conclusion that plaintiffs did not have standing to pursue the claim against Great Lakes, it found they also could not obtain a judgment against Great Lakes. As such, “Great Lakes will not be held accountable to plaintiffs, and therefore, cannot obtain a recovery for indemnification” from Kukan, making the issue of indemnification moot. But the court noted that the trial court “never examined the terms of the release independent of the claimed assignment to address whether a duty to defend was invoked.” Reversed as to the denial of Great Lakes’ motion for summary disposition of plaintiffs’ complaint, vacated as to the denial of its motion for summary disposition of its third-party complaint, and remanded for further proceedings as to the third-party complaint.