Personal protection insurance (PIP) benefits; Whether a patient who assigned her claim for PIP benefits to a third party may still sue to recover those benefits; C-Spine Orthopedics, PLLC v Progressive MI Ins Co; Comparing Wallace v Suburban Mobility Auth for Reg’l Transp; Real party in interest; Standing; Suburban Mobility Authority for Regional Transportation (SMART)

On remand from the Supreme Court, the court concluded that C-Spine Orthopedics and Wallace controlled, requiring remand “for the trial court to ‘balance the equities and determine whether equitable rescission is warranted under the facts of this case’ and whether the real party in interest defect that existed at the filing of the complaint can be cured.” Thus, it vacated the trial court’s order denying defendant-SMART’s summary disposition motion and remanded. The Supreme Court remanded the case to the court for reconsideration in light of C-Spine, directing it “to reconsider whether a patient who has assigned her claim for PIP benefits to a third party may still file a lawsuit to recover those benefits.” Noting that the facts and proceedings here were “nearly identical to the circumstances in Wallace” (a companion case to C-Spine), the court focused on the Supreme “Court’s resolution of that case.” The Supreme Court ruled “that while Wallace had standing to file a lawsuit, she lost her real party in interest status when she assigned her claims for PIP benefits to her medical providers.” Its decision on “Wallace’s appeal turned on the fact that the trial court, because of its understanding of the legal issues before it, did not engage in a rescission analysis. Put another way, the trial court accepted Wallace’s rescission, but never balanced the equities before doing so.” Just like in Wallace, plaintiff here “assigned her rights to pursue PIP benefits to her medical providers.” Less than a year after the accident, she “filed a complaint to collect first-party no-fault PIP benefits” from SMART. Subsequently, she “and several of her medical providers entered into agreements whereby they agreed to revoke and rescind, ‘nunc pro tunc’ the assignments. Similar to Wallace, SMART argued that plaintiff was not the real party in interest and had no standing to pursue her claims because she had already assigned her claims to her medical providers. The trial court denied the motion, in part, based on its finding that [she] and her medical providers had revoked the assignments and, as a consequence, plaintiff could pursue her claim for PIP benefits. As in Wallace, the trial court here accepted plaintiff’s claim of rescission, but never balanced the equities.”