Decedent Did Not ‘Regularly’ Support Child: Survivor’s Loss Benefits Denied | Speaker Law
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Decedent Did Not ‘Regularly’ Support Child: Survivor’s Loss Benefits Denied

Posted on Wednesday, February 23, 2022

The trial court properly dismissed this action for no-fault survivor’s loss benefits, the Michigan Court of Appeals has ruled, because the decedent’s surviving daughter 1) did not “regularly” receive financial support from the decedent and 2) was not “domiciled” with the decedent.

In Estate of Lawrence v Schauf (Docket No. 354872), Krystal Lawrence was trying to cross a five-lane street on a rainy night without using the crosswalk. Lawrence was killed when separate vehicles driven by the defendants, Sarah Schauf and Austin Martin, struck her. After the crash, it was determined that Lawrence had a blood-alcohol level of 0.296.

The plaintiff filed this lawsuit against the defendants in Kalamazoo County Circuit Court. The plaintiff asserted negligence on behalf of Schauf and Martin, and sought personal protection insurance (PIP) benefits, including survivor’s loss benefits from the companies that insured Schauf and Martin.

The trial court dismissed the negligence claims, holding that no reasonable jury could find that Lawrence was less than 50 percent at fault. The trial court also dismissed the survivor’s loss benefits claim, finding the plaintiff did not demonstrate that Lawrence provided “regular” financial support for her daughter, JL, and therefore JL was ineligible for benefits.

The Court of Appeals affirmed.

“Although Lawrence may have provided some support for JL before the accident, no genuine issue of material fact existed that JL ‘regularly’ received support from Lawrence at the time of Lawrence’s death, as required under MCL 500.3110(1)(c),” the Court of Appeals said. “Ignoring the word ‘regular’ in MCL 500.3110 would render that term surplusage or nugatory, which this Court will not do.”

Judges Stephen L. Borrello, Michael J. Kelly and James Robert Redford were on the panel that issued the unpublished opinion.

No-Fault Benefits Properly Denied

On appeal, the plaintiff argued the trial court should not have dismissed the claim for survivor’s loss benefits.

“We disagree,” the Court of Appeals said, citing Belcher v Aetna Casualty & Surety Co, 409 Mich 231 (1980), and pointing out that survivor’s loss benefits “are payable only where the deceased had contributed things of tangible economic value to the dependent’s support or where the deceased had performed services for his dependents during the injured person’s lifetime.”

The Court of Appeals then examined MCL 500.3108(1), noting that “dependents of the deceased at the time of the deceased’s death” are entitled to survivor’s loss benefits. “Although MCL 500.3108 does not define ‘dependent,’ the term has been construed to include ‘a person who was receiving support and services from the deceased injured person prior to his death.’”

Next, the Court of Appeals explained that MCL 500.3110 offers guidance as to who may qualify as a dependent of a deceased individual. The statute says, in part: “(1) The following persons are conclusively presumed to be dependents of a deceased person: … (c) A child while under the age of 18 years, or over that age but physically or mentally incapacitated from earning, is dependent on the parent with whom he lives or from whom he receives support regularly at the time of the death of the parent. … (2) In all other cases, questions of dependency and the extent of dependency shall be determined in accordance with the facts as they exist at the time of death.”

Here, the plaintiff first argued that because JL stayed with Lawrence on alternate weekends, she therefore “lived with” Lawrence and this was sufficient to trigger the conclusive presumption of MCL 500.3110(1)(c). But the Court of Appeals disagreed, referencing Grange Ins Co of Michigan v Lawrence, 494 Mich 475 (2013), where the Michigan Supreme Court addressed the application of the term “domiciled” in MCL 500.3114(1) to determine PIP benefit priority for minor children. In Grange, the high court reasoned that the term “domicile” has “’a particular meaning in the law’ and that an individual can only have one domicile, which it defined as ‘[a] place where a person lives or has his home,’” the Court of Appeals said. “The Court also noted that, when enacting the no-fault act, ‘rather than there being any indication that the Legislature intended to deviate from this common-law rule, there is, in fact, evidence that the Legislature favored this single-location rule.’… The Court held that, unlike an adult, a child cannot acquire a ‘domicile of choice,’ and therefore, the traditional ways of determining a person’s domicile are ‘irrelevant.’ … Instead, the Court ‘expressly recognized that a child’s domicile, upon the divorce or separation of the child’s parents, is the same as that of the parent to whose custody he has been legally given pursuant to a custody order.’ … The Court determined that this conclusion was also consistent with the Child Custody Act, MCL 722.21 et seq., which provides, inter alia, that courts are charged in any dispute regarding custody, with ‘declar[ing] the child’s inherent rights and establish[ing] the rights and duties as to the child’s custody … in accordance with this act.’”

Meanwhile, although MCL 500.3110 does not use the term “domicile,” the phrase “dependent on the parent with whom he lives” is “synonymous with the longstanding definition of domicile, of which JL could have only one,” the Court of Appeals reasoned. “In May 2018, Lawrence and JL’s father, Timothy Engler, agreed that Engler would have sole physical custody of JL, with the two continuing to share legal custody, and the court entered an order awarding Engler sole physical custody of JL beginning June 15, 2018. Therefore, consistent with Grange, as a matter of law, JL did not ‘live with’ Lawrence at the time of the accident, but with Engler.”

The plaintiff also argued that Lawrence provided regular support for JL, thereby entitling JL to benefits under MCL 500.3110(1)(c). “The May 21, 2018 custody order provided that ‘[c]hild support is still an issue and shall be referred to a hearing with the Referee,’” the Court of Appeals noted. And according to the plaintiff, JL “spent only occasional weekends at the home Lawrence shared with her mother” at the time of the accident. In making this argument, the plaintiff relied, in part, on testimony that Engler provided financial support to Lawrence’s mother after the accident and, therefore, Lawrence must have been providing that amount of support. “However, Engler testified that he provided Lawrence’s mother money for food because JL stayed there because her summer school was located next to her grandmother’s home,” the appeals court observed. “This later voluntary contribution after Lawrence’s death, while JL resided with her grandmother full time, does not give rise to a reasonable inference that Lawrence provided such level of support when she was not financially responsible for JL.”

The testimony that was presented, in addition to Engler’s explanation that the custody arrangement and Lawrence’s lack of any child-support obligation were designed to allow Lawrence to save money to afford her own place, “supported the trial court’s determination that JL was not entitled to survivor’s benefits,” the Court of Appeals concluded. “Although Lawrence may have provided some support for JL before the accident, no genuine issue of material fact existed that JL ‘regularly’ received support from Lawrence at the time of Lawrence’s death, as required under MCL 500.3110(1)(c).”

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