Kosielv.Arrow Liquors Corporation

Not overruled or negatively treated on appealinfoCoverage
Supreme Court of MichiganJun 21, 1996
452 Mich. 853 (Mich. 1996)
452 Mich. 853549 N.W.2d 343

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No. 104132.

June 21, 1996


Leave to Appeal Denied June 21, 1996:

reported below: ( On Remand) 211 Mich. App. 550.


I would grant leave to appeal.

This Court, in Kosiel v Arrow Liquors Corp, 446 Mich. 374 (1994), in an earlier appearance of this case, held that an order awarding compensation for nursing care provided by the plaintiff's husband was not a final order for purposes of application of the doctrine of res judicata. This Court remanded to the Court of Appeals to consider other issues that had been raised, but not addressed by that Court. The Court of Appeals, on remand, held that benefits should be limited to fifty-six hours a week, to commence on July 1, 1980, two years before the application was filed. 211 Mich. App. 550, 556 (1995).

I

Plaintiff was injured in 1956 while in defendant's employ. Worker's compensation was paid. In 1967, plaintiff was awarded 215 weeks of compensation for the loss of her right leg. The referee also found that plaintiff was incurably insane and totally and permanently disabled. Defendant was ordered to pay plaintiff's husband $5 a day for nursing expenses until further ordered.

In 1982, plaintiff petitioned for an increase in the rate of compensation for nursing care. A referee awarded an increase, both parties appealed, and then the parties agreed to arbitration. The arbitrator awarded an increase in the rate of compensation, an increase in the hours for which compensation was appropriate, and an award retroactive to 1968. The issue now is whether the Court of Appeals correctly ruled that the award could not be made retroactive to years before 1980.

The Court of Appeals held that the retroactivity of the award was limited to two years pursuant to MCL 418.381(2); MSA 17.237(381)(2):

Except as provided in subsection (3), if any compensation is sought under this act, payment shall not be made for any period of time earlier than 2 years immediately preceding the date on which the employee filed an application for a hearing with the bureau.

The meritorious question is whether this section should be applied to an injury suffered long before the enactment of § 381.

II

The two-year-back rule was enacted by 1965 PA 44, effective September 1, 1965, and provided:

Whenever weekly payments are due an injured employee under this act, such payments shall not be made for any period of time earlier than 2 years immediately preceding the date on which the employee filed notice of application for hearing and adjustment of claim with the department.

Because plaintiff's injury was mental illness, the latest possible date of plaintiff's injury was her last day of work, August 29, 1965, two days before the effective date of 1965 PA 44. Therefore, at the date of injury, the law did not place any limit on retroactive recovery of benefits.

1965 PA 44 included a saving clause:

All of the provisions of this 1965 amendatory act shall apply only to personal injuries the date of injury of which occurs on or after the effective date of this act, except as otherwise specifically provided in this act and except for the amendment to part 2, section 4, concerning selection of physicians as provided in this act.

Thus, plaintiff was not limited to an award reaching only two years back, both because of the saving clause in 1965 PA 44, and because the two-year-back rule as originally enacted only applied to "weekly benefits."

The worker's compensation act was reenacted in 1969. The substance of the two-year-back provision was not changed, and there was another saving clause in 1969 PA 317:

To the extent that they are reenacted herein, all the provisions of former Act No. 44 of the Public Acts of 1965 shall apply only to personal injuries the date of which occurs on or after September 1, 1965, except as otherwise provided in such act and except for the amendment to part 2, section 4 of the act, concerning selection of physicians as provided in that act.

Section 381(2) was amended to include medical expenses by 1980 PA 357, effective January 1, 1982. No saving clause was enacted with 1980 PA 357. The Court of Appeals considered the retroactivity issue in Franklin v Ford Motor Co, 197 Mich. App. 367 (1992), and decided that because the change was "more remedial than substantive," it should be applied retroactively. The Court did not consider the prior statutory saving clauses enacted in 1965 and 1969.

Before 1980 PA 357, § 381(2) provided:


Whenever weekly payments are due an injured employee under this act, such payments shall not be made for any period of time earlier than 2 years immediately preceding the date on which the employee filed application for hearing with the bureau.

Following January 1, 1982, § 381(2) read:

If any compensation is sought under this act, payment shall not be made for any period of time earlier than 2 years immediately preceding the date on which the employee filed application for hearing with the bureau.

III

Twice, in 1965 and 1969, the Legislature made it clear that the two-year-back rule did not apply to cases involving injuries as old as plaintiff's. Moreover, the two-year-back rule did not apply to plaintiff's award for medical expenses until 1982.

Legislation is generally prospective. In some cases, retroactive application may be appropriate. But when there is clear evidence of legislative intent to the contrary, retroactive application that limits claims is inappropriate.

The difficulty and importance of this issue is demonstrated by differing analyses of the Court of Appeals. In Ivezaj v Federal Mogul Corp (On Remand), 197 Mich. App. 462 (1992), the Court applied § 381 as it was at the time of injury in the absence of a legislative statement to the contrary. In Wozniak v General Motors Corp, 198 Mich. App. 172 (1993), the Court relied on the saving clause of statutory precursors to § 381. In Franklin, the Court concluded that § 381(2) was remedial and therefore retroactive application was appropriate.

CAVANAGH, J. I would grant leave to appeal.


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