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Motor Vehicle Exception to Governmental Immunity

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If a motorist is injured when a truck fails to obey traffic laws and causes an accident, the liability of the truck owner for the plaintiff’s damages seems clear. But what happens when the truck is part of a fleet owned and operated by the State of Michigan or a Michigan municipality? Does governmental immunity impact the scope of the plaintiff’s damages?

The Michigan Supreme Court issued an opinion addressing two cases – Hannay v MDOT and Hunter v Sisco – both of which involved this same scenario.

In the Hannay case, the plaintiff sought compensation for injuries she suffered when a Michigan Department of Transportation (MDOT) salt truck ran a stop sign and struck her car. The trial court awarded her nearly $475,000 in noneconomic damages, $767,000 for work-loss benefits, and almost $154,000 in expenses for ordinary and necessary services. Meanwhile, in Hunter, the plaintiff sued Auto Club Insurance and the City of Flint after a municipal dump truck sideswiped his vehicle. Although the trial court denied the City’s motion for summary disposition, the Michigan Court of Appeals reversed in part, ruling that the plaintiff was barred from recovering non-economic damages for pain and suffering or emotional damage.

Michigan’s Governmental Tort Liability Act (“GTLA”) states that “[g]overnmental agencies shall be liable for bodily injury and property damage resulting from the negligent operation by any officer, agent or employee of the governmental agency, of a motor vehicle of which the governmental agency is owner.” MDOT contended that the State was only liable for medical expenses Ms. Hannay incurred as a result of the accident since the statute provides only for “liability for bodily injury,” and that economic damages such as work-loss was not available to the plaintiff.  In Hunter, the City of Flint did not challenge the economic damages award, but similar to MDOT’s argument, asserted that non-economic damages such as pain and suffering were not available to Mr. Hunter because they were not “bodily injuries” under the GTLA.

In its opinion, the Michigan Supreme Court agreed with both plaintiffs and ruled that “liable for bodily injury” is equivalent to being “legally responsible for damages flowing from a physical or corporeal injury to the body.” In its interpretation of the GTLA, the Court held that a governmental entity is liable for the same damages available against other defendants in third-party no-fault lawsuits – including economic (excess wage loss, etc.) and non-economic (pain and suffering, etc.) damages – so long as the plaintiff otherwise qualifies under Michigan’s No-Fault Act by sustaining a serious impairment of body function or other qualifying injury. The Court limited recovery to a plaintiff’s own bodily injury, however, thus precluding the plaintiff from seeking damages resulting from bodily injury to another.

The Court also considered the nature and extent of damages for a plaintiff’s inability to work, concluding that recovery for work-loss is available, but compensation for loss of earning capacity is not. With respect to work-loss, the Court ruled that although the No-Fault Act allows recovery for loss of income that an injured person would have performed in the three years immediately following the date of the accident, the accident must be the “but for” cause, meaning that the accident must directly cause the loss of income. In Hannay, the plaintiff claimed that “but for the accident [she] would have been accepted into a dental-hygienist program, would have graduated, and would have been employed at least 60% of the time, by the specific dental office where she was already working, at a rate of $28 an hour.” The Court rejected this assertion, finding that Ms. Hannay failed to properly establish that she would have actually earned those future wages, and that the basis for the trial court’s award was “impermissibly contingent and speculative.”

Author: Amy Applin

Amy Applin

A talented and accomplished attorney, Amy Applin relishes the opportunity to delve into thorny, intricate, and perplexing legal issues.

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