Morales v. Auto-Owners Insurance

Michigan Supreme Court

Lansing, Michigan 48909

Chief Justice Justices

Opinion
Maura D. Corrigan Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman

FILED DECEMBER 30, 2003

ALICE JO MORALES, as Guardian and
Conservator for ANTONIO MORALES, a
legally incapacitated person,
also known as ANTHONY MORALES,

Plaintiff-Appellant,

and

JAMES W. BOYD, Chapter 7 Bankruptcy
Trustee,

Intervening Plaintiff-Appellant,

v No. 122601

AUTO-OWNERS INSURANCE COMPANY,

Defendant-Appellee.
____________________________________

PER CURIAM

AFTER REMAND

At issue in this case is whether prejudgment interest

awarded under MCL 600.6013 accrues during appellate
proceedings. On the authority of Dedes v Asch,1 the Court of

Appeals held that it does not.2 We disagree because the

language of MCL 600.6013 unambiguously states that

prejudgment interest is to be calculated from the date the

complaint is filed. It contains no exception for periods

of appellate delay. Accordingly, we overrule the 1998

Court of Appeals decision in Dedes. We also reverse in

part the judgment of the Court of Appeals in this case and

remand it to the trial court for recalculation of the

prejudgment interest.

I. Background

Antonio Morales was left substantially disabled after

an automobile accident in 1991. He had purchased no-fault

insurance coverage from defendant Auto-Owners Insurance

Company, but the company denied his claim on the ground

that the policy had expired six days before the accident.

Mr. Morales’s conservator, plaintiff Alice Jo Morales,

filed suit against defendant. The trial court granted

defendant’s motion for summary disposition, and the Court

of Appeals affirmed. This Court granted leave to appeal,

reversed, and remanded the case for trial. 458 Mich 288;

582 NW2d 776 (1998).

1
233 Mich App 329, 340; 590 NW2d 605 (1998).
2
Unpublished opinion per curiam, issued October 4, 2002
(Docket No. 233826).
2
 Thus, after about four years of appellate proceedings,

this case was remanded to the Missaukee Circuit Court for

trial. The jury returned a verdict for Ms. Morales, and

the trial court awarded prejudgment interest to her under

MCL 600.6013. Defendant argued that prejudgment interest

should not accrue during the four-year period while the

case was on appeal, because that delay was not its fault.

The trial court rejected this argument and awarded full

interest on the judgment.

The Court of Appeals reversed. Relying on Dedes, it

held that “[p]rejudgment interest does not continue to

accrue during the appellate process.” It remanded the case

to the trial court for a recalculation of prejudgment

interest. Ms. Morales now seeks leave to appeal to this

Court.3

II. Standard of Review

Statutory interpretation is a question of law that

this Court reviews de novo. Adams Outdoor Advertising, Inc

v City of Holland, 463 Mich 675, 681; 625 NW2d 377 (2001).

The cardinal principle of statutory construction is that

courts must give effect to legislative intent. Dressel v

3
On August 1, 2003, we granted two motions for leave to
file briefs amicus curiae and granted the motion to
intervene filed by James W. Boyd, a Chapter 7 Bankruptcy
Trustee. We now grant Taco Bell Corporation’s and the
Michigan Defense Trial Counsel’s motions for leave to file
briefs amicus curiae.
3

Ameribank, 468 Mich 557, 562; 664 NW2d 151 (2003). If the

Legislature’s intent is clearly expressed, no further

construction is permitted. Helder v Sruba, 462 Mich 92,

99; 611 NW2d 309 (2000). Under such circumstances, a court

is prohibited from imposing a “contrary judicial gloss” on

the statute. In re Certified Question (Kenneth Henes

Special Projects Procurement v Continental Biomass

Industries, Inc), 468 Mich 109, 119; 659 NW2d 597 (2003).

III. Analysis

MCL 600.60134 states:

(1) Interest is allowed on a money judgment
recovered in a civil action . . . .
* * *
(6) For a complaint filed on or after
January 1, 1987, but before July 1, 2002, if the
civil action has not resulted in a final,
nonappealable judgment as of July 1, 2002, and if
a judgment is or has been rendered on a written
instrument that does not evidence indebtedness
with a specified interest rate, interest is
calculated as provided in subsection (8).

Subsection 8 confirms that interest accrues “from the date

of filing the complaint” and that it “is calculated on the

entire amount of the money judgment, including attorney

fees and other costs.” MCL 600.6013(8).

4
This statute was amended after the trial court
calculated the award of prejudgment interest. The most
recent amendments apply to this case.
4
 In Dedes, the Court of Appeals held that prejudgment

interest awarded under MCL 600.6013 may be disallowed for

periods of delay that are neither the fault of, nor caused

by, the judgment debtor. 233 Mich App 340. The Dedes

Court concluded that prejudgment appellate proceedings fell

within this category, and it reversed the trial court’s

grant of prejudgment interest for the period that the case

was on appeal. It explained:

To allow interest to continue to accrue
during an appellate process would hinder parties
from asserting new and innovative arguments in
the trial court for fear that interest will
continue to accrue on a claim that may be
reversed during the appeal process. Id.

Relying on Dedes, the Court of Appeals held here that

defendant was not responsible for prejudgment interest

during the four years that this case was on appeal.

The Dedes decision is wholly inconsistent with MCL

600.6013, which states that prejudgment interest is

calculated “from the date of filing the complaint . . . .”

MCL 600.6013(8). The statute makes no exception for

periods of prejudgment appellate delay. In the face of the

Legislature’s clearly expressed intent, this Court will not

read such an exception into the statute. Dressel, 468 Mich

562; In re Certified Question (Henes v Continental Biomass,

468 Mich 119. Under MCL 600.6013, Ms. Morales is entitled

5

to an award of prejudgment interest that includes the four-

year period during which this case was on appeal.5

IV. Conclusion

Accordingly, we overrule the 1998 Court of Appeals

decision in Dedes v Asch. We reverse part II of the

judgment of the Court of Appeals concerning prejudgment

interest in this case and remand the case to the circuit

court for recalculation of the prejudgment interest. MCR

7.302(G)(1). We otherwise deny plaintiff’s application for

leave to appeal and defendant’s application to cross-appeal

because we are not persuaded that this Court should review

the other questions presented.

Maura D. Corrigan
Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman

5
As a general rule, prejudgment interest runs from the
date the complaint is filed. Here, the judgment includes
an award of no-fault benefits that were not incurred until
after the complaint was filed. In the trial court, Ms.
Morales agreed that prejudgment interest on those benefits
would run from the first date that the benefits were
unpaid, not from when the complaint was filed. We do not
intend our holding in this case to disturb the parties’
stipulation.
6