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Personal Automobile |
No Fault |
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Recovery of Benefits |
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On May 10, 2012, Carmen Schroeder was rear-ended after stopping her vehicle to make a left turn. Schroeder suffered a spinal fracture and underwent surgery on May 14. Schroeder was completely disabled until September 5 and partially disabled until October 3. At that time, she was a 59-year-old single woman who owned and maintained her own home. She had no nearby family. During her disablement, no one provided household care or maintenance services.
Schroeder submitted a claim to her automobile insurer, Western National Mutual Insurance Company (Western) for, among other things, the reasonable value of the care and maintenance services for her home that she was unable to perform. Western denied this part of her claim, asserting that it needed proof of what replacement services were performed and by whom. However, Western agreed that Schroeder need not have incurred any expense to be eligible for these benefits.
Schroeder petitioned for mandatory no-fault arbitration, claiming $3,400 in replacement services benefits, calculated as $200 per week from May 18 to September 13, 2012, and $100 per week from September 14 to September 21, 2012. An arbitrator ruled in Schroeder's favor, awarding $3,400 plus interest. Western petitioned a court to vacate the no-fault arbitration award arguing that the arbitrator misapplied the law in awarding benefits.
The district court denied Western's motion. It determined that Minnesota’s applicable statute justified recovery even when actual services were not replaced. Western appealed.
The appellate court noted that the section of the statute that covers replacement services and loss was interpreted by the Minnesota Supreme Court to contain two distinct and independent clauses. After examining the referenced clauses, the appellate court held that Schroeder was entitled to the reasonable value of her care and maintenance services, regardless of whether the services were replaced when the insured could not perform them. Because the arbitrator did not exceed his authority in awarding no-fault benefits under the second clause, the appellate court declined to disturb the award.
Carmen Schroeder vs. Western National Mutual Insurance Company-Court of Appeals of Minnesota-July 7, 2014-2014 WL 3024662