Atty fees are between the Plaintiff and attorney

In an order, the court reversed in part and affirmed in part the Court of Appeals judgment in a published case (see e-Journal # 45797 in the 5/17/10 edition). The court held that the Court of Appeals erred in relying on the "common fund" exception to the "American Rule" because no common fund was created. At issue was an attorney fee dispute arising from an action for benefits under the No-Fault Act. "As the Court of Appeals implicitly recognized," the DMC was not liable for the plaintiff's attorney fees under the Act. The court agreed that "plaintiff is responsible for payment of her attorney fees consistent with the contingency fee agreement. Consistent with the common-law American rule," the Act "generally requires each party to pay its own attorney fees." The court concluded that plaintiff's reliance on MCL 500.3112 was "unavailing because that provision, which permits equitable apportionment of personal protection insurance benefits among payees, does not encompass an award of attorney fees to an insured's counsel." The court was concerned "that the circuit court's order, and the Court of Appeals' affirmance, could be mistakenly interpreted as extinguishing the DMC's contractual right to payment for its services." The court made it clear that this was not the case. Through settlement, no-fault benefits were paid to plaintiff, and her attorney asserted an attorney's charging lien over the settlement proceeds. The "effect of this was only to settle claims as between the insurer, plaintiff, and her attorney. The circuit court's order of dismissal pursuant to the settlement agreement did not have the effect of extinguishing the DMC's right to collect the remainder of its bill from plaintiff." That result could not be achieved "without an explicit waiver, or at least unequivocal acquiescence, by the DMC, which was not obtained."