Wayland v. New Light Nursing Home Corporation (2007 WL 2744638 (Mich.App.))

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Wayland v. New Light Nursing Home Corporation (2007 WL 2744638 (Mich.App.))

Wayland v. New Light Nursing Home Corporation (2007 WL 2744638 (Mich.App.))
Plaintiff (Appellee) – Wayland, as guardian of Thelma Johnson, an Incapacitated Individual
Defendant (Appellant) – New Light Nursing Home Corporation
Court of Appeals of Michigan (2007)

Plaintiff, mother of Thelma Johnson, sued the defendant alleging that they negligently failed to train and supervise its employees and provide for the safety of her mother. After pleadings and several motions had been filed, plaintiff, defendant, and Admiral (defendant’s insurer up until July 2, 2000) entered into a “Release and Indemnity Agreement,” in which plaintiff agreed, in return for a payment of $27,500 by Admiral on behalf of defendant, to release defendant and Admiral from “any and all” claims and causes of action,” which accrued prior to July 2, 2000.

Subsequently, plaintiff entered into an arbitration agreement giving the arbitrators “full powers to make a determination as to any and all claims” of plaintiff against defendant.  The arbitration panel awarded plaintiff $125,000. Pursuant to defendant’s motion, the trial court found that defendant was entitled to set off the $27,500 settlement from the arbitration award. Plaintiff appealed.


Plaintiff’s mother resided at defendant nursing home from March 28, 2000, until September 14, 2000. During this period, defendant held two insurance policies. Prior to July 2, 2000, defendant was insured by Admiral Insurance Company. Beginning July 2, 2000, defendant was insured by Legion Insurance Company.

On September 5, 2000, plaintiff was informed that another resident had struck her mother. On September 6, 2000, plaintiff discovered that her mother had fallen.  Plaintiff sued defendant for negligence.


Trial court ruled that since the awards stemmed from the same injury, the amount awarded by the arbitration panel could be set off in the amount of the previous settlement.


Should the trial court have set off the amount of the settlement agreement from the arbitration award because it would constitute double recovery?

“Where a recovery is obtained for any injury identical with another in nature, time, and place, that recovery must be deducted from the plaintiff’s other award.”

  • Grace v. Grace, 253 Mich.App 357, 369

The court found that the above rule was not applicable because the settlement agreement did not purport to compensate plaintiff for the injury her mother allegedly suffered in September 2000, but rather was to release Admiral from any claims against the policy prior to July 2, 2000. Therefore, the settlement and arbitration awards did not constitute double recovery.

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