Michigan Court of Appeals; Docket # 344330; Unpublished
Judges Swartzle, Cavanagh, and Cameron; per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Interpretation of Insurance Contracts
SUMMARY:
In this unanimous unpublished per curiam decision, the Court of Appeals addressed whether to apply an insurance policy provision that excluded coverage for any driver of the subject motor vehicle if said driver did not have “reasonable belief of permission to use the vehicle.” In this case, the vehicle at issue was being operated by a minor who had explicit permission from the owner to drive it. The Court determined that so long as the owner had given such permission, the exclusion could not apply and that the fact that the minor’s operation of the vehicle was illegal was irrelevant under the policy’s language.
This case arises out of a single-car accident that resulted in the death of the vehicle’s driver, Stormi Elkins. Elkins, a 15-year-old, attended a party with co-defendants Walkir Neihardt, Joel Daugherty, and Justin Gilbert, and was instructed by her mother and grandmother upon leaving her house not to drive. The group traveled to the party in Daugherty’s truck, and later in the night, according to Neihardt, Daugherty became intoxicated and let Elkins drive the group to the store. Elkins subsequently crashed the vehicle, and both Gilbert and Daugherty filed separate complaints—against Daugherty, the Elkins’ estate, and their respective insurers, Pioneer and Hastings. Home-Owners, Elkins’ grandmother’s no-fault insurer, moved for summary disposition, denying “any liability on behalf of [Elkins] as a relative living in the home because she was excluded from coverage for using a vehicle ‘without a reasonable belief of permission.’” Home-Owners argued that, “while [Elkins’ grandmother’s] policy covers relatives who drive a non-owned vehicle, coverage only extends to instances when the relative had a reasonable belief of permission to use the vehicle,” but that Elkins could not have had a reasonable belief of permission to use the vehicle because she did not have a driver’s license, her driver’s permit was suspended, her grandmother and mother expressly told her not to drive on the night of the accident, and a question of fact existed as to whether Daugherty really gave permission to Elkins to drive his truck.
Pioneer filed its own motion for summary disposition, arguing that Daugherty was the only person authorized to grant Elkins permission to drive and that the exclusion in the Home-Owner’s policy “did not state that the person driving had to have ‘your’ permission, i.e., permission from the policyholder; instead, the exclusion required the person to have a reasonable belief of permission, meaning permission from the person with the authority to grant it—usually the owner of the vehicle.” The trial court ultimately granted Pioneer’s motion for summary disposition and denied Home-Owners’.
The Court of Appeals agreed with the trial court’s conclusion, finding that although the Home-Owners policy excluded coverage for vehicles not “owned by or furnished or available for regular use to you or anyone living with you . . . [and used] . . . without a reasonable belief of permission to do so,” that provision could not be applied to the facts in this case. The relevant portions of the policy only require that the insured or the insured’s relative have a reasonable belief of permission that the owner of the vehicle, or someone else authorized by the owner, consented to use of the vehicle. The Court noted that:
Home-owners could have drafted the exclusion and stated ‘your permission’ if its intent was to ensure that a relative had permission from the policyholder to drive another’s vehicle. Because such language was not included, the clear language of the policy exclusion requires a reasonable belief that the relative has obtained consent from only the owner of the automobile or someone authorized to give consent on behalf of the owner . . .
The question, then, turns on whether [Elkins] had a reasonable belief of permission from Daugherty to use his truck. After reviewing the record, we conclude that there is no genuine issue of material fact that [Elkins] had a reasonable belief of permission from Daugherty to use the truck. The evidence clearly shows that [Elkins] was driving Daugherty’s truck at the time of the accident while Daugherty sat in the passenger seat. Even though Daugherty testified at his deposition that he did not remember if he allowed [Elkins] to drive, he admitted that he was the only one who could have given [Elkins] permission to do so. Moreover, in his answer to a request for admissions, Daugherty indicated that he let [Elkins] drive the truck. Additionally, Neihardt testified that Daugherty let [Elkins] drive because Daugherty was too intoxicated to drive. Neihardt also provided a detailed description of what transpired before the crash, including why they had driven to the store, how fast [Elkins] was driving, and that Daugherty was hanging out the passenger window just before the accident. Finally, the police report indicated that [Elkins] had been driving the truck at the time of the accident. Viewing this evidence in the light most favorable to Home-Owners, it is clear that [Elkins] had a reasonable belief that Daugherty gave her permission to use the truck.
Home-Owners argued that Elkins’ could not have had a reasonable belief of permission to use the vehicle considering her underage status, level of intoxication, and the instructions from her mother and grandmother not to drive. Nor did Daugherty have the legal authority to Grant Elkins permission to drive his vehicle, because doing so was a crime. The Court disagreed with both arguments. As to the first, the Court stated:
This evidence, however, does not detract from the fact that [Elkins] reasonably believed that she had permission from Daugherty, who was the owner of the truck, to use the truck. Even if [Elkins] knew she could not legally drive, nothing in the policy requires the legal operation of the vehicle. To conclude otherwise would require this Court to read new language into the policy. Therefore, this argument is without merit
As to the second, the Court stated:
The question here, however, is not whether Daugherty could have legally granted [Elkins] permission to use the truck, but is instead limited to whether [Elkins] reasonably believed that she had permission to do so.
