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Bracy, et al v Nichols, et al (COA – UNP 10/13/2022; RB #4496)   

Michigan Court of Appeals; Docket #359397; Unpublished  
Judges Swartzle, Cavanagh, and Redford; Per Curiam 
Official Michigan Reporter Citation: Not Applicable; Link to Opinion

General / Miscellaneous [§3115]

Interpretation of Insurance Contracts 

In this unanimous, unpublished, per curiam decision, the Court of Appeals affirmed the trial court’s summary disposition order dismissing Defendant Farmers Insurance Exchange’s (“Farmers”) crossclaim against Co-Defendant Geico Indemnity Company ("Geico") for reimbursement of no-fault PIP benefits Farmers paid to Plaintiff Beth Bracy.  Applying the priority scheme set forth in the former MCL 500.3115(1), the Court of Appeals held that Geico was not in the order of priority for payment of Bracy’s PIP benefits with respect to the subject motor vehicle-versus-pedestrian collision, because while Geico insured the vehicle which crashed into Bracy, the vehicle’s owner, registrant, and operator at the time, Yolanda Nichols, was not a named insured on the policy.

Beth Bracy was injured as a result of being struck by a Chevrolet Lumina driven by Yolanda Nichols.  Bracy did not have her own no-fault insurance policy at the time of the incident, but the Lumina involved in the crash was insured under Nichols’s son’s no-fault policy with Geico.  Nichols’s son’s policy listed Nichols as a driver of the Lumina, it did not list her as a named insured.  Thus, Bracy filed a claim for PIP benefits with the Michigan Assigned Claims Plan (“MACP”), which, in turn, assigned her claim to Farmers.  Farmers paid Bracy’s benefits for a period but stopped after learning of Nichols’s son’s Geico policy.  Bracy eventually filed suit against both Farmers and Geico, and Farmers filed a crossclaim against Geico for reimbursement under MCL 500.3172.  The parties conceded that the previous version of the No-Fault Act—that which existed prior to the amendments set forth in 2019 PA 21 and 2019 PA 22—applied to the case, and the ultimate issue in the case became whether Geico was responsible for Bracy’s benefits under the former MCL 500.3115(1).  Farmers argued that Geico was responsible because the Geico policy’s definition of ‘persons insured’ included the policyholder’s ‘relatives,’ whereas Geico argued that it was not the responsible insurer because, among other provisions, its policy defined ‘relative’ as ‘a person residing with you, and related by blood . . . provided neither such relative nor his/her spouse owns a private passenger, farm or utility auto.’  Based on this policy language, the trial court granted summary disposition in Geico’s favor.

The Court of Appeals affirmed the trial court’s summary disposition order, holding that Geico was not the responsible insurer  for purposes of the former MCL 500.3115(1). The Court determined that multiple policy provisions, including that which defined ‘relative,’ made clear that Nichols was not an insured person under the policy, and that Farmers, therefore, was responsible for Bracy’s claim as the assigned insurer.

“We reject Farmers’ argument that Nichols was an ‘insured’ under the Geico policy because she met the definition of ‘persons insured’ as set forth in Section I. While ‘persons insured’ does include the policyholder’s ‘relatives’ Nichols was not a “relative” within the contemplation of insurance coverage. The “Definitions” set forth in Section I, include ‘Relative’ in Paragraph 8, which means: ‘a person residing with you, and related by blood . . . provided neither such relative nor his/her spouse owns a private passenger, farm or utility auto.’ While Nichols’s testimony regarding whether she resided with Marcus at the time of the accident is contradictory, it is undisputed that Nichols was the owner of the Lumina. Therefore, because Nichols owned a private passenger automobile, she does not qualify under the ‘persons insured’ section of the policy and Geico is not responsible for Bracy’s PIP benefits. 

Further, Section II, Part 1 of Geico’s policy addresses PIP coverage: 

We will pay for personal injury protection benefits to or on behalf of each eligible injured person for allowable expenses, work loss and survivors’ benefits incurred as a result of bodily injury caused by an accident arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle. 

The ‘Definitions’ section of Section II, Part 1, Paragraph 3, Subsection (c) defines an ‘eligible injured person’ to include ‘[a]ny other person who suffers bodily injury while a pedestrian through being struck by an insured auto[.]’ And Paragraph 5 proceeds to define an ‘insured auto’ as ‘an auto with respect to which you are required to maintain security under Chapter 31 of the Michigan Insurance Code and to which the Bodily Injury liability coverage of this policy applies and for which a specific premium is charged.’ MCL 500.3101(1) mandates, with limited exceptions not applicable here, that ‘the owner or registrant of a motor vehicle required to be registered in this state maintain security for payment of benefits under personal protection insurance and property protection insurance . . . .’ But in this case, it is undisputed that Marcus was neither the owner nor registrant of the Lumina; thus, the Lumina was not an auto for which he was ‘required to maintain security under Chapter 31 of the Michigan Insurance Code[.]’ Accordingly, Bracy was not an ‘eligible injured person’ under the terms of the Geico policy.” 

Michigan auto accident attorney Stephen Sinas is the lead editor of the appellate case summaries published on this site regarding the Michigan auto insurance law. To learn more about how Stephen Sinas and how the Sinas Dramis Law Firm can help you if you have been injured in a Michigan auto accident, visit

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