Injured? Contact Sinas Dramis for a free consultation.


El-Najjar v Wilson (COA - UNP; 1/26/2017; RB # 3607)


Michigan Court of Appeals; Docket # 329468; Unpublished  
Judges Beckering, Sawyer and Saad; Unanimous, Per Curiam  
Official Michigan Reporter Citation: Not Applicable; Link to Opinion


Exception for Employer Provided Vehicles [§3114(3)]


Not Applicable


In this unanimous unpublished per curiam Opinion involving a priority dispute between insurers, the Court of Appeals held the trial court improperly granted summary disposition to Argonaut Midwest Insurance because questions of fact remained about whether the injured plaintiff was self-employed within the meaning of MCL 500.3114(3) at the time of his auto accident.

Plaintiff claimed he was injured when defendant David Wilson crashed into the 2003 Nissan that plaintiff was driving. The Nissan was owned by Conz Auto, a used car business solely owned by plaintiff. Conz Auto was insured under a “garage coverage” policy issued by Argonaut Midwest Insurance that included PIP benefits. Plaintiff’s personal vehicles were covered under a policy issued by Allstate that named plaintiff as an insured and also included PIP benefits. When both Allstate and Argonaut denied plaintiff’s claim for both PIP and uninsured motorist (UM) benefits, plaintiff filed this action against Wilson and the various insurance companies, seeking UM and PIP benefits, as well as damages arising from Wilson’s alleged negligence. At his deposition, plaintiff testified that he purchased Conz Auto for investment purposes, that he was not involved in the day-to-day operations of the business or involved in the handling the books, and that he did not purchase cars for the business. He claimed that, on the day of the accident, he had taken the Nissan for a “test drive” to see if he wanted to buy it. Plaintiff testified the car was repaired after the accident, it was in his possession at the time of his deposition because he intended to buy the car. Meanwhile, several Conz Auto employees were also deposed. One employee testified that plaintiff was “the boss” – that he purchased the cars for sale, set the prices, paid the employees, sold cars, purchased parts and supplies, handled insurance coverage and made “significant” business decisions. He testified that, while plaintiff worked at a bank, he was at Conz Auto two to four times a week. Based on the deposition testimony, Argonaut moved for summary disposition, asserting that plaintiff was not an employee and that, at the time of the accident, plaintiff was a named insured on the Allstate policy that provided PIP benefits and, therefore, Allstate had priority to pay benefits. Allstate argued a question of fact existed regarding whether plaintiff was an “employee” of Conz Auto for purposes of §3114(3). Allstate claimed that plaintiff was an employee and his activities on behalf of Conz Auto constituted self-employment, thereby making §3114(3) applicable under Celina Mutual Ins Co v Lake States Ins Co,452 Mich 84 (1996). In response, Argonaut argued that, under the economic reality test, plaintiff was not an employee because he could not be both a full-time employee of a bank and self-employed by Conz Auto. According to Argonaut, there was no case law holding that the owner of a business purchased for investment purposes is an employee of that business. The trial court granted Argonaut’s motion for summary disposition, finding that Allstate could not show that plaintiff was a self-employed sole proprietor of Conz Auto.

The Court of Appeals reversed, holding that the deposition testimony of certain Conz Auto employees created a genuine issue of material fact regarding plaintiff’s status as a self-employed proprietor of Conz Auto. In reaching this conclusion, the Court of Appeals relied on Celina, where the Michigan Supreme Court held that the protections of the workers’ compensation system afforded to employers does not apply in the sole proprietorship context. Quoting Celina, the Court of Appeals said:

“We believe that it is most consistent with the purposes of the no-fault statute to apply § 3114(3) in the case of injuries to a self-employed person. The cases interpreting that section have given it a broad reading designed to allocate the cost of injuries resulting from use of business vehicles to the business involved through the premiums it pays for insurance.”

The Court of Appeals pointed out that Argonaut based its summary disposition motion on the inapplicability of §3114(3) because plaintiff was not an employee of Conz Auto and was not involved in the daily operations of the business. However, the Court said Allstate presented deposition testimony indicating that plaintiff purchased cars to sell, was involved in the purchase of parts and supplies, set the selling price of cars, sold cars to customers, paid the employees, handled insurance coverage for the business and made significant business decisions.

Based on the foregoing, the Court of Appeals concluded that materials questions of fact existed about plaintiff’s involvement in Conz Auto which precluded summary disposition. The Court held: 

“Argonaut’s assertion that full-time employment at one place precludes part-time self-employment as sole proprietor of a business assumes a definition of self-employed for which Argonaut cited no authority, and the parties provided no briefing. Further, by concluding that Allstate could not ‘demonstrate’ or ‘prove’ that plaintiff was self-employed, the trial court demanded not only that Allstate ‘set forth specific facts showing that a genuine issue of material fact exists[,]’ … but also that the facts show that Allstate would ultimately prevail on the issue. In addition, the trial court’s conclusion is tantamount to a finding of fact that plaintiff is not self-employed. Such is contrary to the guidance this Court provided trial courts … to the effect that courts should be ‘liberal’ in finding questions of material fact and ‘carefully avoid making findings of fact under the guise of determining that no issues of material fact exist. … [W]e conclude that Allstate presented specific facts in the form of deposition responses from [Conz Auto employees] that, viewed in the light most favorable to Allstate, show that there remain questions of material fact about plaintiff’s involvement in Conz Auto, and whether such involvement constitutes self-employment. Therefore, we reverse the trial court’s order granting summary disposition to Argonaut and remand the matter to the trial court for further proceedings.”

Lansing car accident lawyer 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

Copyright © 2022 Sinas Dramis Law Firm, George Sinas, Stephen Sinas.
All Rights Reserved.
Login (Publishers Only)