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Lacey v Auto Club Ins Ass’n (COA – UNP; 4/10/2018; RB #3732)


Michigan Court of Appeals; Docket No. 335580; Unpublished
Judges Servitto, Markey, and O’Connell; per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 

Definition of Owner [§3101(2)(h)]
Exception for Employer Provided Vehicles [§3114(3)]
Exception for Occupants [§3114(4)] 


In this unpublished per curiam opinion involving a priority dispute between no-fault insurers, the Michigan Court of Appeals reversed the trial court after finding that ownership of the vehicle involved in the accident created a material question of fact.  The Court held that the trial court erred when it granted summary disposition to the vehicle’s insurer but found the vehicle’s title holder solely liable.  The case was remanded for a multifactorial analysis of the ownership issue.

Plaintiff, Steven Lacey, was injured in a single-vehicle accident.  At the time, he was driving a pick-up truck furnished by his employer, Michigan Wildlife Rescue, LLC (MWR).  Jennifer, the wife of MWR’s co-owner, held the title to the truck.  Jennifer had several other vehicles insured through Auto Club Insurance Association (ACIA), but the truck was not one of the covered vehicles.  Dana, the wife of the other co-owner, had the truck insured through Progressive Marathon Insurance Company. 

Plaintiff filed a suit seeking PIP benefits and listed ACIA and Progressive as defendants.  He also listed “the Michigan Assigned Claims Plan, and the Michigan Automobile Insurance Placement Facility as [co-]defendants, alleging that one or more of those entities had priority to pay his PIP benefits.”  The insurers filed competing motions for summary disposition. Progressive and ACIA each relied on different subsections of MCL 500.3114 to establish why the other insurer held a higher priority.   The trial court ruled that ACIA, as Jennifer’s insurer, was solely responsible to pay all of plaintiff’s PIP benefits pursuant to MCL 500.3114(4).  Accordingly, the trial court granted the other insurers, including Progressive, summary disposition.  On appeal, Progressive argued that the trial court erred when it granted ACIA’s motion. 

The issue before the Court was whether the exception described in MCL 500.3114(3) applied and, if not, how section 500.3114(4) applied to the facts of this case.  In this case, if subsection (3) were applied, then the responsible insurer would be Progressive—Dana’s insurer.  Alternatively, if subsection (4) were applied, then Jennifer’s insurer, ACIA, would be the responsible insurer.

First, the Court found that MWR was a corporate person for the purposes of the no-fault statute.  It held that the trial court erred when it determined that MWR—a corporation—could not be an owner because its employees did not have “exclusive” use of the involved vehicle for greater than 30 days.  The statute defined an owner as a “person renting a motor vehicle or having the use thereof, under a lease or otherwise, for a period that is greater than 30 days.” MCL 500.3101(2)(h)(i) (emphasis added).  Therefore, because a vehicle may have more than one owner, exclusive use is not required to prove ownership.  In this regard, the Court noted: 

Nothing in the plain language of former MCL 500.3101(2)(h)(i) requires exclusive use. Rather, the trial court seems to have conflated the no-fault act’s definition of owner, which does not require exclusive use, with the Michigan Vehicle Code’s definition of that same term, at MCL 257.37, which does require exclusive use. [W]hile reference to the Vehicle Code may be used to clarify the meaning of a term used in the no-fault act, it cannot be used to change the meaning of a term specifically defined in the no-fault act.  [Internal quotations omitted.]

Next, the Court held that the trial court further erred when it applied principles of contract law to plaintiff’s PIP claim.  Contrary to the trial court’s reasoning, plaintiff was not precluded from receiving benefits simply because no named insured was injured in the crash. The owner of the vehicle need not have been injured in the same crash to trigger coverage.  Plaintiff’s entitlement to PIP benefits was governed solely by State statute, not contract law.  Accordingly, plaintiff was not required to be in privity with ACIA to receive benefits.  The Court stated in pertinent part:

Any clause in a no-fault policy attempting to limit an insurer’s liability to less than that mandated by statute is void as against public policy.  Therefore, the fact that no named insured was involved in the accident is not dispositive. The trial court erred by failing to recognize that MCL 500.3114(3) arises from the injured person’s connection to the motor vehicle involved in the accident, not from the contractual definition of a named insured.

Lastly, the Court found that a genuine issue of material fact existed as to whether Jennifer and MWR were owners of the truck.  The issue of ownership is dispositive and should be inferred from the circumstances.  The Court found relevant the following factors relevant, among others:

[Plaintiff] testified (1) that he began working for MWR about six months before the accident, (2) that he worked approximately 40 to 45 hours each week, during which time he drove one of several “company” vehicles, (3) that the pickup truck was one of those vehicles, (4) that he switched company vehicles “pretty regularly” but might have used the pickup truck more than any other vehicle, (5) that he used the pickup truck over 20 times, (6) that his “bosses,” . . . referred to it as “a company truck” and told [plaintiff] that it was his “work vehicle,” (7) that they had equipped the pickup truck with a GPS device in order to track its location, and (8) that they told [plaintiff] that if he had any problems with the vehicle, he should return it to them for maintenance.  Additionally, MWR is a closely held family business; the pickup truck’s title owner (Jennifer) is married to one of MWR’s two owners, and the pickup truck was stored with MWR’s company vehicles, not at Jennifer’s residence.

Progressive, Jennifer’s insurer, contended that neither MWR nor Jennifer’s husband had continuous access to the truck for 30 days, and, therefore, they could not be owners under the policy.  If the facts support this proposition, then ACIA would become the liable insurer according to MCL 500.3114(3).  But ownership does not rest on one’s actual use of the vehicle.  The Court explained that the analysis turns on the particular arrangement and plaintiff’s right to use the involved vehicle.

[T]his factual issue is decidedly material to the priority dispute between ACIA and Progressive. If MWR were one of the pickup truck’s owners, then Progressive would, as the insurer of the furnished vehicle, have priority under MCL 500.3114(3) to pay all of [plaintiff’s] PIP benefits in this matter.

Ultimately, the Court remanded the case to the trial court to make determinations consistent with this opinion.

From this evidence, a rational trier of fact could reasonably infer that despite Jennifer’s title ownership, MWR had the right to exercise proprietary control over the pickup truck throughout [plaintiff’s] entire period of employment, which far exceeded 30 days. . . . A genuine issue of fact exists whether the pickup truck’s pattern of use over a six month period establishes that MWR was one of the truck’s owners.

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

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