Michigan Court of Appeals; Docket # 330706; Unpublished
Judges Riordan, Meter and Fort Hood; Unanimous, per curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Exclusions from Underinsured Motorist Benefits
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals reversed the trial court’s ruling that plaintiff Stephen Growe’s (“Growe”) was entitled to underinsured motorist benefits under his insurance policy. The Court reversed the trial court on the basis that Growe was ineligible for benefits under the clear language of the policy, which had to be enforced as written.
Growe claimed that a vehicle driven by Ashley Woodfin and owned by Annette Woodfin negligently struck him while he was operating his motorcycle, causing him serious injury. Growe alleged Annette was liable based on the owner’s liability statute, MCL 257.401, and that Ashley was liable for failing to drive properly. Growe had an insurance policy on his two automobiles with defendant Home-Owners and made a claim for underinsured motorist (UIM) benefits. When Home-Owners denied the claim, Growe filed this action for benefits. Home-Owners moved for summary disposition, arguing that the motorcycle was insured under a policy with another company, Harley-Davidson Insurance. Home-Owners further asserted that the policy Growe had on his automobiles contained an exclusion for UIM coverage if the injured person was occupying an automobile owned or leased by him or her and the automobile was (1) designed primarily for use on public roads, (2) required to be registered and licensed, and (3) not insured for UIM coverage under the policy. Home-Owners claimed that Growe’s motorcycle qualified as an automobile and that the other conditions applied, making Growe ineligible for UIM coverage. Growe, however, contended that he was not occupying either of the automobiles listed in his policy and, therefore, UIM coverage applied. Specifically, plaintiff argued the exclusion was inapplicable because it used the phrase “any person” instead of “you” (meaning plaintiff), and the policy as a whole made a distinction between “any person” and “you.” The trial court denied Home-Owners’ motion for summary disposition.
The Court of Appeals reversed, finding that summary disposition should have been granted for Home-Owners. In so ruling, the Court examined the following applicable language in plaintiff’s insurance policy:
2. COVERAGE
a. We will pay compensatory damages, including but not limited to loss of consortium, any person is legally entitled to recover from the owner or operator of an underinsured automobile because of bodily injury sustained by an injured person while occupying an automobile that is covered by SECTION II – LIABILITY COVERAGE of the policy.
b. This coverage is extended to you, as an individual as follows:
(1) We will pay compensatory damages, including but not limited to loss of consortium, you are legally entitled to recover from the owner or operator of an underinsured automobile because of bodily injury you sustain:
(a)when you are not occupying an automobile that is covered by SECTION II – LIABILITY COVERAGE; or
(b)when occupying an automobile you do not own which is not covered by SECTION II – LIABILITY COVERAGE of the policy.
…
3. EXCLUSIONS
Underinsured Motorist Coverage does not apply:
…
b. to any person injured while occupying or injured by any automobile which is owned or leased by such person injured if such automobile:
(1) is designed primarily for use on public roads;
(2) is required to be registered and licensed prior to its use on public roads; and
(3) is not insured for Underinsured Motorist Coverage by the policy.
Looking at these policy provisions, the Court of Appeals said it was “undisputed” that Growe’s motorcycle was designed primarily for use on public roads, was required to be registered and licensed, and was not insured for UIM coverage. In so finding, the Court rejected Growe’s claim that the reference to “any person’ in §3(b) of the policy did not apply to Growe because other sections of the policy specifically referenced to the named insured (plaintiff) as “you.” Based on this, the Court said plaintiff’s argument was “untenable” and that it “border[ed] on specious” to assert that the broad phrase “any person” did not include plaintiff. “We must enforce clearly-worded insurance clauses as written,” the Court held.
The Court of Appeals further found the trial court erred by invoking the doctrine of illusory coverage, which provides that a policy may not include a provision for coverage that is functionally nonexistent. “We note that plaintiff does not even invoke the illusory-coverage doctrine,” the Court stated.
Accordingly, “[t]he wording of the policy is unambiguous and we must rule in favor of defendant,” the Court of Appeals concluded.
