Michigan Court of Appeals; Docket #231898; Unpublished
Judges Talbot, Neff and Fitzgerald; unanimous; per curiam
Official Michigan Reporter Citation: Not Applicable, Link to Opinion 
STATUTORY INDEXING:
Not applicable
TOPICAL INDEXING:
Uninsured Motorist Benefits: Arbitration of Uninsured Motorist Claims
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals upheld denial of plaintiff’s claim for uninsured motorist coverage under either of the two automobile insurance policies applicable to her claim, based upon failure of the plaintiff to comply with the notice of claim provisions contained in those policies.
Plaintiff sustained injuries on February 18, 1998 while a passenger in a motor vehicle that collided with another motor vehicle which was uninsured. Plaintiff’s own State Farm policy provided for uninsured motorist coverage of $100,000 per person. However, State Farm limits its coverage in the instance where the named insured sustains bodily injury while an occupant of a vehicle not owned by the named insured and the driver of the vehicle is insured under another policy which provides uninsured motorist coverage. In that instance, the State Farm coverage is excess to any other uninsured motorist coverage which applies to the vehicle.
State Farm’s policy also requires that the insured give State Farm written notice of the accident and pertinent details as soon as “reasonably possible.” The policy also requires that a person making a claim for uninsured motorist coverage must send State Farm a copy of all suit papers at once when the party liable for the accident is sued for damages.
The driver of the vehicle in which plaintiff was injured was insured by ACIA for $100,000 per person of uninsured motorist coverage. That policy also contains a requirement that the insured person must file a demand within three years of the date of the accident in order to invoke the arbitration procedures of the policy.
On November 7, 1994, plaintiff brought a tort action against the uninsured motorist. The driver was voluntarily dismissed on April 5, 1996, after the court entered a default judgment in the amount of $125,000 against the uninsured motorist.
On July 29, 1998, more than five years after the accident, plaintiff made a written request for State Farm to arbitrate her claim for uninsured motorist benefits. On February 16, 1999, plaintiff made a demand upon ACIA to arbitrate her claim for uninsured motorist coverage.
As to the claim against State Farm, the Court of Appeals concluded that plaintiff’s failure to comply with the insurance contract’s notice provisions precluded plaintiff from recovering under the State Farm policy. It is undisputed that plaintiff failed to provide State Farm with notice of and copies of papers related to the suit that she filed against the uninsured motorist until more than five years after the accident and more than two years after the entry of the default judgment. Therefore, the Court of Appeals held that plaintiff had failed to provide notice of her lawsuit “at once,” as required by the policy.
Additionally, the Court of Appeals held that State Farm was prejudiced by the delay because any claim by State Farm to seek reimbursement from ACIA was “time barred” under the terms of the ACIA policy which requires a claim for uninsured motorist benefits to be made within three years of the date of the accident. In failing to comply with the notice provisions contained in the State Farm policy, State Farm was deprived of the opportunity to seek reimbursement from ACIA, to investigate the claim, to cross-examine witnesses, and to present its own evidence relative to liability and damages.
Further, the court rejected plaintiff’s claim that the filing of her claim for first-party benefits with State Farm on the day after the accident would be sufficient notice to provide notice of a potential additional claim for uninsured motorist benefits.
With regard to the claim against ACIA, the Court of Appeals held that plaintiff, as a third-party beneficiary under that contract, must comply with the terms of the contract. The provision that a demand for arbitration must be filed within three years of the date of the accident is clear and unambiguous. It was undisputed that plaintiff did not seek uninsured motorist benefits from ACIA until more than five years after the accident and, therefore, her claim was barred.
