Michigan Court of Appeals; Docket #301328; Unpublished
Judges Cavanagh, Sawyer, and Meter; unanimous; per curiam
Official Michigan Reporter Citation: Not Applicable, Link to Opinion 
On June 25, 2012, the Michigan Supreme Court DENIED Application for Leave to Appeal; Link to Order
STATUTORY INDEXING:
General Rule of Priority [§3114(1)]
Exception for Occupants [§3114(4)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous unpublished per curiam Opinion involving a priority dispute between two no-fault insurers, the Court of Appeals reversed and remanded the trial court determination that Titan Insurance Company was responsible for payment of the no-fault benefits to Jerald Sours who was injured as an occupant of a motor vehicle.
Jerald was a passenger in a vehicle that was owned and operated by Nakeysha Vond. Sours did not have automobile insurance and, therefore, was not entitled to coverage under §3114(1), the general rule of priority. Further, Vond's vehicle was uninsured but she resided with her father who had a no-fault policy issued by Westfield Insurance Company.
Sours personal protection insurance benefits were paid by Titan Insurance pursuant to an assignment under the Assigned Claims plan. MCL 500.3172(1). Litigation was commenced and Titan filed a claim against Westfield, alleging that Westfield was higher in priority under MCL 500.3114(4) and thus, responsible for Sours' insurance benefits. The trial court granted summary disposition in favor of Westfield on the ground that Vond was not an "insured" within the meaning of her father's Westfield policy.
In reversing and remanding the trial court determination, the court first noted that §3114(4) of the No-Fault Act provides that the injured person seek benefits as an occupant from the "insurer of the owner or registrant of the vehicle occupied," and second, from the "insurer of the operator of the vehicle occupied." There was no dispute that Vond was both the owner and operator of the vehicle Sours was occupying when he sustained his injuries. The critical issue of priority in this case was whether Westfield was the "insurer of the owner" and the "insurer of the operator" for purposes of §3114(4).
In analyzing the issue, the court stated that the Westfield policy of insurance under the "liability coverage section" provided that Westfield would pay "damages for bodily injury or property damage for which any insured becomes legally responsible because of an auto accident." The policy further defined an "insured" as "you or any family member for the ownership, maintenance or use of any auto or trailer." A family member was defined as a person "related to you by blood who is a resident of your household."
The Court of Appeals held that from this contractual language, it is clear that for purposes of §3114(4), Vond was an "insured" of Westfield and, thus, Westfield was "the insurer of the owner" and "the insurer of the operator" of the vehicle occupied by Sours.
The court noted that the facts of this case are similar to those presented in Amerisure Ins Co v Coleman, 274 Mich App 432 (2007).
The court rejected Westfield's contention that the case is distinguishable from Coleman on the basis of a policy exclusion which would negate liability coverage under the circumstances of this case. The court stated that this exclusion is not relevant to defining who is an insured for purposes of §3114(4). The exclusion merely sets forth a circumstance not covered by insurance. It is the presence of a contractual insured/insurer relationship, not the terms of that relationship, which is the determinative inquiry for defining the "insurer" under the plain language of §3114(4).
In summary, the court held that Westfield was the insurer of Vond who was the owner and operator of the vehicle occupied by Sours when he sustained his injuries. Therefore, under §3114(4), Westfield was higher in priority than Titan.
