Michigan Court of Appeals; Docket No. 17778; Unpublished
Judges Jansen, Hoekstra, and Langford-Morris; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Not Applicable
TOPICAL INDEXING:
Uninsured Motorist Benefits
Private Contract (Meaning and Intent)
CASE SUMMARY:
In this unanimous per curiam unpublished Opinion, the Court of Appeals affirmed summary disposition in favor of the defendant insurer in a declaratory relief action where plaintiff attempted to stack third party liability coverages under two separate policies. The Court of Appeals found that the language of the subject insurance policies unambiguously precluded coverage under the circumstances of this case.
The plaintiff was injured while riding a motorcycle in a collision with a 1983 Ford van being driven by William Gargin. The van had been purchased by an individual named Seyed Sam prior to the collision. However, Sam had not recorded or transferred the title. Sam was the owner of a corporation known as K.T. Opportunity, Inc. and Gargin was an independent contractor working under contract with K.T. At the time of the accident, K.T. was insured under a number of insurance policies issued by defendant State Farm. However, the van was insured with Automobile Club Insurance Association (ACIA) in Sam's name alone.
Plaintiff brought suit seeking third-party residual liability against Gargin and K.T. which settled for the sum of $175,000. Plaintiff received $100,000 from ACIA, which was apparently the coverage limits under, the policy insuring the van. Plaintiff then brought the subject declaratory relief action against defendant State Farm seeking coverage under several policies issued by State Farm to K.T.
The trial court granted summary disposition in favor of defendant State Farm after determining that no coverage was available under any of the policies for the damages claimed by plaintiff. The Court of Appeals affirmed.
First, plaintiff claimed coverage under an umbrella policy issued to defendant K.T. The court found that even assuming that coverage existed under this policy, the terms of the policy provided for a "retained limit" or deductible in the amount of $500,000. As plaintiffs damages in this case ($175,000), less other insurance coverage ($100,000), totaled $75,000, the retained limit was not exhausted and, therefore, no umbrella coverage was available.
Plaintiff next claimed defendant was liable under a business policy covering Sam individually for liability incurred in the conduct of his business. However, this policy contained an exclusion for bodily injury arising out of the entrustment to others of an auto owned or operated or rented or loaned by any insured. Plaintiff argued that this exclusion did not apply because Sam, not K.T., was the owner of the accident vehicle. However, the court held that this exclusion from coverage applied, regardless of whether Sam was the owner of the vehicle, because if he was not, the vehicle nonetheless was loaned by Sam to Gargin as an independent contractor at the time of the collision, thereby triggering the exclusion.
Next, plaintiff sought coverage under five separate automobile policies issued to K.T., each of which provided coverage for liability arising from the use of a "non-owned car." The record indicated that Sam was the owner of the accident vehicle, as he had paid the purchase price and insured the vehicle in his name under the ACIA policy. While State Farm's policies provided for coverage for the use of a "non-owned vehicle," that coverage only extended to the person named in the declarations in the policy, which here, was K.T. Since the vehicle was not used by an employee of K.T. at the time of the accident, coverage was not provided under the State Farm automobile policies.
