Michigan Court of Appeals; Docket No. 177355; Unpublished
Judges O'Connell, Gribbs, and Pickard; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
General Rule of Priority [§3114(1)]
Exception for Employer Provided Vehicles [§3114(3)]
Definition of Owner [§3101(2)(h)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous per curiam Opinion involving a priority dispute between a truck driver's personal no-fault insurer and the insurer of the semi-truck he was operating at the time of the accident, the Court of Appeals ruled that priority liability for payment of PIP benefits rested with the truck driver's personal insurer.
The semi-truck involved in this case was the subject of a motor vehicle agreement between the trucker (Paul Curtis) and Ranger Transportation. Curtis leased the truck to Ranger and Curtis operated it pursuant to an independent contractor agreement. Curtis' personal vehicle was insured by defendant Auto Owners. Plaintiff National Union insured Ranger. The motor vehicle lease agreement between Curtis and Ranger was, in essence, a long-term lease, giving Ranger exclusive possession, control and use of the truck during the term of the lease, which was for a period of greater than 30 days. Although this lease agreement was enough to make Ranger the "owner" of the truck under §3101 (2)(g), the Court of Appeals affirmed the trial court's conclusion that Curtis was not an "employee" of Ranger. If Curtis is not an employee of Ranger, then Ranger's insurer, plaintiff National Union, was not obligated to provide PIP benefits under the provisions of §3114(3) which specifically refers to an "employee" injured while occupying a vehicle owned or registered by his employer.
In ruling that Curtis was not an employee of Ranger, the court utilized the "economic reality test" implemented in previous decisions. Under this test, the factors to be considered include control of the worker's duties, payment of wages, right to hire, fire and discipline, and control of the performance of duties. The court then examined the relationship between Ranger and Curtis and found it to be a true independent contractor relationship. Curtis was responsible for all costs associated with the equipment, fuel, repairs, taxes, plates, permits, etc. Curtis had the right to accept or reject any freight that Ranger wanted transported and Curtis also retained the right to determine the manner in which the freight was to be delivered. Curtis was permitted to hire his own employees and was solely responsible for his employees' compensation, direction and discharge. Ranger compensated Curtis on a load-by-load basis and Ranger withheld no taxes from its compensation to Curtis. The agreement was terminable at will and specifically was characterized as an independent contractor relationship. Under the economic reality test, Curtis was not an employee of Ranger, and therefore, Ranger's insurer was not obligated to pay benefits under §3114(3). Priority for PIP benefits rested with Curtis' personal automobile insurer, defendant Auto Owners.
