Michigan Court of Appeals; Docket No. 135663; Published
Judges Shepherd, Brennan, and Borrello; Unanimous; Per Curiam
Official Michigan Reporter Citation: 199 Mich App 202; Link to Opinion 
STATUTORY INDEXING:
Compulsory Insurance Requirements for Owners or Registrants of Motor Vehicles Required to Be Registered [§3101(1)]
Scope of Mandated Coverages [§3131(1)]
General / Miscellaneous [§3135]
TOPICAL INDEXING:
Reformation of Insurance Contracts
CASE SUMMARY:
In this unanimous published per curiam Opinion, the Court of Appeals held that a liability exclusion in an automobile policy that disallowed coverage for an injury arising out of the operation of farm machinery, even though the injury also arises out of the use of a motor vehicle, is an invalid exclusion because it violates public policy.
This case involved a dispute between two insurance companies about how a settlement in an underlying wrongful death action should be proportioned between them. The decedent was killed when his car collided with the rear of a farm combine that was completely blocking the roadway. The combine was connected to an auger that was conveying harvested corn to a pickup truck that was parked adjacent to the roadway. The decedent's vehicle struck the combine but did not strike the pickup truck. The dispute was between plaintiff insurer who insured the combine under a farm liability policy and defendant insurer who insured the pickup truck under an automobile no-fault policy. The no-fault policy provided residual tort liability coverage for bodily injury that "arose out of the ownership, maintenance or use of a motor vehicle." However, the automobile policy also contained an exclusion disallowing coverage for bodily injury arising out of the operation of farm machinery. The Court of Appeals held that the exclusion violated public policy because it conflicted with the liability coverage required by the no-fault statute. The No-Fault Act provides that liability arising out of the use of a motor vehicle is retained in cases involving death (see §3135). In addition, §3131 requires that every insurance policy issued in this state include coverage for all liability retained by the Act. Under the facts of this case, the Court of Appeals held that a disputed question of fact existed as to whether a sufficient causal nexus existed between the pickup truck and the accident so as to say that the decedent's death arose out of the use of the truck. In concluding that this was not an issue that was proper for summary disposition, the court stated, "Here, the combine, the auger and the truck were so closely intertwined that reasonable minds could conclude that they constituted a single unit whose purpose was to unload harvested corn. Even though the truck was parked alongside the road and was not struck by the car, it is a disputed factual issue whether the truck, and operating as part of this single unit, caused the accident. Viewed in this manner, the relationship of the truck to the accident was more than simply fortuitous, incidental, or but for."
The court held that if the trier of fact concludes that a sufficient causal nexus exists between the use of the truck and the decedent's death so that the death arose out of the use of the truck, then coverage exists under the no-fault policy regardless of the exclusion. In this regard, the court stated, "Stated in other terms, the public policy of this state has been declared by the Legislature to require no-fault coverage if a motor vehicle is involved in an accident. The parties to an insurance contract may not defeat that policy by agreement"
