Michigan Court of Appeals; Docket No. 116016; Published
Judges Neff, Wahls, and T.G. Kavanagh; Unanimous
Official Michigan Reporter Citation: 183 Mich App 626; Link to Opinion 
STATUTORY INDEXING:
General Rule of Priority [§3114(1)]
Exception for Commercial Vehicles [§3114(2)]
Exception to General Priority for Non-Occupants [§3115(1)]
Reimbursement to Servicing Insurer or ACF [§3172(3)]
Interest Rate Liability for Payments Due [§3175(4)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous Opinion by Judge Wahls, the Court of Appeals affirmed the decision of the trial court as to a dispute between two insurance companies under the assigned claims provisions of the No-Fault Act regarding which paid benefits on behalf of a minor child who was struck by a motor vehicle while crossing in front of a school bus. The dispute concerned the priority of payments as between Citizens Insurance, the company for the vehicle which struck the child, and Farm Bureau Insurance Company, the insurance company for the bus.
In this case, Thomas Chadwick, a 12-year old, was struck by a motor vehicle insured by Citizens as he attempted to cross the road in front of a school bus from which he had just alighted. The bus operator had activated the bus' warning flashers, and brought the bus to a complete stop on the opposite of the road from Chadwick's house. When he exited the bus and started across the street in front of the bus under the protection of the flashers, he was struck by Citizens' insured after entering the oncoming traffic lane. The bus was still present with its warning flashers activated when he was struck by Citizens' insured.
Since there was no personal protection insurance policy in the Chadwick household, under the priority provisions of the No-Fault Act, benefits would come either from the insurance company for the striking vehicle, or from the insurance company for the school bus. Both companies denied benefits, and Michigan Mutual was assigned the claim under the assigned claims provision of the Act.
Citizens argued that Chadwick was a "passenger" of the school bus, and consequently, Farm Bureau as insurer of the school bus should be responsible for his no-fault benefits under the provisions of §3114(2)(a). That section provides that a person suffering accidental bodily injury while a passenger of a motor vehicle operated in the business of transporting passengers, shall receive the personal protection insurance benefits to which the person is entitled from the insurer of the motor vehicle. However, that section also states that it shall not apply to a passenger in a school bus unless that passenger is not entitled to benefits under any other policy.
Citizens argued that the word "passenger" was not limited to occupants of motor vehicles, and included persons in Chadwick's position at the time of the accident. In affirming the trial court, the Court of Appeals held that the word "passenger" as used in §3114(2) must be given its generally understood meaning, and thus should be interpreted to mean "an occupant" of a motor vehicle. Since Chadwick was not an occupant of the school bus at the time of the accident, and had already exited from the bus, he was not a passenger of the bus under §3114(2).
The court held that under §3115(1), the priority of responsibility for Chadwick's benefits is determined by that section which provides that a person injured while not an occupant of a motor vehicle shall claim personal protection insurance benefits from insurers of owners or registrants of motor vehicles "involved in the accident."
Citizens argued below that the school bus was also "involved in the accident," and consequently Farm Bureau should share responsibility with Citizens for Chadwick's no-fault benefits
In rejecting this argument, the court noted that in order for a motor vehicle to be included within the category of motor vehicles "involved in the accident" under §3115(l)(a) there must be some activity of the motor vehicle which actively, as opposed to passively, contributes to the happening of the motor vehicle accident Brasher v Auto Club Insurance, 152 Mich App 544 (1986).
Here, there was nothing that the bus in this case actually did that even arguably caused Citizens' insured to strike Chadwick. In order for the bus in this case to be included in the category of motor vehicles involved in the accident under §3115(l)(a), there must have been some activity of the school bus as a motor vehicle which actively contributed to the happening of the accident. The school bus' contribution to the accident was simply a "but for" contribution, in that it could be argued that "but for" the fact that the school bus was physically present, Chadwick would not have been in a position for Citizens' insured to strike him. In this case, "but for" causation alone is insufficient to impose liability for benefits.
Finally, the Court of Appeals affirmed the trial court order for benefits, as well as reasonable attorney fees and interest at the rate prescribed in §3175 of the No-Fault Act. The court stated that under §3172(3)(f), the trial court does not need to find that the insurer "unreasonably refused" the claim before attorney fees may be charged against the insurer.
