Michigan Supreme Court; Docket No. 74502; Published
Opinion by Justice Cavanagh
Official Michigan Reporter Citation: 425 Mich 300; Link to Opinion 
STATUTORY INDEXING:
Scope of Mandated Coverages [§3131(1)]
TOPICAL INDEXING:
Motor Vehicle Code (Financial Responsibility Act) (MCL 257.501, et seq.)
CASE SUMMARY:
In this Opinion by Justice Cavanagh, the Supreme Court affirmed the decision of the Court of Appeals (Item No. 734) in which the Court of Appeals held that because of the compulsory nature of liability insurance, the non-cooperation of the insured is not a good defense in an action between a third party victim and an insurer to the extent of the statutorily required minimum residual liability insurance.
In this important decision, the court was presented with the question of whether the enactment of the Michigan No-Fault Insurance Act invalidated any provision in a no-fault contract relieving the insurer of liability should the insured fail to cooperate in defending a claim by an injured third party. Plaintiff contended that allowing insurers a defense of non-cooperation leaves the injured third party without the protection mandated by the No-Fault Act. The trial court had found that a snowing by the defendant insurer of due diligence in attempting to secure its insured's cooperation, and a showing of actual prejudice resulting from the insured's non-cooperation was found to constitute a valid defense in a garnishment action on its insurance policy. The Court of Appeals, while not questioning the determination by the trial court that the insured had violated the non-cooperation clause in his contract, nevertheless reversed the trial court and held that the enactment of Michigan's no-fault law in 1972 making liability coverage compulsory, abrogated the provisions of the non-cooperation clause.
The Supreme Court affirmed the decision of the Court of Appeals, holding that the Court of Appeals reached the right result for the right reasons. The decision by Justice Cavanagh was concurred in by Justices Williams, Levin, Brickley, Boyle and Riley. Archer took no part in the decision.
**[Editor's Note: Item No. 1267 included herein, was inadvertently omitted from earlier summaries.]
