Ingham County Circuit Court; File No. 88-61975-CK
Judge Lawrence M. Glazer;_____
Official Reporter Citation: _______ ; Link to Opinion 
STATUTORY INDEXING:
Scope of Mandated Coverages [§3131(1)]
Liability Policy Exclusions for Owned and Non-Owned Vehicles [§3131]
Liability Exclusions Prohibiting Stacking of Coverages [§3131]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
This case, decided by the Ingham County Circuit Court, involved a stacking issue. The court granted summary disposition in favor of the claimant and found a no-fault policy's "anti-pyramid" clause was ambiguously worded and deceptively placed, thereby rendering it invalid to deny coverage. Equally important, the court also found the policy's "owned vehicle" clause defective because it employed terms with commonly understood meanings but the insurer attempted to give these terms a special meaning in a different portion of the policy.
The insured was a 15-year old driver of an automobile who struck and killed a motorcyclist. The insurer who issued a policy of insurance on the automobile involved in the accident, paid the limits of its liability coverage. At the time of the accident, the driver was living with his mother who owned another vehicle insured under a second policy of insurance. The estate of the motorcyclist submitted a claim for coverage to be stacked under this policy with that provided under the first policy. The insurer of the second vehicle claimed that the stacked coverage should be denied under its policy's "anti-pyramid" clause and "owned vehicle" clause.
The court noted that the insurer contended that the "anti-pyramid" clause operated as an exclusion. However, the clause was found in the "conditions" portion of the policy and not within the exclusions section, and, therefore, the court, relying on Yahr v Garcia (Item No. 1275), found the clause to be defectively placed. Secondly, the court found the term of art "pyramiding" to be undefined and therefore ambiguous. For these reasons, the court found the "anti-pyramid" clause did not operate to exclude coverage.
The insurer argued that its policy's "owned vehicle" clause excluded coverage where the car involved in the accident was insured under another policy of insurance. The court, again relying on Yahr, found the clause to be defectively placed, in that it operated as an exclusion, but was not found in an exclusions section of the policy. Further, the court employed the analysis set forth by the Michigan Supreme Court in Powers v DAIIE (Item No. 979) to find the clause inapplicable to deny coverage here. The "owned vehicle" clause employed terms with commonly understood meanings which would appear to give rise to coverage, and yet the policy attempted to narrowly define these words to limit coverage in another section of the policy. Pursuant to Powers and Yahr, the court found this approach defective and, therefore, did not operate to exclude coverage.
This case is currently on appeal to the Michigan Court of Appeals.
