Michigan Court of Appeals; Docket Nos. 82596, 82719, 83385; Published
Judges Beasley, Holbrook, and Simmons; Unanimous; Per Curiam
Official Michigan Reporter Citation: 151 Mich App 665; Link to Opinion 
STATUTORY INDEXING:
Scope of Mandated Coverages [§3131(1)]
Liability Policy Exclusions for Owned and Non-Owned Vehicles [§3131]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous Opinion by Judge Beasley, the Court of Appeals once again analyzed the validity of nonowned vehicles exclusions in light of the Supreme Court's decision in State Farm v Ruuska (Item No. 487). Judge Beasley wrote that in Ruuska, mere was no majority opinion and, “therefore, it is of diminished precedential value.” Judge Beasley held that there is nothing in the Ruuska opinion which addresses the validity of an exclusion based on the scope of an owner's permission to operate a vehicle, as was the nature of the exclusion involved in the case at bar. Since the lead opinion in Ruuska was limited Jo the specific facts in that case, this panel of the Court of Appeals declined to extend it to a policy exclusion which was based upon the scope of the vehicle owner's consent to drive the vehicle. The court went on today, "In fact, the exclusion of an insured's operation of a nonowned automobile beyond the scope of the owner's permission appears to be consistent with the no-fault act." In support of this conclusion, the court referred to MCLA 3113(a) which precludes availability of PIP benefits where a person takes a vehicle unlawfully.
Judge Beasley went on to state that the mere fact that the exclusion involved in this case was included in the policy definition of a nonowned automobile rather than as part of a separate policy exclusion does not render the exclusion unconscionable or contrary to the reasonable expectations of the insured. Here, the terms of the exclusion are "clear, unambiguous and not in contravention of public policy or the no-fault act...." In light of the fact that the nature of the exclusion raises certain issues of disputed fact, summary judgment was inappropriate. The matter should be remanded to trial so that the jury can determine the facts with regard to the use of the insured vehicle and whether that use was beyond the owner's consent.
