Michigan Court of Appeals; Docket No. 73598; Published
Judges Hood, Kelly, and Livo; Unanimous
Official Michigan Reporter Citation: 139 Mich App 633; 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 Kelly, the Court of Appeals held that the amount of third-party tort damages recoverable under a "stacked policy" is the policy limits ($50,000/$ 100,000), rather man the statutorily required minimum limits ($20,000/$40,000), where an exclusionary clause in the policy (in this case a nonowned vehicle exclusion) is unenforceable because of ambiguity rather than because it is prohibited by statute.
In DAIIE v Widling (Item No. 500), the Court of Appeals considered an exclusionary clause identical to the nonowned automobile clause involved in this case and held that it was unenforceable under the rationale of State Farm v Ruuska (Item No. 217). Therefore, plaintiff may collect under both policies covering the driver in this case.
The previous decision in State Farm v Shelly, 394 Mich 448 (1975) is inapplicable to this case. That decision held that where an exclusionary clause in an insurance policy is void because it violates the Motor Vehicle Accident Claims Act, the reinstated coverage is limited to the minimum required by law rather than the greater policy limits. Because the exclusionary clause in this case was not violative of the statute, but rather unenforceable for other reasons, the policy will be enforced as written, thereby obligating the insurance to pay its full policy limits.
