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Long v Pioneer State Mutual Ins Co. and Lowry; (COA-UNP, 11/30/2010; RB #3276)


Michigan Court of Appeals; Docket No. 293556; Unpublished
Judges Cavanagh, Hoekstra, and Gleicher Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable, Link to Opinionalt

Serious Impairment of Body Function Definition (McCormick Era: 2010 – present) [§3135(7)]
Serious Impairment of Body Function Definition (Kreiner Era: 1996-2010) [§3135(7)]
General Ability / Normal Life Element of Serious Impairment (McCormick Era: 2010 – present) [§3135(7)]
General Ability / Normal Life Element of Serious Impairment (Kreiner Era: 1996-2010) [§3135(7)]
Determining Serious Impairment of Body Function As a Matter of Law (McCormick Era: 2010 – present) [§3135(2)]
Determining Serious Impairment of Body Function As a Matter of Law (Kreiner Era:1996-2010) [§3135(2)]

Interpretation of Insurance Contracts   
Underinsured Motorist Coverage: Coverage in General 
Underinsured Motorist Coverage: Setoffs Applicable to Underinsured Motorist Cases

In this unpublished unanimous per curiam Opinion regarding plaintiffs' underinsured claims and threshold claims for economic loss, the Court of Appeals affirmed the trial court’s denial of defendant’s motion for summary disposition as to plaintiffs' UM and threshold claims, because the trial court “correctly declined to accept Pioneer’s proffered UM liability limitation position,”  and because plaintiff “met the serious impairment threshold as a matter of law” under the McCormick v Carrier standard.

Plaintiff Joanne Long was a passenger in a pick-up truck driven by plaintiff Patrick Maloney, which collided with Defendant William Lowry’s vehicle after Defendant Lowry pulled out in front of them on the highway.  During the accident, Plaintiff Maloney sustained serious injuries, which the Court described as a “C6-7 central disc protrusion causing moderate narrowing of the spinal canal …and disc protrusions at T7 and T8 without high grade compromise of the spinal canal.”  Plaintiff Maloney was insured by Defendant Pioneer under a no-fault policy that provided underinsured coverage of “$100,000 per person and $300,000 per occurrence.”  

Following the accident, plaintiffs filed separate suits against both Defendant Lowry and Defendant Pioneer seeking to recover non-economic damages and underinsured motorist (UM) benefits from Defendant Pioneer.  The two suits were later consolidated.  Defendants Pioneer and Lowry later moved for summary disposition contending that Plaintiff Maloney did not suffer a threshold injury.  However, the trial court denied defendants’ motions and found that Plaintiff Maloney suffered a threshold injury as a matter of law under the Kreiner standard, which was controlling at that time.  Defendant Pioneer further moved for summary disposition a second time contending that it “bore no responsibility to pay any UM benefits to Maloney and Long as a matter of law,” which motion the trial court also denied.  With Poineer’s approval, plaintiffs eventually settled with Defendant Lowry for his policy limits of $100,000, and it was agreed that  

This appeal then followed, wherein Defendant Pioneer challenges the trial court’s denial of summary disposition as to both plaintiffs’ UM claims and as to Plaintiff Maloney’s threshold claims. On appeal, the Court of Appeals affirmed as to both the UM and the threshold claims. 

Plaintiffs’ UM Claims

In reviewing the trial court’s denial of summary disposition with respect to Plaintiffs’ UM claims, the Court of Appeals noted that “[w]hen reviewing an insurance coverage dispute, well established principles of contract construction guide this Court’s interpretation of policy terms,” which require that “an insurance contract must be enforced in accordance with its terms . . ., a court should not create ambiguity in an insurance policy where the terms of the contract are clear and precise . . , [and] the terms of a contract must be enforced as written where there is no ambiguity.”

The Court noted that in seeking to deny plaintiffs UM benefits, Pioneer advanced two arguments.  Pioneer first argued that “Lowry’s vehicle does not qualify as ‘underinsured’ according to the language of Maloney’s policy, which states that “defines an ‘underinsured motor vehicle’ as a vehicle to which a bodily injury liability … policy applies at the time of the accident but its limit for bodily injury liability is less than the limit of liability for this coverage. . .  According to Pioneer, Lowry’s no-fault policy’s accidental bodily injury liability single limit of $100,000 is not less than Maloney’s accidental bodily injury liability policy limits of $100,000 per person and $300,000 per occurrence. Pioneer theorize[d] that the policies are ‘equal’ because both provide $100,000 coverage per person.” However, the Court rejected this argument, reasoning that:

"Pioneer’s argument ignores the $300,000 per occurrence limit of Maloney’s accidental bodily injury liability policy. As Pioneer acknowledges, Long qualified as an insured under Maloney’s policy, and “could potentially receive coverage.” Consequently, Maloney’s policy afforded Maloney and Long each $100,000 in UM coverage for their bodily injuries, totaling $200,000, while Lowry’s policy allowed them to jointly recover no more than $100,000. Because Maloney’s coverage plainly exceeded that available under Lowry’s policy, the circuit court correctly denied Pioneer’s motion for summary disposition on this ground."

Pioneer then argued that its policy language was analogous to the policy language at issue in Wilkie v Auto-Owners, 469 Mich 41 (2003), which the Supreme Court interpreted to limit the UM coverage under the policy there based on the coverage available to the owner or operator of the underinsured vehicle, and Wilkie should therefore require that the Pioneer policy language here be interpreted to similarly limit the plaintiffs’ UM benefits --- which then results in plaintiffs being entitled to no UM benefits once the $100,000 in settlement proceeds is considered.  The Court of Appeals rejected this argument, finding Wilkie to be distinguishable.  In this regard, the Court explained:

"Here, Pioneer’s policy describes a two-step process for ascertaining the limit of available UM coverage. First, ¶ A of the limitation of liability portion of the Pioneer policy’s UM endorsement establishes the frame of reference for calculating UM benefits. Paragraph A specifically identifies as the relevant guidepost for further calculations the policy limit available “for each person” making a UM claim: “Subject to this limit for each person, the limit of liability shown in the Schedule or in the Declarations for each accident for Underinsured Motorists Coverage is our maximum limit of liability for all damages for ‘bodily injury’ resulting from any one accident.” (Emphasis added). Next, ¶ B of the UM endorsement limitation instructs that the “limit of liability shall be reduced by all sums paid” by the legally responsible person. This language notably differs from that of the Auto-Owners policy interpreted in Wilkie, which contained no specific reference to per person coverage limits, but instead reduced the insurer’s UM liability according to the total limit of coverage “available” to the owner of the underinsured vehicle. Accordingly, the Supreme Court’s analysis of the contested policy language in Wilkie does not direct the outcome of this case."

Accordingly, after rejecting the foregoing arguments, the Court concluded that the trial court “correctly declined to accept Pioneer’s proffered UM liability limitation position and appropriately denied Pioneer’s motion for summary disposition.” 

Plaintiff Maloney’s Threshold Claims

In reviewing Plaintiff Maloney’s threshold claims, the Court of Appeals noted that the trial court applied the Kreiner v Fischer standard in finding that plaintiff met the serious impairment threshold as a matter of law, which standard the Supreme Court has since overruled in McCormick v Carrier and set forth a new standard for deciding threshold claims.  Therefore, the Court of Appeals reviewed Plaintiff Maloney’s threshold claims under the new McCormick standard. 

In doing so, the Court noted that no factual dispute existed as to Plaintiff Maloney’s injuries, which under McCormick requires that, “the threshold question [of] whether a person has suffered a serious impairment of a body function should be determined by the court as a matter of law.”  The Court explained that to meet the threshold,  “[a] plaintiff must show “(1) an objectively manifested impairment (2) of an important body function that (3) affects the person’s general ability to lead his or her normal life.” 

The Court then noted that Pioneer did not challenge Plaintiff Maloney’s contention that he suffered objectively manifested injuries that impaired a body function and instead “focused its argument on the third prong, whether Maloney’s injuries have affected his general ability to lead his normal life.” In this regard, Pioneer argued that:

"Maloney has not established that his injuries affect his general ability to lead his normal life because (1) when the accident occurred, Maloney was unemployed and received disability benefits for a closed head injury, (2) Maloney remains able to perform routine housework and can ride his lawnmower “to cut his two acres of lawn” while seated on an extra cushion, and (3) no physician has placed any restrictions on Maloney’s activities. However, Pioneer does acknowledge that Maloney testified at his deposition that he can no longer dance, “do sports,” or ride his snowmobile, motorcycle, or dirt bikes. Maloney also expressed an inability to split the wood he used to heat his house and perform renovation work on his 100- year-old farm."

However, the Court rejected Pioneer’s arguments and concluded that Plaintiff Maloney “has met the serious impairment threshold as a matter of law.”  In reaching this conclusion, the Court first clarified that when evaluating whether a plaintiff’s injuries have affected his ability to lead his normal life, under the new McCormick standard, “courts should consider not only whether the impairment has led the person to completely cease a pre-incident activity or lifestyle element, but also whether, although a person is able to lead his or her pre-incident normal life, the person’s general ability to do so was nonetheless affected.”  The Court then found with regard to Plaintiff Maloney that:

Maloney has shown that his neck and back impairments have affected his general ability to lead his normal life because he now lacks the capacity to perform some activities of normal living, including renovating the buildings on his property. And Maloney no longer participates in the recreational activities he previously enjoyed on a regular basis. Because the injuries have affected some of Maloney’s capacity to live in his pre-accident manner, the circuit court properly found that Maloney satisfied the serious impairment threshold in MCL 500.3135(1) and (7), and properly denied Pioneer’s motion for summary disposition on this ground.”

Accordingly, based on the foregoing, the Court of Appeals affirmed the trial court’s denial of Pioneer’s motion for summary disposition with respect to Plaintiff Maloney’s threshold claims.

Michigan auto accident attorney Stephen Sinas is the lead editor of the appellate case summaries published on this site regarding the Michigan auto insurance law. To learn more about how Stephen Sinas and how the Sinas Dramis Law Firm can help you if you have been injured in a Michigan auto accident, visit

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