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Geico Indemnity Company v Goldstein and Leon v Farmers Insurance Exchange (COA-UNP, 1/19/2010, RB #3111)


Michigan Court of Appeals; Docket #288418; Unpublished
Judges Wilder, O’Connell, and Talbot; unanimous; per curiam
Official Michigan Reporter Citation:  Not applicable, Link to Opinion courthouse graphic


Compulsory insurance requirements for owners or registrants of motor vehicles required to be registered [3101(1)]
Definition of owner [3101(2)(h)]
Disqualification for uninsured owners or registrants of involved motor vehicles or motorcycles [3113(b)]
Obligations of admitted insurers to pay PIP benefits on behalf of nonresidents injured in Michigan [3163(1)]
Persons disqualified from receiving benefits through the assigned claims facility [3173(1)]

Not Applicable

In this unanimous unpublished per curiam opinion, the Court of Appeals held that where a vehicle, owned by an out-of-state resident, was involved in an accident in Michigan, where Michigan residents were injured, the vehicle’s insurer, which was certified to sell insurance in Michigan, is the first in priority under MCL 500.3163.  It also determined that where one of the persons injured in the accident may have been a constructive owner of the vehicle under MCL 500.3101, because she may have had use of the vehicle for more than 30 days, then that person would not be entitled to benefits under MCL 500.3113 because she had not obtained no-fault insurance for the vehicle.

When the accident occurred, Belinda Goldstein and her boyfriend, Daniel Leon, were living in Michigan.  Neither Goldstein nor Leon owned a car.  Goldstein, who had multiple sclerosis (MS), traveled to her mother’s home in New Mexico in order to drive her mother’s Plymouth Acclaim back to Michigan so her mother would have a car to drive when she came to visit.  Goldstein registered the vehicle at her apartment on November 29, 2005.  Goldstein’s mother insured the vehicle under a policy she purchased from Geico in New Mexico.  Although Goldstein occasionally used the vehicle, both she and her mother stated that Goldstein would ask for permission.  

On December 24, 2005, Goldstein and Leon were injured in a motor vehicle accident involving the Acclaim.  Geico denied their claim for no-fault benefits and filed this action, arguing that Goldstein was not listed as the driver on the policy, Geico had not been made aware of the transfer of possession of the vehicle, and Goldstein, as an uninsured owner of the vehicle under MCL 500.3101(2)(g), was not entitled to no-fault benefits under MCL 500.3113(b).

Meanwhile, the Michigan Assigned Claims Facility assigned the claim to Farmers, which also denied the claim.  Goldstein filed a counter-complaint against Geico and a complaint against Farmers.  Farmers moved for summary disposition, arguing that Goldstein was not entitled to benefits under MCL 500.3113(b) and MCL 500.3173, because she was a statutory owner of the vehicle and because she failed to obtain her own no-fault insurance policy.  Goldstein filed a counter-motion, arguing there was no evidence she was a constructive owner of the vehicle and, therefore, Farmers was required to pay her PIP benefits.  Geico then moved for summary disposition, arguing that it had no obligation to provide PIP benefits under MCL 500.3163 because application of that statute is limited to claims brought by out-of-state residents who are injured in accidents arising out of the operation or use of a motor vehicle in Michigan.  

The trial court found that Goldstein and Leon were not entitled to benefits from Geico.  However, it found that Goldstein was not an owner of the vehicle and, therefore, she and Leon were not barred from recovering benefits from Farmers, the Assigned Claims insurer.  Farmers appealed.

In reversing, the Court of Appeals first noted that insurance coverage in this case was dependent upon the interpretation of MCL 500.3163(1), which provides:

“An insurer authorized to transact automobile liability insurance and personal and property protection insurance in this state shall file and maintain a written certification that any accidental bodily injury or property damage occurring in this state arising from the ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle by an out-of-state resident who is insured under its automobile liability insurance policies, is subject to the personal and property protection insurance system under this act.”

The court then noted that because the phrase “ownership, operation, maintenance, or use” that appears in MCL 500.3163(1) is written in the disjunctive, any of the four conditions can modify the phrase “out-of-state resident.”  Therefore, the court found, based on the holdings in Tevis v Amex Assurance Co, 283 Mich App 76; 770 NW2d 16 (2009), and Transport Insurance Co v Home Insurance Company, 134 Mich App 645; 352 NW2d 701 (1984), because the accident involved a vehicle owned by an out-of-state resident, Geico, an authorized and certified no-fault insurer in Michigan, was required to provide no-fault benefits even though the accident involved Michigan residents.  In this regard, the court stated:

“The Tevis Court’s interpretation of MCL 500.3163(1) is applicable to this case.  The parties do not appear to dispute that even though the policy in question was issued for a New Mexico vehicle, Geico is certified to provide insurance in Michigan, and an automobile liability policy exists between the nonresident, Horwitz, and the certified carrier, Geico.  However, as the Tevis Court explains, the test for determining an insurer’s liability under MCL 500.3163 that is set forth in Transport Ins Co presumes that the liability at issue in MCL 500.3163 only concerns injuries incurred by an out-of-state resident, and does not take into account an insured’s liability under the circumstances presented in this case, namely, when a Michigan resident is injured in an accident in which a nonresident insured owns the motor vehicle in question.  However, Tevis also indicates that a plain-language reading of MCL 500.3163 indicates that an insurer who is subject to the Michigan personal and property insurance system is liable for any accidental bodily injury that occurs in Michigan and arises from an insured out-of-state resident’s ownership of a motor vehicle, even if the injury occurs to an individual who is a Michigan resident but not insured.  Accordingly, because Geico is subject to the Michigan personal and property insurance system, the Acclaim was insured under a Geico policy, and the owner of the Acclaim was an out-of-state resident, MCL 500.3163 requires Geico to provide no-fault benefits in this case.”

The court next addressed Farmers’ argument that Goldstein was a constructive owner of the vehicle and, therefore, was not entitled to no-fault benefits under MCL 500.3173, because she was required to obtain no-fault insurance for the vehicle.  The court determined that under MCL 500.3101, if it can be established that Goldstein had use of the motor vehicle for more than 30 days, then she was a constructive owner of the vehicle and, under MCL 500.3113, was only entitled to no-fault benefits if she obtained no-fault insurance for the vehicle.  However, the court found there was a question of fact regarding whether Goldstein was permitted to use the vehicle for more than 30 days or was merely storing the vehicle for her mother and, therefore, it reversed and remanded for further proceedings.  In this regard, the court stated:

“Accordingly, the circumstances surrounding Goldstein’s acquisition of the Acclaim might lead a fact-finder to conclude that the parties contemplated for Goldstein to have use of the Acclaim for an indefinite period that would extend beyond 30 days.  In fact, we suspect that a conclusion regarding whether Goldstein was a constructive owner of the Acclaim would depend primarily on a fact-finder’s determination of the credibility of Horwitz, Goldstein, and Leon and the believability of the reasons that they gave for storing the Acclaim in Michigan, especially in light of circumstances that could also indicate that Horwitz was effectively providing Goldstein with access to a car when she needed one.  Accordingly, we reverse the trial court’s motion granting summary disposition to Goldstein on this issue and remand this case for factfinding regarding whether Goldstein had a right to use the vehicle that made her a constructive ‘owner’ for no-fault purposes.”

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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