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Citizens Insurance Company of America v Farmers Insurance Group; (COA-UNP, 2/28/1989; RB# 1224)


Michigan Court of Appeals; Docket No. 103539; Unpublished   
Judges Shepherd, Gribbs, and Allen; Unanimous; Per Curiam    
Official Michigan Reporter Citation:  Not Applicable; Link to Opinion alt   

General Rule of Priority [§3114(1)]  
Resident Relatives [§3114(1)]  
Exception to General Priority for Non-Occupants [§3115(1)]

Private Contract (Meaning and Intent)   

In this unanimous per curiam Opinion, the Court of Appeals affirmed judgment in favor of defendant Farmers in a priority dispute involving whether plaintiff was a "relative" of the insured based upon her status as a resident of an adult foster home.

Plaintiff Citizens insured the owner and driver of a car which struck and seriously insured a pedestrian, Dorothy Nelson. Nelson was a mentally ill resident of an adult foster care home owned by Lyle Hotchkiss and his wife. Nelson owned no automobile insurance policy. One of the employees at the adult foster care home, Julie Jackson, was the daughter of its owner. Julie Jackson and her husband, Steve, lived in a separate apartment above the home's garage. The Jacksons had no-fault insurance through Farmers.

Plaintiff Citizens claimed that no-fault benefits were payable by defendant Farmers on the basis that pedestrian Dorothy Nelson was a "ward" of Steve and Julie Jackson, and therefore, Farmers was liable for benefits pursuant to the provisions of §3114(1) providing that a personal protection insurance policy applies to accidental bodily injury to the person named in the policy, the person's spouse and a "relative of either domiciled in the same household."
The insurance policy issued to Steve and Julie Jackson defined a "relative" as including a "ward or foster child."

Plaintiff Citizens relied on the decision in Hartman v INA (Item No. 418) where a mentally incompetent adult living at a private group living facility was determined to be a ward within the meaning of the group homeowner's insurance policy.

In distinguishing Hartman, supra, the Court of Appeals here held that Steve and Julie Jackson, as employees of the adult foster care facility did not own it, nor did Julie Jackson perform the types of services which would make Dorothy Nelson her ward. Julie Jackson's job responsibilities included laundry, cooking, cleaning and general care of the residents. However, she did not give the residents advice or eat meals with them, nor did she maintain the type of "close relationship" with Dorothy Nelson which existed in Hartman, supra. Thus, the court held that Dorothy Nelson was not a ward of the Jacksons within the meaning of §3114(1) and therefore, coverage must be provided by Citizens under the provisions of § 3115.

The court also rejected the argument that Nelson was a "resident of the same household as the named insured." Reviewing the test of residency as set forth in Workman v DAIIE, 404 Mich 477 (1979), the Court of Appeals found that plaintiff failed to establish that the Jackson apartment above the adult foster home's garage made Nelson a resident of the Jackson household. The court also noted that the relationship between the Jacksons and Nelson was "relatively formal" indicating that Nelson was not a resident of the Jackson household.

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