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Citizens Insurance Co of America v ACIA; (COA-UNP, 4/12/1989; RB #1254)


Michigan Court of Appeals; Docket No. 101950; Unpublished    
Judges Cynar, Shepherd, and Kelly; Unanimous; Per Curiam  
Official Michigan Reporter Citation:  Not Applicable; Link to Opinion alt    

General Rule of Priority [§3114(1)]  
Exception for Employer Provided Vehicles [§3114(3)]

Not Applicable    

In this unanimous per curiam Opinion, the Court of Appeals reversed and remanded for further proceedings a case in which the priority dispute depended upon whether or not the injured party was an employee of the owner of the vehicle involved in the accident.

Robert Bailey was insured by plaintiff Citizens. He was injured while an occupant of a vehicle owned and operated by William Simmons, who was insured by defendant Automobile Club.

Citizens paid personal protection benefits to Bailey as a result of an automobile accident in which Bailey was an occupant of a vehicle owned and operated by Simmons. Citizens claimed that Bailey was employed by Simmons, and therefore, under the provisions of §3114(3), Automobile Club was obligated to pay Bailey's no-fault benefits. Automobile Club claimed that Bailey was an "independent contractor," and therefore, not an employee. The trial court found that Mr. Bailey was an independent contractor, and entered summary disposition in favor of defendant.

On appeal, the Court of Appeals held that the economic reality test as established by Parham v Preferred Risk, 124 Mich App 618 (1983) determined whether or not a person was an employee for purposes of the No-Fault Act In this case, the record revealed numerous facts which might support a finding that Mr. Bailey was an employee of Mr. Simmons. The Court of Appeals found that questions of fact remained with regard to the employment relationship, and that summary disposition should not have been granted to either plaintiff or defendant. Accordingly, the trial court's granting of summary disposition was reversed and the case was remanded for further proceedings.

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