Michigan Supreme Court; Docket Nos. 75437 and 75438; Published
Opinion by Justice William
Official Michigan Reporter Citation: 426 Mich 191; Link to Opinion
Compulsory Insurance Requirements for Owners or Registrants of Motor Vehicles Required to be Registered [§3101(1)]
Obligation of Non-Resident Owner/Registrant to Insure a Vehicle [§3102(1)]
General Rule of Priority [§3114(1)]
Exception for Employer Provided Vehicles [§3114(3)]
Legislative Purpose and Intent
In this decision by Justice Williams, joined by Brickley, Boyle and Riley, the Supreme Court reversed the decision in the Court of Appeals (Item No. 783), in a complicated priority dispute regarding payment of PIP benefits.
The issue in this case was whether the No-Fault Act requires an employee's personal no-fault insurer, the employee's self-insured employer, or the Assigned Claims Facility to provide personal protection insurance benefits when a personally injured employee is injured while occupying an employer owned vehicle that is not required to be-registered in Michigan.
The plaintiff in this case, Wayne Parks, is a Michigan resident, and employee of Roadway Express, a foreign corporation. Parks was injured while working inside a Roadway trailer located at Roadway's Muskegon terminal. The trailer was owned by Roadway, registered in the State of Tennessee, and self-insured. On July 15,1981, Parks filed suit to recover no-fault benefits for his injury, and claimed those benefits against Roadway, his self-insured employer, against DAIIE, his personal automobile insurer, and subsequently, added the Assigned Claims Facility as a defendant.
The trial court dismissed the claim as to Roadway, on the basis that the trailer involved was not required to be registered in Michigan, and therefore could not be made subject to the No-Fault Acf s security requirements. The Court of Appeals reversed the trial court, finding that the Act required Roadway to assume responsibility for Parks' no-fault benefits because Roadway was the self-insured owner of the vehicle furnished to Parks. The Court of Appeals reasoned that the question of whether an owner is required to register a vehicle and subject itself to the mandatory security requirements of §3101 has no bearing on the question of whether the owner could be held liable for benefits under §3105 and §3114.
The Supreme Court noted that §3101(1) requires that "an owner or registrant of a motor vehicle required to be registered in this state shall maintain security for payment of benefits under personal protection insurance ...." Further, §3102(1) provides that "a non-resident owner or registrant of a motor vehicle not registered in this state shall not operate...the vehicle...in this state...more than 30 days in any calendar year unless he or she continuously maintains security for the payment of benefits." However, §3114(1) provides that, "except as provided in subsections 2,3, and 5, a personal protection insurance policy required by §3101(1) applied to accidental bodily injury to the person named in the policy.
The Supreme Court noted that the critical portion of §3114 (1) subsection 3. This subsection provides that an employee "who suffers accidental bodily injury while an occupant of a motor vehicle owned or registered by the employer, shall receive personal protection insurance benefits to which the employee is entitled from the insurer of the furnished vehicle."
The undisputed affidavit of Roadway Express established that the trailer was not required to be registered in Michigan in that it had been operated in Michigan for less than the 30 days which would trigger the requirements of §3102(1).
The Supreme Court held that an out-of-state vehicle not required to be registered in Michigan and not operated in this state for more than 30 days is not subject to the security provisions of §3114(3) of the No-Fault Act, and that when an employee is injured while an occupant of such a vehicle, the employee's personal insurer, if there is one, must pay the employee's personal protection benefits under §3101(1).
The majority rejected the contentions of DAIIE, (Parks' personal no-fault insurer) that a plain reading of the priority provisions of §3114(1)(3) required the conclusion that Parks should look to Roadway as the insurer of the "furnished vehicle."
In reliance upon its decision in Lee v DAIIE (Item No. 489), the Supreme Court noted that the policy of the Legislature was to provide a method whereby persons injured in automobile accidents would be readily provided relief from the results of their injury. The primary method of accomplishing this result, from the general rule in §3114(1), is that one looks to one's own insurer for no-fault benefits unless one of the statutory exceptions applies. In the case of an employee injured in an employer's vehicle, the provisions of §3114(3) apply only in the case in which the insured vehicle is required to be registered in this state. The majority reversed the decision of the Court of Appeals and found that Parks' personal no-fault insurer, DAIIE, must pay his personal protection benefits.
Justice Cavanagh and Archer dissented from this holding, arguing that the unambiguous language of the priority provisions of the No-Fault Act show a legislative intent to hold an employer's insurer primarily liable for personal protection insurance benefits when an employee is injured while occupying a motor vehicle owned or registered by his employer. In a separate dissent, Justice Levin agrees with DAIIE, and Justice Cavanagh that the term "owner or registrant of a motor vehicle" as used in §3114, is not qualified by the concept "required to be registered in this state," and therefore, the plain meaning of §3114 is to place responsibility on the insurer of the furnished vehicle.