Michigan Court of Appeals; Docket #268649; Unpublished
Judges Neff, Bandstra, and Zahra; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
Not applicable
TOPICAL INDEXING:
Private Contract (Meaning and Intent)
Underinsured Motorist Benefits: Notice and Statute of Limitations for Underinsured Motorist Coverage
CASE SUMMARY:
In this unanimous unpublished per curiam opinion decided without oral argument, the Court of Appeals affirmed summary disposition for defendant, finding that plaintiff’s breach of contract action for underinsured motorist benefits was barred because it was not brought within the one-year time limit provided by the insurance contract. The plaintiff in this case was injured in an accident while driving his father’s motor vehicle. His father had a no-fault insurance policy through defendant which included optional underinsured coverage. The underinsured policy provision provided that any action for benefits must be brought within one year. The accident occurred on November 12, 2002. In June 2002, plaintiff notified defendant it intended to file a claim for underinsured motorist benefits and submitted a letter from the other driver’s insurer stating it would pay policy limits. Defendant requested additional information which it received on December 12, 2002. Thereafter, defendant informed plaintiff’s attorney the other driver appeared uncollectible, and, if the one-year time period had not expired, it would have waived its subrogation rights and allowed plaintiffs to settle. However, since the one-year period had expired, it denied plaintiff’s claim.
On appeal, plaintiff argued the contract should not be enforced because it is ambiguous. In support of his claim, plaintiff stated the one-year time limit is so short it is nearly impossible to comply with. The court rejected this argument, reasoning that plaintiff did not argue the policy was ambiguous, but that it was unreasonable. Under Rory v Continental Insurance Company [RB #2576], the Michigan Supreme Court held that a judicial assessment of reasonableness is an invalid basis for refusing to enforce an unambiguous contractual limitations policy; only traditional contract defenses can avoid enforcement of the contract provision. In this regard, the court stated:
“In Rory, our Supreme Court . . . concluded that a judicial assessment of reasonableness is an invalid basis for refusing to enforce an unambiguous contractual limitations period. . . . Such a provision is to be enforced unless it violates the law or public policy. . . . Only traditional contract defenses, including duress, waiver, estoppel, fraud, or unconscionability, may be used to avoid enforcement of the provision.”
