Esurance Prop & Casualty Ins Co v. Michigan Assigned Claims Plan, 968 N.W.2d 482

Background

Edwards crashed a vehicle registered to Anthony; Edwards had no no-fault coverage and did not live with a covered resident relative.
A Colorado policy issued by Esurance to Anthony’s mother, Luana, (on representations she owned and garaged the car in Colorado) initially led Esurance to pay Edwards PIP benefits.
Edwards applied to the Michigan Assigned Claims Plan (MACP); MAIPF did not assign a servicing insurer because Esurance was already paying benefits.
Esurance later obtained a default judgment rescinding the policy as void ab initio for fraud and then sued MACP/MAIPF seeking reimbursement via equitable subrogation for PIP benefits it had paid.
Trial court dismissed under expressio unius; Court of Appeals affirmed on the alternative grounds that (a) if the policy existed Esurance was the applicable insurer so Edwards had no MACP claim, or (b) if the policy never existed Esurance was a volunteer.
Michigan Supreme Court reversed: an insurer with at least an arguable duty to pay can seek equitable subrogation; “applicable” policy requires an order-of-priority analysis; Esurance was not a volunteer on the pleaded facts and remand was required to address who may be sued under MCL 500.3174.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Availability of equitable subrogation where a paying insurer is not in statutory priority	Esurance: may stand in Edwards’s shoes and subrogate against MACP because Edwards timely applied and had no applicable policy	MACP: no statutory basis; no-fault act’s reimbursement provisions exclude equitable subrogation	Court: Equitable subrogation available where insurer has at least an arguable duty to pay and the subrogee acquires no greater rights than the subrogor
Does existence (or rescission) of the insurer’s policy bar subrogation because Edwards had no MACP claim?	Esurance: “applicable” policy requires order-of-priority analysis; mere existence of a policy is insufficient	MACP: Esurance’s policy existed when payments were made, so Edwards could not claim through MACP	Court: Must perform MCL 500.3114 order-of-priority analysis; on the pleaded facts Esurance was not in priority so Edwards could have claimed through MACP
Does rescission of the policy convert Esurance into a "mere volunteer" and bar subrogation?	Esurance: paid under an erroneous impression of facts and duty (induced by fraud), so not a volunteer	MACP: rescission makes policy as if never existed; payments were made without obligation, so Esurance was a volunteer	Court: Payment made under an arguable duty to protect insurer’s interests is not voluntary; Esurance was not a mere volunteer on the pleaded facts
Is expressio unius est exclusio alterius a bar to equitable subrogation here?	Esurance: no; statutory reimbursement provisions do not implicitly exclude equitable remedies	MACP: Legislature listed reimbursement mechanisms, so others are excluded	Court: Trial court misapplied the canon; reimbursement provisions do not implicitly foreclose equitable subrogation

Key Cases Cited

DAIIE v Detroit Mut Auto Ins Co, 337 Mich 50 (1953) (defines "volunteer" for equitable subrogation)
Auto-Owners Ins Co v Amoco Prod Co, 468 Mich 53 (2003) (subrogee acquires no greater rights than subrogor)
Atlanta Int'l Ins Co v Bell, 438 Mich 512 (1991) (equitable subrogation described as a legal fiction permitting one party to stand in another’s shoes)
Bazzi v Sentinel Ins Co, 502 Mich 390 (2018) (rescission voids contract ab initio and restores parties to pre-contract positions)
Maryland Cas Co v Transamerica Ins Corp of America, 199 Mich App 561 (1993) (insurer with an arguable duty to pay is not a volunteer)
Auto Club Ins Ass'n v New York Life Ins Co, 440 Mich 126 (1992) (unreasonable delay in paying benefits not excused by priority dispute)
Hartford Accident & Indem Co v Used Car Factory, Inc, 461 Mich 210 (1999) (equitable subrogation is flexible and analyzed case-by-case)