828 N.W.2d 441
Mich. Ct. App.2012Background
- Consolidated garnishment appeal arising from writs against Empire Fire and Marine Insurance Company tied to consent judgments arising from a car accident involving Corey Drielick and plaintiffs Hunt, Luczak, and Huber.
- Empire denied coverage under a non-trucking use policy; the named-driver exclusion was found invalid on prior appeal, but the business-use exclusion remained a live issue.
- Parties entered into settlements and an Assignment, Trust and Indemnification Agreement; plaintiffs assigned their claims to enable collection, with Great Lakes and Sargent to pursue garnishments.
- Corey was dispatched to the Great Lakes yard and was miles from the yard at the time of the accident; he was not carrying property at the exact moment of the crash.
- The policy’s business-use exclusion at issue covers bodily injury or property damage while the covered auto is used to carry property in any business; Corey was en route to attach a loaded trailer, implicating the exclusion.
- The trial court had held that neither prong of the business-use exclusion applied; Empire appeals to confirm exclusion applies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the first prong of the business-use exclusion precludes coverage. | Hunt argues exclusion should not apply. | Empire argues exclusion applies because truck was used in the business to carry property. | Yes; first clause applies, precluding coverage. |
Key Cases Cited
- McDonald v Farm Bureau Ins Co, 480 Mich 191 (2008) (contract interpretation guidance; de novo review for contract terms)
- Westfield Ins Co v Ken's Serv, 295 Mich App 610 (2012) (strict construction of exclusions in favor of insured)
- Besic v Citizens Ins Co of the Midwest, 290 Mich App 19 (2010) (exclusions interpreted consistently with policy language)
- Group Ins Co of Mich v Czopek, 440 Mich 590 (1992) (give commonly used meaning to undefined terms; avoid surplusage)
- Carriers Ins Co v Griffie, 357 F. Supp. 441 (1973) (exclusion applies even when no cargo is on board if used to carry property in business)
- Stringfellow, 956 F. Supp. 553 (1997) (federal interpretation of similar phrase)