Timothy Matouk v. Michigan Municipal League Liability & Prop Pool, 332482

Background

Plaintiff Timothy Matouk, a Harper Woods police officer, was added as an individual defendant in a federal civil-rights suit arising from his cousin JoAnn Romain’s disappearance and death; the federal complaint alleges threats, presence near the scene, false tips, and participation in a cover-up.
Michigan Municipal League Liability & Property Pool (MML) insures the City of Harper Woods under a municipal liability policy that covers insureds for wrongful acts only if those acts arise out of discharge of public duties and are within the scope of employment.
MML provided defense coverage for the Grosse Pointe municipalities and their officers but refused to defend Matouk under the Harper Woods policy, asserting the alleged misconduct was outside his scope of employment.
Matouk sued in Macomb Circuit Court seeking a declaratory judgment compelling MML to defend him; the trial court granted partial summary disposition in Matouk’s favor, holding MML had a contractual duty to defend.
The Court of Appeals reversed, holding the alleged acts were not arguably within the scope of Matouk’s Harper Woods employment and therefore MML had no duty to defend under the Policy.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether MML has a duty to defend Matouk under the Harper Woods policy because alleged acts "arise out of discharge of public duties" and are within the scope of employment	Matouk: allegations are plausibly within scope because any involvement required official authority and he was on duty	MML: Policy limits coverage to acts within scope of employment for Harper Woods; allegations concern activity outside jurisdiction and employment duties	Held: No duty to defend — allegations, read as a whole, concern acts outside scope of Harper Woods employment and thus are not arguably covered
Whether being "on duty" is sufficient to trigger coverage	Matouk: he was on duty when Romain disappeared, so coverage applies	MML: "On duty" alone is not dispositive; scope requires acts to be of kind employed to perform and actuated to serve employer	Held: Being on duty is insufficient; plaintiff’s alleged acts were unrelated to Harper Woods duties
Whether MML is estopped because it defended other officers under different municipal policies	Matouk: MML defended other officers under identical claims, so estoppel/equitable collateral principles apply	MML: Coverage must be determined by the specific policy and insured (Harper Woods); defenses under other municipal policies are irrelevant	Held: No estoppel; separate policies and insureds control coverage analysis
Whether federal court statements that claims are plausibly alleged bind coverage decision	Matouk: federal court’s plausible-allegation finding supports duty to defend	MML: trial record contains no binding federal findings; legal conclusion in complaint is not controlling for coverage	Held: Federal court’s posture/finding not binding; labels/legal conclusions do not create coverage when facts show acts outside scope

Key Cases Cited

Loweke v. Ann Arbor Ceiling & Partition Co., 489 Mich. 157 (2011) (standard of review for MCR 2.116(C)(10))
Auto Club Group Ins. Co. v. Burchell, 249 Mich. App. 468 (2001) (insurer duty to defend extends to allegations that even arguably fall within coverage)
Detroit Edison Co. v. Mich. Mut. Ins. Co., 102 Mich. App. 136 (1980) (insurer must defend if any theory of recovery falls within policy)
Hamed v. Wayne County, 490 Mich. 1 (2011) (definition of "within the scope of employment")
Rogers v. J.B. Hunt Transport, Inc., 466 Mich. 645 (2002) (limits of vicarious liability; deliberate misconduct outside scope)
Zsigo v. Hurley Medical Center, 475 Mich. 215 (2006) (use of Restatement factors to analyze scope of employment)
Auto-Owners Ins. Co. v. Churchman, 440 Mich. 560 (1992) (effect of clear exclusions and insurer not liable for risks not assumed)
Frankenmuth Mut. Ins. Co. v. Masters, 460 Mich. 105 (1999) (unambiguous policy language enforced as written)