DYE v ESURANCE PROPERTY & CASUALTY INSURANCE COMPANY
Docket No. 155784
Michigan Supreme Court, Lansing, Michigan
Decided July 11, 2019
Chief Justice: Bridget M. McCormack
Chief Justice Pro Tem: David F. Viviano
Justiсes: Stephen J. Markman, Brian K. Zahra, Richard H. Bernstein, Elizabeth T. Clement, Megan K. Cavanagh
Syllabus
This syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader.
Reporter of Decisions: Kathryn L. Loomis
DYE v ESURANCE PROPERTY & CASUALTY INSURANCE COMPANY
Docket No. 155784. Argued October 9, 2018 (Calendar No. 1). Decided July 11, 2019.
Matthew Dye brought an action in the Washtenaw Circuit Court against Esurance Property and Casualty Insurance Company and GEICO Indemnity Company, seeking personal protection insurance (PIP) benefits under the no-fault act,
unpublished per curiam opinion issued April 4, 2017 (Docket No. 330308), the Court of Appeals, BECKERING, P.J., and BORRELLO, J. (O’CONNELL, J., concurring in part and dissenting in part), held that the trial court had erred by granting summary disposition to Esurance because the parties had not yet reached a meeting of the minds on all the essential terms of the settlement agreement. The majority agreed with Barnes’s interpretation of
In an opinion by Justice ZAHRA, joined by Chief Justice MCCORMACK and Justices MARKMAN, VIVIANO, and BERNSTEIN, the Supreme Court held:
An owner or registrant of a motor vehicle is not required to personally purchase no-fault insurance for his or her vehicle in order to avoid the statutory bar to PIP benefits.
1. Under the no-fault act, an insurer is liable to pay PIP benefits to any Michigan resident for accidental bodily injury arising out of the ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle. These statutory benefits arise regardless of whether an injured person has obtained a no-fault insurance policy. Therefore, determining whether no-fault benefits are available to an injured person does not depend on who purchased, obtained, or otherwise procured no-fault insurance. The only relevant inquiry is whether the injured person can establish an accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle. This relatively low threshold for statutory no-fault coverage was enacted to provide victims of motor vehicle accidents assured, adequate, and prompt reparation for certain economic losses. Given that these benefits would be available to all Michigan residents, the Legislature sought to achieve this purpose by enacting the system of compulsory insurance set forth in
2.
3.
Reversed in part and remanded to the Washtenaw Circuit Court for further proceedings.
Justice CLEMENT, dissenting, would have held that the no-fault act disqualifies an owner from PIP benefits if the owner is injured in his or her own vehicle and no owner has maintained security. While she agreed with the majority that
security to the vehicle by way of the person. Justice CLEMENT stated that the critical nexus among owner, security, and vehicle was of a whole with the rest of the no-fault act, including the priority schemes set out in
Justice CAVANAGH did not participate in the disposition of this case because the Court considered it before she assumed office.
©2019 State of Michigan
MATTHEW DYE, by his Guardian, SIPORIN & ASSOCIATES, INC., Plaintiff-Appellee/Cross-Appellant, v ESURANCE PROPERTY & CASUALTY INSURANCE COMPANY, Defendant/Cross-Plaintiff/Appellant/Cross-Appellee, and GEICO INDEMNITY COMPANY, Defendant/Cross-Defendant/Appellee/Cross-Appellant, and PRIORITY HEALTH, Defendant/Cross-Plaintiff/Appellee, and BLUE CROSS BLUE SHIELD OF MICHIGAN, Defendant-Appellee.
No. 155784
Michigan Supreme Court, Lansing, Michigan
FILED July 11, 2019
OPINION
Chief Justice: Bridget M. McCormack
Chief Justice Pro Tem: David F. Viviano
Justices: Stephen J. Markman, Brian K. Zahra, Richard H. Bernstein, Elizabeth T. Clement, Megan K. Cavanagh
BEFORE THE ENTIRE BENCH (except CAVANAGH, J.)
This case presents the significant question of whether an owner or registrant of a motor vеhicle involved in an accident is excluded from receiving statutory no-fault insurance benefits under the no-fault act,
benefits.’”3 The insured sought leave to appeal in this Court, and we granted the application in part to consider this question.4
We conclude that an owner or registrant of a motor vehicle is not required to personally purchase no-fault insurance for his or her vehicle in order to avoid the
We therefore hold that an owner or registrant of a motor vehicle involved in an accident is not excluded from receiving no-fault benefits when someone other than that owner or registrant purchased no-fault insurance for that vehicle because the owner or registrant of the vehiclе may “maintain” the insurance coverage required under the no-fault act even if he or she did not purchase the insurance. The Court of Appeals’ decision in Barnes and other caselaw suggesting to the contrary are overruled to the extent that they are inconsistent with our holding.6 We reverse in part the judgment of the Court of Appeals and remand this case to the Washtenaw Circuit Court for further proceedings not inconsistent with this opinion.
I. FACTS AND PROCEDURAL HISTORY
On September 26, 2013, plaintiff Matthew Dye was involved in a motor vehicle accident and suffered serious injuries that included a traumatic brain injury. At that time, plaintiff was 32 years old, fully employed, a member of the National Guard who had spent time in Afghanistan, and recently married. At some point before the accident, plaintiff had granted his father power of attorney “to do bussiness [sic] at
After Esurance and GEICO refused to cover plaintiff’s claim, plaintiff filed a breach of contract claim against both insurers along with a declaratory action, alleging that either Esurance or GEICO was obligated to pay his no-fault PIP benefits and requesting that the trial court determine the parties’ respective rights and duties. A priority dispute between Esurance and GEICO ensued.7 Eventually, Esurance paid plaintiff more than $388,000 in
PIP benefits, but Esurance continued to maintain that GEICO was the responsible insurer. GEICO acknowledged that it was the primary insurer and began settlement negotiations with plaintiff and Esurance.
Then, on November 13, 2014, the Court of Appeals’ opinion in Barnes v Farmers Ins Exch was redesignated “for publication.”8 In Barnes, the panel held that “under the plain language of
Esurance filed a cross-claim against GEICO arguing that GEICO had breached a settlement agreement. GEICO moved for summary disposition of plaintiff’s claim, arguing that plaintiff was not entitled to PIP benefits in light of the now-published decision in Barnes because plaintiff owned the subject vehicle but had not insured it and the person who had insured it (plaintiff’s father) was not an “owner” as defined in
fault act because he had the right to use the BMW and because he had physically registered the vehicle.
The trial court granted Esurance summary disposition on its cross-claim, ruling
GEICO filed an interlocutory application for leave to appeal, which the Court of Appeals granted.10 In an unpublished per curiam opinion, the Court of Appeals reversed the trial court’s decision that granted summary disposition to Esurance.11 The panel held that the trial court erred by enforcing the settlement agreement. The panel explained that “[a]lthough the issuance of Barnes promptly snuffed out what appears to have been a ‘nearly done’ deal, the parties had not yet reached a meeting of the minds on all of the
essential terms, and the trial court erred in granting Esurance’s motion for summary disposition on its cross-claim for enforcement of the alleged agreement.”12
In regard to the trial court’s decision denying GEICO summary disposition against plaintiff on the basis of Barnes, the panel embraced Barnes’s interpretation of
Although a motor vehicle may have more than one owner for purposes of the no fault act, it is not sufficient that a vehicle is insurеd by just anyone. At least one owner or registrant must have the insurance required by
MCL 500.3101(1) , and “when none of the owners maintains the requisite coverage, no owner may recover PIP benefits.”[13]
The Court of Appeals then held that the trial court erred as a matter of law by finding that plaintiff’s father was a “registrant” for purposes of
Esurance filed an application in this Court arguing that the Court of Appeals improperly reversed the trial court’s decision to enforce the purported settlement agreement by granting Esurance summary disposition on its cross-claim against GEICO. Plaintiff filed a cross-appeal arguing
II. STANDARD OF REVIEW AND APPLICABLE RULES OF STATUTORY INTERPRETATION
This Court reviews de novo a trial court’s decision on a motion for summary disposition.19 The parties brought their respective summary disposition motions under
MCR 2.116(C)(10), which tests the factual sufficiency of a claim.20 “In reviewing a motion for summary disposition brought under MCR 2.116(C)(10), a trial court considers affidavits, pleadings, depositions, admissions, and documentary evidence filed in the action or submitted by the parties, MCR 2.116(G)(5), in the light most favorable to the party opposing the motion.”21 If, “[e]xcept as to the amount of damages, there is no genuine issue as to any material fact, . . . the moving party is entitled to judgment or partial judgment as a matter of law,”22 and the trial court must grant the motion without delay.23
This Court also reviews de novo questions of statutory interpretation.24 “The role of this Court in interpreting statutory language is to ‘ascertain the legislative intent that may reasonably be inferred from the words in a statute.’ ”25 “The focus of our analysis must be the statute’s express language, which offers the most reliable evidence of the Legislature’s intent.”26 “ ‘[W]here the statutory language is clear and unambiguоus, the statute must be applied as written.’ ”27 “ ‘[A] court may read nothing into an unambiguous
statute that is not within the manifest intent of the Legislature as derived from the words of the statute itself.’ ”28 Neither will this Court “rewrite the plain statutory language and substitute our own policy decisions for those already
III. ANALYSIS
A. LEGAL BACKGROUND
Under the no-fault act, “an insurer is liable to pay [PIP] benefits [to any Michigan resident] for accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle . . . .”30 Although designated as “personal protection insurance” under the no-fault act, PIP benefits are in fact statutory benefits, arising regardless of whether an injured person has obtained a no-fault insurance policy. Indeed, a no-fault insurance carrier can be liable for no-fault benefits even if the motor vehicle it insures was not the actual motor vehicle involved in the accident.31 PIP benefits are paid to injured persons solely by insurers who are authorized to write no-fault insurance policies in this state or who have voluntarily filed a certificate complying with
For these reasons, determining whether no-fault benefits are available to an injured person does not depend on “who” purchased, obtained, or otherwise procured no-fault insurance. The only relevant inquiry is whether the injured person can establish an “accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle . . . .”33 By establishing this relatively low threshold for statutory no-fault coverage, the no-fault act seeks to “provide victims of motor vehicle accidents assured, adequate, and prompt reparation for certain economic losses.”34
And given that these statutory benefits would be available to all Michigan residents, “[t]he Legislature believed this . . . could be most effectively achieved through a system of compulsory insurance, whereby еvery Michigan motorist would be required to purchase no-fault insurance or be unable to operate a motor vehicle legally in this state.”35 Accordingly, the Legislature enacted
maintains that
Against this backdrop, the legal issue before the Court, as aptly stated by amicus Property Casualty Insurers Association of America,
hinges on whether the phrase “the owner or registrant of a motor vehicle required to be registered in this state shall maintain security,” means that the owner (or at least an owner) must be the one to acquire the insurance policy, or whether it suffices for any person to provide the required security such that all that matters is that the vehicle is insured.[36]
GEICO maintains that the former interpretation is correct, and accordingly argues that plaintiff is excluded from receiving PIP benefits because he owned the BMW and was not the one to obtain the no-fault insurance policy. Plaintiff maintains that the latter interpretation is correct, and he argues that he is not excluded from coverage because he owned the BMW and the BMW was insured. While this Court has not yеt addressed this issue, the Court of Appeals has considered very similar arguments in two published opinions, which we now review.
B. COURT OF APPEALS CASELAW
In Iqbal v Bristol West Ins Group,37 the Court of Appeals first addressed in a published decision whether every owner of a vehicle is “required to maintain insurance on the vehicle under the no-fault act . . . .” In that case, the plaintiff did not have title to any vehicle, but he frequently used his brother’s BMW.38 The plaintiff was injured while driving the BMW and requested no-fault benefits. In his answers to interrogatories, the plaintiff indicated that the BMW “ ‘belonged to my brother but I had primary possession.’ ”39 The insurer claimed that the plaintiff should also be considered an owner of the car and that as an owner, the plaintiff must have obtained the insurance policy to obtain PIP benefits. The panel rejected this argument, stating:
Viewing the statutory language in the context of the given facts, the statute would preclude plaintiff from being entitled to PIP benefits if plaintiff “was the owner . . . of [the BMW] . . . involved in the accident with resрect to which the security required by section 3101 . . . was not in effect.” As part of the process of construing
MCL 500.3113(b) , we shall make the assumption that plaintiff was an “owner” of the BMW, as that term is defined inMCL 500.3101(2)(g)(i) . Next, the phrase “with respect to which the security required by section 3101 . . . was not in effect,” § 3113(b), when read in proper grammatical context, defines or modifies the preceding reference to the motor vehicle involved in the accident, here the BMW, and not the person standing in the shoes of an owner or registrant. The statutory language links the required security or insurance solely to the vehicle. Thus, the question becomes whether the BMW, and not plaintiff,had the coverage or security required by MCL 500.3101 . As indicated above, the coverage mandated byMCL 500.3101(1) consists of “personal protection insurance, property protection insurance, and residual liability insurance.” While
plaintiff did not obtain this coverage, there is no dispute that the BMW had the coverage, and that is the only requirement under
MCL 500.3113(b) , making it irrelevant whether it was plaintiff’s brother who procured the vehicle’s coverage or plaintiff. Stated differently, the security required byMCL 500.3101(1) was in effect for purposes ofMCL 500.3113(b) as it related to the BMW.[40]
In sum, Iqbal held that the only requirement under
policy because the policy only covered the named insured, Huling, and was never intended to benefit plaintiff.”47
In Barnes, after hearing arguments, “the trial court ruled that the no-fault act required at least one of the ‘owners’ to have insurance. It reasoned that because neither plaintiff nor [her mother] had insurance, plaintiff was barred from seeking benefits under the no-fault act.”48 The trial court granted summary disposition to the insurer.49
The plaintiff in Barnes appealed, arguing that Iqbal required the opposite result. The Court of Appeals stated:
In the present case, plaintiff cites Iqbal and argues that the fact that neither she nor [her mother] insured the Cavalier does not matter because Huling did. Plaintiff contends that this is so regardless of whether Huling was an owner of the Cavalier. Iqbal should not be read so broadly as to apply to even nonowners. The Court made it clear that it was addressing the problem of whether the statute required “each and every owner” to maintain insurance on a vehicle. The Court opined that to so hold would preclude an owner who obtained insurance from receiving PIP benefits as long as any other co-owner did not maintain coverage as well.[50]
Thus, Barnes distinguished Iqbal, stating that “while Iqbal held that each and
isolаtion, and as a result announces a rule that undermines the act. For these reasons, and as explained below, I dissent.
Defendant argues that it is not liable for plaintiff’s PIP3 claim because plaintiff’s circumstances meet the statutory disqualification provision in
The person [seeking benefits] was the owner or registrant of a motor vehicle . . . involved in the accident with respect to which the security required by section 3101 . . . was not in effect.
All agree that
(1) The 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, property protection insurance, and residual liability insurance. . . .
* * *
(3) Security required by subsection (1) may be provided under a policy issued by an authorized insurer that affords insurance for the payment of benefits described in subsection (1). . . .
Subsection (1) requires a vehicle’s owner to “maintain security for payment of benefits under personal protection insurance, property protection insurance, and residual liability insurance.” There are two pieces here: first, the owner must “maintain security”; second, that security must ensure payment of benefits under PIP insurance (which pays for bodily injury) and property-protection insurance (which pays for property damage).4 As Subsection (3) explains, security “may be provided under a policy issued by an authorized insurer that affords insurance for the payment of benefits described in subsection (1)”—put more simply, to maintain security under § 3101 is to have a no-fault policy with PIP and property-protection insurance.
According to the majority, as long as the vehicle is insured,
insurance. See
The majority doesn’t rely on the statute’s phrase “with respect to”; indeed, it appears to toss out that language in favor of its own formulation, stating that insurance is “on the vehicle” or “for the vehicle.”7 That formulation lets the majority assume, contrary to the Legislature’s text, that the statute connects only the security
exists security “with respect to” a vehicle not when that vehicle is insured but rather when that vehicle’s owner “maintains security.”9
This critical nexus among owner, security, and vehicle is of a whole with the rest of the no-fault act. While the majority hasn’t grappled with this contextual consideration, my reading is consistent with, and therefore supported by, the act’s other sections, like the priority schemes set out in
(a) The insurer of the owner or registrant of the vehicle occupied.
(b) The insurer of the operator of the vehicle occupied.
Similarly, under § 3115(1) an injured nonoccupant (e.g., a pedestrian) must claim in this order:
(a) Insurers of owners or registrants of motor vehicles involved in the accident.
(b) Insurers of operators of motor vehicles involved in the accident.
At the outset, note that these provisions refer as the object of no-fault coverage to persons (owners, registrants, operators), not to vehicles.11 More crucially, the priority scheme reflects the prenominate nexus among owner, security, and vehicle.
That nexus is reflected too by the act’s design and purpose, which falls apart if an
In other words, the no-fault scheme aims to assure (insofar as possible) a liable insurer for every victim. To meet that goal, the Legislature required two things: (1) that every owner (or registrant) “mаintain security,”
To illustrate, let’s say plaintiff had hit a pedestrian not covered by a personal or household policy. The priority scheme,
plan.14 The pedestrian’s PIP benefits then would be funded through increased rates for all policyholders, as though the pedestrian were a hit-and-run victim.15 This is how the majority
Much puzzles me about the majority’s interpretive approach. It makes some obvious lapses in its understanding of the no-fault act’s text—I again point out the majority’s insistence that the no-fault act concerns insurance “on” (or “for”) a vehicle, despite the act’s exclusion of damaged vehicles. And its interpretation of “maintain” in
indirectly) when “he instructed his father to obtain no-fault insurance.”16 Ante at 18. The majority suggests that plaintiff’s instruction to his father met the duty to maintain security in the same way that a son’s duty to maintain his lawn could be met by the son’s instructing his father to mow the lawn.17 But the son’s duty in those circumstances would nоt be met if the father mowed only the father’s own lawn. Likewise here, the son’s statutory duty to “maintain security” is not met by asking his father to get no-fault insurance if his father insures only himself. For this reason, it is to me neither here nor there that plaintiff’s father took out a no-fault policy in response to plaintiff’s instruction because that policy named the father, not plaintiff.18
The majority’s approach to statutory interpretation also gives short shrift to context and purpose. As I read the no-fault act, §§ 3101 and 3113 dovetail with other parts of the act, like the priority scheme; and my reading advances the act’s purposes, which we recognized in Shavers. The majority’s reading, on the other hand, barely acknowledges that we’re interpreting a small part of a larger system, let alone contemplates how its reading affects that larger system and undermines its purposes. The majority’s approach suggests (albeit implicitly) that neither context nor purpose plays a role in statutory interpretation. Yet the light thrown by context and purpose can cast the text in sharper
relief. Indeed, had the majority paused for a moment to consider the act’s goals, it might have recognized that some of the premises underlying its decision are mistaken.
As explained above, I read the no-fault act as disqualifying an owner from PIP benefits if the owner is injured in his or her own vehicle and no owner (or co-owner)
Elizabeth T. Clement
CAVANAGH, J., did not participate in the disposition of this case because the Court considered it before she assumed office.