*1 TRAVELERS INDEMNITY COMPANY WERNER v THE of Scope Appeal and Error — 1. Arbitration and Award — Review. Appellate judgments confirming vacating courts accord or arbitra- scope review; tion awards a limited and award will not be excessive, merely unjust, inadequate, held invalid it because is contrary or to law. Appeal and Error —Court Rules. 2. Arbitration and Award — power an arbitration award is limited court A court’s tо vacate (GCR 1963, 769.9[1]). rule Appeal and 3. Arbitration and Award — Error —Court Rules. appeal The manner in which an from an arbitration award shall specified by court rule and a defendant is be taken is not properly appellate pursue court before an where he failed to (GCR 769.9). rights according his to the terms of the rule Insurance—Primary 4. Insurance —Excess Automobiles — Insur- Apportiоnment. ance — policy An insurance issued to the owner of a vehicle involved in primary policy, an accident with an uninsured vehicle is the company policy passen- and the which issued that is liable to a ger policy in the insured vehicle to the limits of the without apportionment despite presence pro of a rata clause in the policy, party by аnd a issued to another another com- pany providing coverage, uninsured motorist which covers the injured passenger, secondary policy is a under which that responsible only will be for the amount of which exceed the insurer’s limits. [1-3] [4] [5] Apportionment 5 Am Jur 7 Am Jur 44 Am Jur where one of the the other a 4 Am Jur 2d, 2d, 2d, 2d, Appeal References Arbitration and Award 145. "proportionate” Automobile Insurance 1417. policies and Error for Points § Insurance § between automobile has an "excess insurance” clause and "prorata” §§ § in Headnotes 156-158. 202. clause. 76 ALR2d liability insurers Ind Co Werner Opinion of the Coukt by Elliott, J.
Concurrence Damages—Payment Appeal Pending Error — Insurance — 5.. Appeal. *2 dispute Appeal in a between should not be allowed two insurance coverage acknowledge companies where both about to plaintiff plaintiff paid been unless has below, by subject tribunal to determined one insurer’s other, recovery appeal. if successful on from Wise, M. J. Appeal Wayne, from John Submitted (Docket at June Detroit. Division No. 17015.) September Decided 1974. Werner,
Complaint by Richard administrator Werner, deceased, the estаte of Ellen Mary against The Indemnity Company Travelers and The Amer- Fellowship ican Mutual Company Insurance for payment of an arbitration award. Summary judg- ment plaintiff. for The Fellowship American Mu- tual Affirmed. Company appeals. Insurance
Dice, Sullivan, Sweeney & P. G (by Altero J. Alteri), plaintiff. for
Vandeveer, Garzia, Tonkin, Kerr & Heaphy, Sullivan), P. C. (by James A. for defendant The Travelers Indemnity Company.
Willans, Frisbee & Ryal (by Zolkower), Daniel for defendant The American Fellowship Mutual Insurance Company. Gillis, J., J.
Before: H. P. and Allen and Ell iott,* JJ.
Allen, J. Defendant American Fellowship Mu- tual Insurance Company appealed has from the March 1973 order plaintiff’s granting motion * judge, sitting Appeals by assignment. Circuit on the App Opinion of the Court 117.2(3). GCR The summary judgment. Indemnity Company ordered trial court and ordered defendant to to pay to $652 $10,000 plaintiff, contrary defendant’s pay $10,652 award should the total pоsition between the two equally prorated have been insur- companies. ance
This out of automobile accident case arises An December which occurred on automo- by Thomas C. operated bile owned and Hendren driven an unin- collided with an automobile decedent, Mary motorist. Plaintiff’s Alice sured Werner, passenger was a vehicle and Hendr^n’s killed a result of the accident. The as Hendren Fellowship vehicle was insured Mu- Company, policy provided tual Insurance coverage pursuant uninsured motorist to MCLA *3 500.3010; 24.13010. Plaintiff was MSA insured by Company, plaintiff’s Travelers and Indemnity dece- party dent was an insured under the uninsured coverage provided motorist in policy. Each $10,000 limit, policy had a liability statutorily required minimum amount coverage. оf MCLA 500.3010; 257.504; MSA 24.13010 and MCLA MSA 9.2204. dispute upon
This is based meaning and given effect to applicable portions be to the of the "other insurance” clauses contained in both insur- policies. ance American Fellowship’s clause states: "Other insurance. respect
"With to bodily injury to an insured while occupying through being by struck an uninsured automobile, if such insured is a named insured under other similar insurance available to him then the dam- ages shall be higher deemed not to exceed the of the applicable of liability limits of this insurance and such Ind Co Werner of Couet insurance, shall not and be liable other under this greater proportion policy applica- of the for a this than limit liability limit of such bears ble to applicable liability the sum of the limits of of this other insurance.” insurance and such portion The relevant of the Travelers’ is as follows: respect bodily injury
"Other insurance. With occupying insured while an automobile by not owned insured, named the insurance under Part III shall apply only as any excess insurance over other similar applicable insurance available to such insured and insurance, such automobile as ance shall limit and this insur- apply only then the amount which the applicable liability coverage for this exceeds the limit of of such other insurance.” Both policies provisions contained to submit dis- puted arbitration, claims to pursuant and thereto filed a demand for arbitration with the American Arbitration against Association both insurance companies. In the course of the arbitra- tiоn proceedings, the arbitrator expressed his de- sire to have the circuit court respec- determine the tive liability of each company. insurance On Au- gust 20, 1971, the trial court determined that $10,000 first any award should paid American Fellowship, and that Travelers would be liable for the excess. August 30, 1971,
On
the arbitrator
awarded
plaintiff $10,000 from American Fellowship,
from
$652.08
Travelers. Although the triаl court
*4
apparently entered a judgment affirming the arbi-
tration award on
29, 1971,
October
filed
the instant
action
1972,
in October of
and on
March
1973, the trial court granted plaintiff’s
motion for summary judgment
and confirmed the
117.2(3)
arbitration award. GCR
and 769.11.
App
Mich
has noted that
there is a
Our Court
"limited
appellate courts
scope of review which
accord judg-
confirming
vacating
or
arbitration
ments
awards”.
Corp
Burroughs
Detroit
Corp,
Demolition
(1973).
Am p Jur Arbitration and § 769.9(l)(a-d) In Michigan, GCR limits a power court’s to vacate an arbitration award. Such an award may only be vacated where: "(a) The procured by fraud, award was corruption, or means; other undue (b) There was partiality evident by an arbitrator appointed corruption as a neutral or in any of the arbitrators or party; prejudicing rights misconduct of any (c) The powers; arbitrators exceeded their or (d) The postpone arbitrators refused to hearing upon being sufficient cause shown therefor or refused to hear evidence material controversy the as to or otherwise so hearing conducted the prejudice substantially rights of a party. But the fact that the relief was such that it could not or granted would not ground a court of equity law or is not vacating refusing to confirm the award.” 1963, 769.9(2) GCR provides aggrieved party may apply to vacate the arbitration award within 20 days after delivery of a copy of the *5 Ind Co 395 Werner Opinion the of applicant days or within 20 after the to the award alleged "corruption, or other fraud unduе means” have been or should known are known applicant. rights pursuant its to enforce Defendant failed Although appar- rule. defendant to above court ently quash to filed motion October judgment court, of circuit that motion came days rendering than 60 after the more of the Also, defendant arbitration award. failed assert pur- should be arbitration award vacated grounds forth suant set above. Michigan Honigman Hawkins, & Court Rules (2d ed), p reviewing "[t]he
Annotated noted court is those restrictions of rule bound authority which limit the of the circuit courts”. 1963, 769.15, The above was a comment to GCR provides "[a]ppeals which in shall be taken the manner and to the same extent as from orders judgments in civil actions”. doWe not read this expansion as of limited nature a court’s of authority to order the vacation of an arbitration light appellate award. In of an court’s limited hand, function in a case such as the at one conjunction pursue with defendant’s failure to rights according 1963, 769.9, to the terms of GCR argument properly we find that defendant’s is not before our Court. argument properly
If defendant’s us, were before ruling we would find trial court correct in Fellowship, American insurer of the Hendren vehi- responsible, primarily up cle, statutorily was to its $10,000 mandated limit, 500.3010; MCLA MSA 257.504; 9.2204, 24.13010 and MCLA MSA providing coverage plain- Travelers, and that tiffs for responsible decedent, the amount plaintiffs damages $10,000 which exceeded the App 390 the Court the most frequently occur- is one limit. At issue insurance, namely, ring conflicts in automobile "pro rata” clause in given to be effеct policy and the "excess in- Fellowship’s *6 28 policy. in Traveler’s ALR3d clause the surance” situation, 551, 6, it is p generally 566. In such § to the owner issued of the policy held that the (Hendren) particular in the involved acci- vehicle "primary” policy, and the at hand is dent (American policy that which issued Fel- company limits of the policy without lowship) is liable presence "prо of a apportionment, despite policy. in that 28 ALR3d rata” clause contained Thus, providing fn 12. p policy § (Travelers) "nonownership coverage” is the second- company responsible and that will be ary policy, amount of which exceed the only for the 2d, 7 Am policy limits. Jur insurer’s Insurance, 542-543. pp Automobile See also § (2d Couch, Ed), 62.72, p 16 519. In Insurance § finding apportionment that there should be no plaintiffs damages, the trial court followed the in majority expressed rule as the above authorities 502, 2, p in 76 ALR2d § Bureau, upon Blakeslee v Farm Relying 464; (1972), NW2d 786 defendant has argued that the "other insurance” con- clauses policies tained in the two at are contrary hand to 500.3010; legislative of MCLA MSA 24.13010, and that each should bear an equal plaintiffs share of ar- damages. Defendant gues "pro that rata” with Trav- clause conflicts elers’ in "excess” clause and that such a situation apportioned equitable should be an as problem. solution to the as This has be'en noted 512; minority §3, rule in 76 p ALR2d 2d, Insurance, Am 544- §202, p Jur Automobile Ind Co Werner v ^ op the Court (2d Couch, Ed), §62.74, Insurance 545; p and 16 "Lamb-Weston” as the is also known 520. This Lamb-Weston Inc rule, upon the decisiоn based Co, Oregon Auto Ins 110; 110; 341 P2d 219 Or (1959). effect, argues In defendant ALR2d 485 Blakeslee, supra, necessarily in ruling forces "Lamb-Weston” Michigan adopt minority rule. decision, Blakeslee, supra,
In the
of its
course
Virginia
jurisdictions
was one
noted
"other
clause
which the
insurance”
of an automo-
Virginia’s
bile
was found to
contrary
statute. Bryant v State Farm
uninsured motorist
Co,
Mutual Auto Ins
205 Va
Many that a contention rejected have rule of* two or more benefits insurance "stack” may Relying upon claim. damage satisfy to policies Signal v Ins Thurman rule, "Lamb-Weston” 1002, 1004-1006 P2d 524, 528; 491 Co, 260 Or was limited (1971), plaintiff-passenger held that $10,000, each and recovery a total $5,000. result A similar pay company was Paulson, 162; 18 Utah 2d v in Russell reached & Fire (1972), Protective 661-662 417 P2d Woten, 186 212, 217; 181 NW2d vCo Neb Casualty v Preferred McCarthy (1970), 836-838 (CA Co, 454 F2d 395-396 Mutual Ins Risk law). decisions, 1972) Those Arizona (interpreting to Horr v identical stacking, were allowing not Exchange, 379 Mich 562; Auto Inter-Ins Detroit (1967). Blakeslee distinguished 153 NW2d previous it arose Horr on the grounds 500.3010; MSA 24.13010. of MCLA requirements 464, 469-470. 388 Mich "pyramid” may one stack
Blakeslee held that 388 Mich has been satisfied. until his loss recovery and Boettner upon Blakeslee Relying Ins, 482; 201 NW2d Mutual 388 Mich State Farm Mutual Ins recent case of Citizens (1972), Turner, 220 NW2d Co v 53 Mich coverage (1974), the uninsured motorist held that of which both poliсies, insurance found two limit, $10,000 could be stacked contained satisfy that she could benefit so injured party’s $15,500. Turner involved two policies her award *8 the consequently company, the same by- issued how much upon to decide court was not called company. paid each award was to be the total favoring the However, Michigan’s policy in view of benefits, disallow- find those cases stacking of we ing stacking unpersuasive. Co Ind Werner v Opinion of the Court supra,
Lamb-Weston, Inc, felt that it was absurd company should be held to determine which to be secondary primary rejected insurer, and reasoning” what it to be "circular considered so. 219 128; which did decisions Or upon general "equi- Thus, based P2d 118-119. principles” the court determined that table each рroportionate company should bear a share of the 110, 129; loss. 219 341 P2d 119. A Or similar Exchange conclusion was held Truck Ins v Rptr Torres, 483, 488; Cal 2d 14 Cal (1961). Many company cases have noted that the which insured the owner of the vehicle involved in the primary accident should insurer. Certified — Indemnity Thompson, —; Co v Colo 505 P2d (1973). Eggleston 962, 963 Townsend, See also v (D 1972) (constru- Supp 1212, 336 F ing Md, 1218-1219 law), Virginia and Curran v State Auto Mu- Co, tual 33, 39; Ins 2d Ohio St 266 NE2d (1971), pursuant held, 568-569 which to Ohio’s practically statute, uninsured motorist which is Michigan’s, identical which insured the insurer, host-driver plaintiff-passenger’s and that insurance com- responsible pany was for the excess amount of loss. recognizing many While courts often find company insuring that the cle involved is the owner of the vehi-
primarily responsible, Continental Group National Burleson, 283 Ala (1969), 671, 220 So 2d 614-615 referred to previous decision which had indicated that theory comprising basic majority of the cases rule: "is simply virtue of the 'excess insurance’
clause there is no other 'valid and collectible’ insurance *9 App 55 op the Court phrase as used in 'pro meaning within rata’ clause.” case, phrase "other similar
In the instant him” is used rather than insurance available in insurаnce American Fel- collectible” "valid and clause, meaning but is the lowship’s pro rata theory problem, to our the above Applying same. court was correct in its find that the trial we Fellowship would be determination until limits were- primarily responsible exhausted, Travelers would be liable for and that the excess. limiting recovery one’s to a total of
While Paulson, $10,000, 157, 161; 18 Utah 2d Russell v (1966), referred to an Iowa 417 P2d deci- sion, Exchange, Burcham v Farmers Ins 255 Iowa (1963), 500, 502 73; 121 which discussed NW2d excess is gener- rule that clause majority given pro effect and the with the ally is the rata clause in its insurer. Burcham stated: holding always may, "The basis for so is not clear. It
however, justified on what is a rational basis of the industry in intent of the insurance clauses its uses of such up payment to set order of limit amounts 69, 73; payable prevent recovery.” double 255 Iowa 500, 502, reprinted 121 NW2d at 18 Utah 2d P2d Russell, Burcham, supra, and supra, were both i.e., concerned with avoiding recovery,” "double they group come within that adhere of cases which "anti-stacking” doctrine. "anti- While their stacking” inapplicable discussion is in jurisdic- a tion committed to the contrary, we feel that payment” "ordеr of rationale furnishes the Court with another reason for affirming the trial court’s Ind Co v Travelers Werner by Elliott, J. Concurrence supra, Lamb-Weston, Inc,
decision. As noted majority cases which underlie rule often "primary-secondary” result reached the clearly stating without finding. a reason for such We find payment” theory support adds "order *10 insurer, that the Hendren conclusion Amer- Fellоwship, "pro ican whose contained the primarily responsible, clause, rata” is while the only pay plain- insufer, Travelers, "excess” had to Fellowship paid $10,000. tiff after American had appellees. Affirmed, costs J., J. H. P. Gillis, concurred. (concurring). join J. I concur and
Elliott, Judge opinion. My remarks are on a Allen’s subject argued. not was briefed or appeal only dispute
This involves a between two companies disagree insurance who about whether coverage "pro-rata”. one is "excess” or The dispute delayed by a arbitrator, determination finally August plaintiff 30, 1971, made on damage $10,652.08 sustained on December daughter by 1966, when his killed an unin- Fellowship appeals sured motorist. American from a circuit court decision and confirmation of the requiring pay plus award, limits, it to interest, instead of the one-half that it has claimed it owes. dispute Travelers does not it owes $652.08 plus legal "excess” interest at the rate.
Although Fellowship acknowledges $5,325.04, and Travelers admits that it plaintiff $652.08, owes has not received even these eight nearly years amounts daughter after the death of his fully years delayed liqui- three after dation of legal award, his claim. Interest on the át the percent per annum,
rate of six will abe Elliott, J. Concurrence plaintiff interest would pay fraction of actual money. on borrowed in a not be allowed case like this
Appeal should paid has been unless below, subject to appel- the tribunal determined the other insurer if lant’s from successful recovery apрeal. on
An occurs when a analogous situation disabled to be entitled to compen- workman is determined dispute a exists as to which of sation but his obliged carriers is employer’s compensation to pay it. opposite
These situations are of "inter- 1963, 210. I pleader” provided by hope GCR our Supreme adopt just Court will rule that would govern this nature. cases of