STATE MUTUAL INSUR CO V ALLSTATE INSUR CO
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STATE OF MICHIGAN
COURT OF APPEALS
STATE MUTUAL INSURANCE CO., as subrogee
of Earl Marsh and Annette Marsh,
UNPUBLISHED
April 27, 2001
Plaintiff-Appellant/Cross-Appellee,
v
No. 218262
Genesee Circuit Court
LC No. 97-055578-CV
ALLSTATE INSURANCE CO.,
Defendant-Appellee/CrossAppellant.
Before: Griffin, P.J., and Jansen and Gage, JJ.
PER CURIAM.
Plaintiff, State Mutual Insurance Co., appeals as of right an order granting summary
disposition in favor of defendant, Allstate Insurance Co., pursuant to MCR 2.116(C)(10). We
affirm. We dismiss defendant’s cross appeal as moot.
This is a subrogation action for no-fault property protection insurance benefits (PPI),
MCL 500.3121; MSA 24.13121, brought by homeowners insurance company plaintiff State
Mutual Insurance Company, as subrogee of its insureds Earl and Annette Marsh, against no-fault
auto insurance company defendant Allstate Insurance Company.1
On January 29, 1996, a fire originated in the garage of the residence of plaintiff’s
insureds. The facts regarding the fire are not in dispute. At the time of the fire, a 1983 Buick
Skylark owned by Emanuel Marsh (son of Earl and Annette Marsh) and insured by defendant
was in the garage. Earl Marsh was working on the Skylark automobile with his friend, Lance
Body, doing a “valve job.” Because the garage was unheated, Earl Marsh frequently used a
kerosene heater for warmth. On the day of the fire, Earl Marsh placed the kerosene heater
approximately four to six feet away from the vehicle. As the result of an accident, gasoline from
the vehicle spread along the garage floor to the kerosene heater causing a fire. Property damage
to the garage and adjoining residence in the sum of $266,249.18 occurred because of the fire.
1
Defendants Emanuel Marsh and Lance Body were dismissed from this action pursuant to
stipulations of the parties.
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After plaintiff homeowners insurance company paid the property damages to its insureds,
it became subrogated to Earl and Annette Marsh’s claim for property protection insurance
benefits against the insurer of the automobile, defendant Allstate Insurance Company. In the
lower court, defendant moved for summary disposition on two grounds: (1) that it was not liable
for property protection insurance benefits because the accidental property damage did not arise
“out or the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle,”
MCL 500.3121; MSA 24.13121, and (2) plaintiff’s claim was barred by an exclusion in the
policy and no-fault act for property owned “by a person named in a property protection insurance
policy, the person’s spouse or a relative of either domiciled in the same household.” MCL
500.3123(b); MSA 24.13123(b).
In a well-reasoned written opinion, Genesee Circuit Judge Robert M. Ransom granted
defendant’s motion for summary disposition on the basis that the fire was caused by the use of
the portable kerosene heater and that the negligent use of the kerosene heater was unrelated to the
normal maintenance, repair, and use of the motor vehicle as a motor vehicle. The lower court
found that its resolution of the first issue was dispositive and therefore defendant’s second issue
regarding the domicile of Emanuel Marsh was dismissed as moot. Plaintiff appeals the order of
summary disposition granted in favor of defendant. Defendant cross appeals the ruling regarding
the mootness of the policy exclusion issue that would be triggered were Emanuel Marsh a
domicile of his parents’ household.
We hold that the trial court correctly ruled there was an inadequate causal connection
between the maintenance of the automobile and Earl Marsh’s negligent use of the kerosene. The
summary disposition granted in favor of defendant on the basis of lack of causation is affirmed.
For practical purposes, the present case is indistinguishable from Auto-Owners Ins Co v
Citizens Ins Co of America, 189 Mich App 458; 473 NW2d 753 (1991), and Central Mut Ins Co
v Walter, 143 Mich App 332; 372 NW2d 542 (1985). In Auto-Owners, supra at 459, our Court
stated the following:
Daniel Wilke brought his automobile into Coles Garage for maintenance.
While the mechanics were draining the vehicle’s fuel line, gasoline fumes were
ignited by the pilot light of a nearby hot water heater. The fire spread to the
vehicle and eventually destroyed the garage. Coles Garage recovered its damages
from Auto-Owners under a property insurance contract. Auto-Owners then
sought to recover from defendant, who insured Wilke’s vehicle under a policy of
no-fault automobile insurance, on the theory that the fire arose out of the
maintenance of the automobile.
The relevant section of the no-fault act, MCL 500.3121(1); MSA
24.13121(1), provides:
“Under property protection insurance an insurer is liable to pay benefits
for accidental damage to tangible property arising out of the ownership, operation,
maintenance or use of a motor vehicle as a motor vehicle. . . .”
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In a case with remarkably similar facts, where a vehicle’s fuel was ignited
by a hot water heater pilot light, this Court ruled that the accident did not arise out
of the maintenance of the vehicle because there was no connection between the
vehicle’s being maintained and the source of ignition. Central Mutual Ins Co v
Walter, 143 Mich App 332; 372 NW2d 542 (1985).
In the earlier case, Central Mut Ins, supra at 335, our Court applied the causation test set
forth in Kangas v Aetna Casualty & Surety Co, 64 Mich App 1, 17; 235 NW2d 42 (1975). Later
in Century Mut Ins Co v League General Ins Co, 213 Mich App 114, 121; 541 NW2d 272
(1995), this Court applied the Kangas/Thornton v Allstate Ins Co, 425 Mich 643; 391 NW2d 320
(1986), standard to PPI benefits and articulated the following three-part test:
1. The accident must have arisen out of the inherent nature of the
automobile, as such; 2. The accident must have arisen within the natural territorial
limits of an automobile, and the actual use, loading, or unloading must not have
terminated; 3. The automobile must not merely contribute to cause the condition
which produces the injury, but must, itself, produce the injury.
In the present case, the circuit court correctly applied the Kangas/Thornton test by holding
that the automobile was a mere situs of the fire and did not cause the property damage. For this
reason, the lower court properly granted summary disposition in favor of defendant.
In view of our affirmance of the order granting summary disposition, we find it
unnecessary to rule on defendant’s alternative basis for affirmance set forth in its cross appeal.
For this reason, defendant’s cross appeal is dismissed as moot. People v Rutherford, 208 Mich
App 198, 204; 526 NW2d 620 (1994).
Affirmed. Defendant, being the prevailing party, may tax costs pursuant to MCR 7.219.
/s/ Richard Allen Griffin
/s/ Kathleen Jansen
/s/ Hilda R. Gage
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