MARK TODD TWICHEL V MIC GENERAL INSUR CORP
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Michigan Supreme Court
Lansing, Michigan 48909
Chief Justice
Maura D. Corrigan
Opinion
Justices
Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman
FILED MARCH 9, 2004
MARK TODD TWICHEL, Personal
Representative of the Estate
of BRADY S. SIES, Deceased,
Plaintiff-Appellee,
v
No. 121822
MIC GENERAL INSURANCE
CORPORATION,
Defendant-Appellant.
________________________________
PER CURIAM
This
case
involves
whether
defendant
insurer,
MIC
General Insurance Corporation, is liable for either (1) nofault personal protection insurance benefits or (2) policyprovided uninsured motorist benefits as the result of a
fatal accident. The issue is whether the deceased was the
"owner" of the vehicle under either MCL 500.3113(b) or the
language of the policy.
The Court of Appeals held that the
deceased
owner,
was
not
therefore payable.
the
We reverse.
1
and
that
benefits
were
I
At the time of the fatal accident on November 17,
1998, decedent Brady S. Sies was driving a 1988 GMC pickup
truck.
Five days earlier, he had purchased the truck from
a friend, Matthew Roach.
The sale price was set at $600.
Sies gave Roach $300 and was to pay the remainder at a
later date.
title
was
payment.
Sies took possession of the vehicle, but the
not
signed
There
was
over
no
because
insurance
of
the
policy
incomplete
listing
the
vehicle.
At the time of the accident, Brady Sies was living
with his grandfather, Elmer Sies, who had a policy issued
by
the
defendant
covering
his
vehicles.1
The
personal
representative of Brady Sies=s estate brought this action
against the defendant, claiming both personal protection
insurance benefits and uninsured motorist coverage.
The
circuit court held that the deceased was covered by the
policy both for personal protection insurance and uninsured
motorist
benefits.
The
Court
of
Appeals
affirmed
in
a
published opinion.2
1
As a relative residing in the same household, Brady
could potentially obtain benefits under Elmer=s policy.
MCL 500.3114(1).
2
251 Mich App 476; 650 NW2d 428 (2002).
2
II. Personal Protection Insurance Benefits
A.
Statutory Language
MCL 500.3113(b) precludes owners of uninsured vehicles
from receiving personal protection insurance benefits:
A person is not entitled to be paid personal
protection insurance benefits for accidental
bodily injury if at the time of the accident any
of the following circumstances existed:
* * *
(b) The person was the owner or registrant
of a motor vehicle . . . involved in the accident
with respect to which the security required by
section 3101 or 3103 was not in effect.
The key question presented is whether Brady Sies was
the
"owner"
of
the
truck.
That
term
is
defined
in
MCL 500.3101(2)(g) as follows:
(i) A person renting a motor vehicle or
having the use thereof, under a lease or
otherwise, for a period that is greater than 30
days.
(ii) A person who holds legal title to a
vehicle, other than a person engaged in the
business of leasing motor vehicles who is the
lessor of a motor vehicle pursuant to a lease
providing for the use of the motor vehicle by the
lessee for a period that is greater than 30 days.
(iii) A person who has the immediate right
of possession of a motor vehicle under an
installment sale contract. [Emphasis added.]
B.
This
case
involves
MCL 500.3101(2)(g)(i).
are
questions
Standard of Review
of
law
the
proper
interpretation
of
Issues of statutory interpretation
that
we
3
review
de
novo.
Oade
v
Jackson Nat=l Life Ins Co, 465 Mich 244, 250; 632 NW2d 126
(2001); Donajkowski v Alpena Power Co, 460 Mich 243, 248;
596 NW2d 574 (1999).
In analyzing questions of statutory
construction, our obligation is to determine the intent of
the
Legislature
statute.
as
expressed
in
the
language
of
the
Wickens v Oakwood Healthcare Sys, 465 Mich 53,
60; 631 NW2d 686 (2001); Farrington v Total Petroleum, Inc,
442 Mich 201, 212; 501 NW2d 76 (1993).
C.
Court of Appeals Decision
The Court of Appeals read Ardt v Titan Ins Co,
233
Mich
App
Zielinski,
685;
244
593
NW2d
215
(1999),
Mich
App
677;
624
NW2d
and
539
Chop
(2001),
v
as
indicating that under subsection i, the person in question
must actually have had use of the vehicle for thirty days
or more.
The Court declined to follow Ringewold v Bos, 200
Mich App 131; 503 NW2d 716 (1993). Ringewold involved MCL
257.401,
the
Vehicle Code.
owner's
liability
section
the
Michigan
That statute has a definition of “owner”
that is similar to MCL 500.3101(2)(g)(i).3
3
of
The defendant in
MCL 257.37 defines Aowner@ as:
(a)
Any
person,
firm,
association,
or
corporation renting a motor vehicle or having the
exclusive
use
thereof,
under
a
lease
or
otherwise, for a period that is greater than
30 days.
4
Ringewold claimed that she was not the owner of the vehicle
because
she
possession
did
of
accident.4
it
not
for
hold
more
legal
than
title
thirty
and
did
days
not
before
have
the
The Ringewold Court held that MCL 257.401 did
not require actual use of the vehicle for more than thirty
days and that the defendant was the owner of the vehicle
under these circumstances.
The panel in this case refused to follow Ringewold,
not because of any material differences in the language of
the two statutes, but because of the differing purposes of
the Michigan Vehicle Code and the no-fault insurance act.
It said that the former is intended to place liability on
the person who has ultimate control of the vehicle.
By
contrast, the goal of the no-fault insurance system is to
assure
that
persons
injured
in
motor-vehicle
accidents
receive prompt and adequate reparation for injuries.
The
panel thus concluded that it was reasonable to construe the
(b)
Except
as
otherwise
provided
in
section 401a, a person who holds the legal title
of a vehicle.
(c) A person who has the immediate right of
possession of a vehicle under an installment sale
contract. [Emphasis added.]
4
The plaintiff in Ringewold was injured when struck by
a vehicle that had been purchased by the defendant's former
husband for their daughter fifteen days before the
accident.
He had paid the entire purchase price, but did
not make arrangements to record the transfer of title.
5
similar
language
in
a
different
manner
because
of
the
different statutory purposes.
The panel also noted the factual differences between
the two cases.
In Ringewold, the full purchase price had
been paid and, although the title had not been transferred,
the defendant had insured the vehicle and put on license
plates from a previously owned vehicle.
In the present
case, the full price had not been paid, the title had not
been delivered because the sale was not complete, and the
seller's plates were retained.
Thus, the panel concluded
that this was not a case, like Ringewold, "where ownership
had been transferred permanently."
D.
200 Mich App 138.
Analysis
We agree with the reasoning in the Ringewold decision,
which
construed
257.37.
As
the
the
virtually
Ringewold
identical
Court
language
explained,
it
of
MCL
is
not
necessary that a person actually have used the vehicle for
a thirty-day period before a finding may be made that the
person is the owner.
Rather, the focus must be on the
nature of the person's right to use the vehicle.
Once again, MCL 500.3101(2)(g)(i) defines “owner” as
“[a]
person
renting
a
motor
vehicle
or
having
the
use
thereof . . . for a period that is greater than 30 days.”
(Emphasis
added.)
Reading
this
language
in
the
manner
suggested by plaintiff requires substitution of the phrase
6
“having used the vehicle” for the phrase “having the use
thereof.”
Nothing in the plain language of MCL 500.3101(2)(g)(i)
requires (1) that a person has at any time actually used
the vehicle, or (2) that the person has commenced using the
vehicle at least thirty days before the accident occurred.
The statute merely contemplates a situation in which the
person is renting or using a vehicle for a period that is
greater than thirty days.
Accordingly, if the lease or other arrangement under
which the person has use of the vehicle is such that the
right of use will extend beyond thirty days, that person is
the
"owner"
from
the
inception
of
the
arrangement,
regardless of whether a thirty-day period has expired.
For
example, in the case of a lease running longer than thirty
days, the plain language of the statute would make that
person an "owner" from the inception of the lease; the
person's
status
would
not
change
simply
because
of
the
passage of time.
In this case, the arrangement between the seller and
the deceased was for a permanent transfer of ownership of
the vehicle and it contemplated that the deceased would
have exclusive use of the truck permanently.
The fact that
the accident occurred before the expiration of thirty days
7
does not affect the nature of the deceased's interest in
the vehicle.
The
Court
of
Appeals
declined
to
follow
Ringewold
because that case involved the Michigan Vehicle Code rather
than the no-fault statute.
differing
purposes
of
The Court reasoned that the
those
statutes
permit
different meaning to the identical language.
that view.
free
We reject
The focus of statutory interpretation must be
on the language used by the Legislature.
not
giving
to
accommodate
legislation.
manipulate
their
own
interpretations
views
of
the
The courts are
of
statutes
to
purpose
of
overall
See Hanson v Mecosta Co Rd Comm=rs, 465 Mich
492, 504; 638 NW2d 396 (2002).
Like the Michigan Vehicle Code, MCL 500.3101(2)(g)(i)
treats a person as an "owner" of a vehicle if the person
rents or has the use of the vehicle for a period greater
than thirty days.
It is the nature of the right to use the
vehicleCwhether it is contemplated that the right to use
the vehicle will remain in effect for more than thirty
daysCthat is controlling, not the actual length of time
that has elapsed.
In this case, the Court of Appeals noted that there
were differences between the transactions in Ringewold and
the
present
case.
However,
those
details,
regarding
whether the full purchase price had been paid, etc., are
8
inconsequential. Despite those differences, the key fact
remains the same.
The arrangement under which Brady Sies
obtained the vehicle contemplated that he would have the
use of it for more than thirty days, thus bringing him
within
the
statutory
definition
of
"owner"
under
§ 3101(2)(g)(i).5
5
The
Court
of
Appeals
additionally
rejected
defendant’s alternative argument that the decedent was “[a]
person who has the immediate right of possession of a motor
vehicle under an installment sale contract” and thus
qualified as an “owner” under MCL 500.3101(2)(g)(iii). In
light of our conclusion that the decedent was the owner of
the truck under § 3101(2)(g)(i), it is not necessary to
address this issue at length. However, we wish to note our
disagreement with the Court of Appeals’ analysis.
The panel looked to the Motor Vehicle Sales Finance
Act (MVSFA), MCL 492.101 et seq., and adopted its
definition of “installment sale contract” (“a contract for
the retail sale of a motor vehicle . . . under which part
or all of the price is payable in 2 or more scheduled
payments . . . ”). See MCL 492.102(9).
Accordingly,
because the transaction between the decedent and Roach was
not a retail sale or a commercial transaction and because
there was no payment schedule, the panel concluded that §
3101(2)(g)(iii) was inapplicable.
We conclude that in addition to qualifying as an
“owner” under § 3101(2)(g)(i), the decedent qualified as an
“owner” under § 3101(2)(g)(iii). The MVSFA is inapposite,
as it applies only to sellers who are “engaged in the
business of selling, offering for sale, hiring, or leasing
motor vehicles under installment sale contracts or a legal
successor in interest to that person,” not including
isolated sales. MCL 492.102(4). Thus, the panel erred in
importing into the no-fault act the MVSFA’s definition of
“installment sale contract.”
The commonly understood meaning of the undefined
phrase “installment sale contract” in § 3101(2)(g)(iii)
would include the arrangement between the decedent and
Roach.
The phrase “installment sale contract” does not
9
III.
The
benefits
second
under
Uninsured Motorist Benefits
issue
is
whether
defendant's
policy
uninsured
are
motorist
available.
The
interpretation of an insurance contract is a question of
law that we review de novo.
Henderson v State Farm Fire &
Cas Co, 460 Mich 348, 353; 596 NW2d 190 (1999).
Uninsured
motorist benefit clauses are construed without reference to
the no-fault act because such insurance is not required
under the act.
Rohlman v Hawkeye-Security Ins Co, 442 Mich
520, 525; 502 NW2d 310 (1993).
The
policy
excludes
coverage
for
injury
sustained
while the insured is occupying an uninsured motor vehicle
that is "owned" by the insured:
require a writing; nor does it require a sale at retail.
Merriam Webster’s Collegiate Dictionary (10th ed) provides
a typical definition of the term “installment”: “One of the
parts into which a debt is divided when payment is made at
intervals.”
Moreover, Black’s Law Dictionary (7th ed)
defines the more specific term “installment contract” as
“[a] contract requiring or authorizing the delivery of
goods in separate lots, or payments in separate increments,
to be separately accepted.”
Thus, there is no material
difference whether the term is accorded its commonly
understood meaning or is considered to be a term of art.
The decedent had a contract for the purchase of the truck.
The
purchase
price
was
payable
in
at
least
two
installments.
The decedent had the immediate right of
possession of the truck pursuant to the sale contract.
Under these circumstances, he qualified as one having the
“immediate right of possession of a motor vehicle under an
installment sale contract” and was thus an “owner” under §
3101(2)(g)(iii).
10
A. We do not provide Uninsured
Coverage for "bodily injury" sustained:
Motorists
1. By an "insured" while occupying, or when
struck by, any motor vehicle that is owned by
that "insured" which is not insured for this
coverage under this policy.
Brady Sies was an "insured" because he was residing
with
his
grandfather,
the
policyholder.
The
vehicle
involved in the accident, however, was not covered by the
policy,
and
coverage
would
thus
be
excluded
if
Brady
"owned" the vehicle. The policy does not define the term
"owner" or "owned."
The Court of Appeals applied the same
definition
of
policy
construing
the
the
term
term
“owner”
in
“owned”
the
as
it
no-fault
had
in
statute:
“Having found that the decedent was not the ‘owner’ of the
vehicle under the no-fault act, we also find that he did
not own the vehicle pursuant to the insurance policy.”
251
Mich App 490.
The Court of Appeals erred in importing the statutory
definition of “owner” into the policy language.
There is
nothing in the plain language of the policy supporting the
application
of
the
definition
of
“owner”
in
MCL
500.3101(2)(g) to this independent, nonstatutory coverage.
An insurance policy is enforced in accordance with its
terms.
Where a term is not defined in the policy, it is
accorded its commonly understood meaning.
Allstate Ins Co
v McCarn, 466 Mich 277, 280; 645 NW2d 20 (2002).
11
Reference
to
dictionary
definitions
indicates
that
possession,
control, and dominion are among the primary features of
ownership.
See,
e.g.,
Webster=s
Merriam
Collegiate
Dictionary (10th ed, 1977) (defining "owned" as to "have or
possess"); Webster's Encyclopedic Unabridged Dictionary of
the
English
Language
(Deluxe
ed,
1994)
(listing
various
definitions of "owned," such as "to acknowledge as one's
own;
recognized
dominion,
as
etc.");
having
full
American
claim,
Heritage
authority,
Dictionary
English Language (3d ed, 1993) (defining
power,
of
the
“own” as “[t]o
have or possess” and “ownership” as “[l]egal right to the
possession of a thing”).
Brady Sies had possession and control of the vehicle,
as well as dominion and authority over the vehicle, and,
thus, would commonly be understood to have “owned” it at
the
time
of
the
accident.
The
facts
that
the
entire
purchase price had not yet been paid and that the technical
transfer of title had not yet occurred are not dispositive.
Brady, who had paid part of the purchase price and taken
control
of
the
truck
with
the
intention
of
permanently
possessing it, “owned” the vehicle as that term would be
understood in ordinary usage.
12
Because Brady "owned" the
uninsured
vehicle,
uninsured
motorist
benefits
are
not
recoverable under the policy.6
IV
Accordingly, the judgments of the Court of Appeals and the
Genesee Circuit Court are reversed, and we remand the case
to
the
circuit
court
for
entry
of
judgment
for
the
defendant.
Maura D. Corrigan
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman
6
The dissent asserts that the term “owned,” because it is
undefined in the policy, must be construed against the
drafter. We disagree. As we recently explained in Klapp v
United Ins Group Agency, Inc, 468 Mich 459; 663 NW2d 447
(2003), the rule of contra proferentem is a rule of last
resort that does not apply unless (1) there is a true
ambiguity and (2) the parties’ intent cannot be discerned.
A word is not ambiguous merely because different dictionary
definitions exist.
Koontz v Ameritech Services, Inc, 466
Mich 304, 317-318; 645 NW2d 34 (2002). The word “owned” is
not ambiguous as used in the policy.
Rather, we conclude
that the plain and ordinary meaning of that word would
include circumstances, as in the case before us, in which
an agreement for sale is reached, a portion of the purchase
price is paid, and control and dominion of the vehicle are
relinquished to the purchaser.
Although our dissenting
colleague correctly notes that the definition of "owner" in
MCL 500.3101(2)(g) addresses concepts other than possession
and control, he likewise acknowledges that the Court of
Appeals "erred in transplanting the statutory definition"
into the policy. See post at 4 n 2.
13
S T A T E
O F
M I C H I G A N
SUPREME COURT
MARK TODD TWICHEL, Personal
Representative of the Estate
of BRADY S. SIES, Deceased,
Plaintiff-Appellee,
v
No. 121822
MIC GENERAL INSURANCE
CORPORATION,
Defendant-Appellant.
________________________________
CAVANAGH, J. (concurring in part and dissenting in part).
I
concur
regarding
this case.
the
in
the
the
majority’s
personal
analysis
protection
and
insurance
conclusion
benefits
in
However, I respectfully dissent with respect to
analysis
contained
in
part
III
of
the
majority’s
opinion and its conclusion regarding the unavailability of
uninsured motorist benefits under defendant’s policy.
I
would conclude that such benefits are available.
As the majority correctly notes, the term “owned” or
“owner”
is
not
defined
in
the
policy.1
In
determining
1
The policy, however, does define such terms as “you,”
“your,” “we,” “us,” “our,” “bodily injury,” “business,”
“family member,” “occupying,” “property damage,” “trailer,”
and “insured.” The term “your covered auto” is defined as:
1. Any vehicle you own shown in the Declarations.
2. Any of the following types of vehicles on the date
you become the owner:
a. a private passenger auto;
1
whether decedent was the “owner” under the terms of the
policy, this Court examines the language of the policy and
interprets its terms pursuant “to well-established Michigan
principles of construction.”
Allstate Ins Co v McCarn, 466
Mich 277, 280; 645 NW2d 20 (2002).
must
be
enforced
in
accordance
“An insurance policy
with
its
terms.
If
not
defined in the policy, however, we will interpret the terms
of
the
policy
meaning.’”
The
in
accordance
their
‘commonly
used
Id. (internal citations omitted).
majority,
pointing
definitions,
concludes
dominion
are
among
Ante
12.
The
at
with
the
that
to
“possession,
primary
commonly
various
features
used
dictionary
control,
of
meanings
and
ownership.”
of
“own”
and
“ownership,” however, may contain additional features not
contemplated
by
the
majority.
Unlike
the
majority,
I
cannot limit the definition of the word “own” and prefer to
consider all of the features of ownership.
The common usage of a nonlegal term is to be found in
a lay dictionary.
Sands Appliance Services, Inc v Wilson,
463 Mich 231, 240-241; 615 NW2d 241 (2000).
lay
dictionary
definitions
indicates
that
Referencing
ownership
entail more than possession, dominion, and control.
may
See,
b. a pickup or van that:
(1)
has a Gross Vehicle
10,000 lbs.; and
Weight
of
less
than
(2) is
not
used
for
the
delivery
or
transportation of goods and materials unless
such use is:
(a) incidental
to
your
“business”
of
installing, maintaining or repairing
furnishings or equipment; or
(b)
for farming or ranching; . . . .
2
e.g.,
Webster’s
Third
New
International
Dictionary,
Unabridged (1966) (defining “own” as “to have or hold as
property or appurtenance: have a rightful title to whether
legal or natural,” “owner” as “one that has the legal or
rightful
title
whether
the
possessor
or
not,”
and
“ownership” as a “lawful claim or title”); Webster’s New
Twentieth
Century
Unabridged
Dictionary
(2d
ed,
1983)
(defining “owner” as “one who has the legal or rightful
title, whether he is the possessor or not”); The Oxford
English Dictionary (2d ed, v XI, 1991) (defining “owner” as
“one who has the rightful claim or title to a thing [though
he may not be in possession]”).2
In short, the common
2
These definitions are consistent with the definitions
in Black’s Law Dictionary (7th ed), which defines “own” as
“[t]o have or possess as property; to have legal title to.”
Similarly, “owner” is defined as “[o]ne who has the right
to possess, use, and convey something” and “ownership” is
defined as “[t]he collection of rights allowing one to use
and enjoy property, including the right to convey it to
others.” Id. (emphases added).
I agree with the majority that terms of the policy are
construed independently of the statute and that the Court
of Appeals erred in transplanting the statutory definition
of “owner” into the policy.
However, the statutory
definition of “owner” further illustrates the concept that
“ownership” may involve more than the features cited by the
majority under certain circumstances.
The statute defines
“owner” as:
(i) A person renting a motor vehicle or
having the use thereof, under a lease or
otherwise, for a period that is greater than 30
days.
(ii) A person who holds legal title to a
vehicle, other than a person engaged in the
business of leasing motor vehicles who is the
lessor of a motor vehicle pursuant to a lease
providing for the use of the motor vehicle by the
lessee for a period that is greater than 30 days.
3
features of “ownership” appear to involve more than mere
possession, dominion, and control.
While
it
is
clear
that
decedent
possessed
and
controlled the vehicle, it is equally clear that decedent
did not have title to the vehicle.
Instead, title remained
at all relevant times with Matthew Roach.
As such, it is
unclear whether decedent would be considered the “owner” of
the
vehicle
under
the
common
usage
of
that
term
and,
consequently, the terms of the policy itself.
Applying another “well-established Michigan principle
of construction,” I would conclude that uninsured motorist
benefits are available under the terms of the policy.
To
the extent the term “owner” is ambiguous in the policy,
such ambiguity is strictly construed against the insurer in
favor of coverage.
State Farm Mut Automobile Ins Co v
Enterprise Leasing Co, 452 Mich 25, 38-40; 549 NW2d 345
(1996).
If
dominion,
and
“ownership”
control,
merely
then
involves
decedent
is
coverage under the policy is unavailable.
contemplates
possessing
convey
title
such
to
legal
title
others,
then
and
an
possession,
“owner”
If “ownership”
the
decedent
ability
to
is
an
not
“owner” and, thus, covered under the policy.
If a fair reading of the entire contract of
insurance leads one to understand that there is
coverage
under
particular
circumstances
and
another
fair
reading
of
it
leads
one
to
understand there is no coverage under the same
circumstances the contract is ambiguous and
should be construed against its drafter and in
favor of coverage. [Raska v Farm Bureau Mut Ins
(iii) A person who has the immediate right
of possession of a motor vehicle under an
installment sale contract.
[MCL 500.3101(2)(g)
(emphasis added).]
4
and
Co of Michigan, 412 Mich 355, 362; 314 NW2d 440
(1982).]
I disagree with the majority's decision to construct a
decision favorable to defendant, rather than construing the
insurance contract against its drafter, as we are bound to
do under our principles of construction.
Raska, supra at
361-362; Universal Underwriters Ins Co v Kneeland, 464 Mich
491, 509-510; 628 NW2d 491 (2001) (CAVANAGH, J., dissenting).
While defendant deemed it appropriate to define such terms
as “you” and “we,” it failed to define an essential term
such
as
“owner.”
Accordingly,
I
dissent
from
the
majority’s conclusion that uninsured motorist benefits are
unavailable
construe
the
under
the
insurance
terms
of
contract
the
policy.
against
its
I
would
drafter
conclude that uninsured motorist benefits are available.
Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
5
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