SHEROLYN FLORENCE V HATFIELD USED CARS INC
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STATE OF MICHIGAN
COURT OF APPEALS
SHEROLYN FLORENCE, as Next Friend of
LYDELL FLORENCE, Minor,
UNPUBLISHED
March 1, 2002
Plaintiff-Appellant,
and
AUTO CLUB INSURANCE ASSOCIATION,
Intervening Plaintiff,
v
No. 227383
Wayne Circuit Court
LC No. 99-913133-NF
HATFIELD USED CARS, INC.,
Defendant-Appellee,
and
JOHN DZON,
Defendant.
Before: Jansen, P.J., and Zahra and Meter, JJ.
PER CURIAM.
Plaintiff appeals as of right from the trial court’s order granting summary disposition in
favor of defendant Hatfield Used Cars, Inc. under MCR 2.116(C)(10). We reverse and remand.
This case arises out of an automobile accident that occurred on May 15, 1998. Lydell
Florence, who was eleven years old at the time, was crossing a street and struck by a GMC van
driven by John Dzon. Dzon purchased the van from Hatfield Used Cars on May 13, 1998, but
Dzon was uninsured at the time of the accident.1 Because the van was an out-of-state vehicle,
there was no Michigan certificate of title to be signed from Hatfield Used Cars to Dzon. Rather,
1
Intervening plaintiff ACIA was the assigned carrier obligated to pay personal injury protection
benefits on behalf of Lydell Florence and ACIA seeks to recover the amount it has paid to
Florence from Hatfield Used Cars.
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Hatfield Used Cars, the owner, was required to complete an application for Michigan title to
transfer title to Dzon.
Dzon signed the application for Michigan title, but he did not date his signature. Diane
Davis, Hatfield Used Car’s agent, also signed the application and the date typewritten at the top
by Davis is May 18, 1998. The date of filing by the Secretary of State is May 20, 1998. Davis
testified at her deposition that she typed the application on May 18, 1998, and that she must have
delivered it to the Secretary of State’s office on May 18, 1998, as well. In her affidavit sworn on
December 31, 1999 (about one month after she gave her deposition), Davis averred that all the
documents were prepared and signed by Dzon on May 13, 1998. Davis also averred that she
took the documents to the Secretary of State’s office on May 18, 1998.
Plaintiff filed suit against Hatfield Used Cars and Dzon on April 29, 1999, but Dzon is
uninsured and an entry of default was filed on June 7, 1999. The issue in this case is whether
Hatfield Used Cars was the owner of the GMC vehicle at the time of the accident. Hatfield Used
Cars moved for summary disposition under MCR 2.116(C)(10) contending that all the necessary
paperwork to transfer title occurred on May 13, 1998, and that it was not the owner of the
vehicle. Plaintiff’s response was that the date of transfer, as typewritten on the application for
Michigan title, was May 18, 1998, which was three days after the accident occurred. Plaintiff
contended that there was at least a question of fact regarding the question of ownership;
however, plaintiff also moved for summary disposition contending that the trial court should find
that Hatfield Used Cars was the owner as a matter of law.
The trial court ruled that the purchase agreement showed a date of execution of May 13,
1998, and that transfer of title is effective on the date of execution. The crux of the trial court’s
ruling appears to be that the day the application for Michigan title was signed is the date of
execution. Plaintiff now appeals, arguing that the trial court erred in granting summary
disposition to Hatfield Used Cars because, under the Michigan Vehicle Code, the date of
execution of an application for Michigan title is the date that the application is completed and
filed with the Secretary of State, which in this case was May 18, 1998.
We review de novo a trial court’s ruling on a motion for summary disposition. Maiden v
Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). A motion brought under MCR
2.116(C)(10) tests the factual sufficiency of the complaint. Maiden, supra, p 120. The court is
to consider the pleadings, affidavits, admissions, depositions, and other evidence submitted by
the parties, MCR 2.116(G)(5), in a light most favorable to the party opposing the motion.
Maiden, supra, p 120. If the proffered evidence fails to establish a genuine issue regarding any
material fact, then the moving party is entitled to judgment as a matter of law. Id. Further, this
case involves statutory interpretation, which is also reviewed de novo. Adams Outdoor
Advertising, Inc v Holland, 463 Mich 675, 681; 625 NW2d 377 (2001).
Defendant Hatfield Used Car’s liability turns on whether it was the owner of the vehicle
at the time of the accident as provided by MCL 257.401(1):
This section shall not be construed to limit the right of a person to bring a
civil action for damages for injuries to either person or property resulting from a
violation of this act by the owner or operator of a motor vehicle or his or her agent
or servant. The owner of a motor vehicle is liable for an injury caused by the
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negligent operation of the motor vehicle whether the negligence consists of a
violation of a statute of this state or the ordinary care standard required by
common law. The owner is not liable unless the motor vehicle is being driven
with his or her express or implied consent or knowledge. . . .
Owner is defined in MCL 257.37 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.
(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.
The definition of owner in the Vehicle Code has been broadly construed and there may be more
than one owner of a motor vehicle. Goins v Greenfield Jeep Eagle, 449 Mich 1, 5; 534 NW2d
467 (1995), quoting Basgall v Kovach, 156 Mich App 323, 327; 401 NW2d 638 (1986).
Ownership can be transferred and an automobile dealership can effectuate such a transfer
by complying with the necessary steps as provided in MCL 257.217(4):
A dealer selling or exchanging vehicles required to be titled, within 15
days after delivering a vehicle to the purchaser, . . . shall apply to the secretary of
state for a new title, if required, and transfer or secure registration plates and
secure a certificate of registration for the vehicle . . . in the name of the purchaser.
. . . The purchaser of the vehicle . . . shall sign the application, including, when
applicable, the declaration specifying the maximum elected gross weight, as
required by subsection (1)(f), and other necessary papers to enable the dealer or
person to secure the title, registration plates, and transfers from the secretary of
state.
A transfer of ownership becomes official when either the application for title has been executed
or the actual certificate of title has been issued. Goins, supra, p 6. MCL 257.233(9) provides:
Upon the delivery of a motor vehicle and the transfer, sale, or assignment
of the title or interest in a motor vehicle by a person, including a dealer, the
effective date of the transfer of title or interest in the vehicle shall be the date of
execution of either the application for title or the assignment of the certificate.
This case turns on the date of the execution of the application for title because there was
no Michigan title for Hatfield to sign over to Dzon. In Goins, supra, p 14, the Supreme Court
stated that the “application for title was executed when defendant [auto dealer] sent the necessary
forms to the Secretary of State.” Similarly, in Zechlin v Bridges Motor Sales, 190 Mich App
339, 342; 475 NW2d 60 (1991), this Court held that the effective date of transfer of title or
interest in a motor vehicle is the date of execution of either the application for title or the
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certificate of title. In Zechlin, the defendant filed the application for title on September 6, 1998,
with the Secretary of State, and this act was held to constitute the transfer of title.
Further, in Gazdecki v Cargill, 28 Mich App 128, 131; 183 NW2d 805 (1970), this Court
held that legal title does not pass upon mere delivery of the automobile and that the purchaser of
the vehicle must sign the applications and other necessary documents to enable the dealer to
secure the transfer of title. Lastly, this Court’s opinion in Messer v Averill, 28 Mich App 62; 183
NW2d 802 (1970), is also factually similar. In Messer, defendant Averill purchased on
automobile on June 8, 1966, was involved in an accident on June 17, 1966, and the application
for new title was made with the Secretary of State on June 18, 1966. This Court initially noted
that MCL 257.233 provides for the transfer of ownership of a vehicle and that this statute must
be followed to transfer title to a vehicle. This Court specifically held that title was not
transferred until June 18, 1966, when the dealer made the application for new title to the
Secretary of State. See Messer, supra, p 64-65.
We hold that the trial court erred in granting summary disposition in favor of Hatfield
Used Cars because the trial court erred in using the date of the sale (May 13, 1998) as being the
date of execution. The Supreme Court made clear in Goins that the application for title is
executed when it is sent to the Secretary of State, not when delivery of the vehicle is effectuated.
In the present case, although the vehicle was sold to Dzon on May 13, 1998, and he took
possession of the vehicle on that date, the undisputed evidence shows that the application for title
was not executed until May 18, 1998, when Davis delivered the forms to the Secretary of State.
Moreover, even accepting Davis’ affidavit as true that Dzon signed the application for title on
May 13, 1998, that date is not dispositive with regard to execution of the application for title.
Here, the execution of the application for title occurred on May 18, 1998, three days after the
accident.
Accordingly, the trial court erred in granting summary disposition in favor of defendant
Hatfield Used Cars because the undisputed facts of the case show that execution of the
application for title occurred on May 18, 1998, three days after the accident occurred. Therefore,
Hatfield Used Cars was an “owner” of the vehicle involved in the accident within the meaning of
the Vehicle Code. Because there is no material factual dispute with regard to when the execution
of the application for title occurred, we agree with plaintiff that she is entitled to summary
disposition as a matter of law with respect to the question of Hatfield Used Car’s ownership of
the vehicle. We reverse the trial court’s grant of summary disposition in favor of Hatfield Used
Cars, remand for entry of summary disposition in favor of plaintiff with respect to Hatfield Used
Car’s ownership of the vehicle and for further proceedings.2
2
We emphasize that we are not holding that plaintiff is entitled to summary disposition on the
entire matter, but only that she is entitled to summary disposition with regard to Hatfield Used
Car’s ownership of the vehicle. Questions concerning Hatfield Used Car’s ultimate liability will
have to be resolved on remand.
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Reversed and remanded for further proceedings. Jurisdiction is not retained.
/s/ Kathleen Jansen
/s/ Brian K. Zahra
/s/ Patrick M. Meter
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