SCOPE OF § 3163 FOR OUT OF STATE INSURERS AND QUESTION OF FACT PRESENTED REGARDING CONSTRUCTIVE OWNERSHIP OF MOTOR VEHICLE FOR QUALIFICATION FOR NO FAULT BENEFITS
In GEICO Indemnity Co. v Belinda Goldstein, 2010 WL173775 (2009), the Michigan Court of Appeals, in an unpublished opinion, reversed summary disposition that had been entered in favor of GEICO regarding the defendant’s claim for first party no-fault benefits because there was a question of fact whether she was a constructive owner of the motor vehicle.2 Goldstein, who is afflicted with multiple sclerosis, did not own a motor vehicle nor did she live with a resident relative who owned a vehicle that had no-fault coverage. At issue was a 1992 Plymouth Acclaim that was owned by Goldstein’s mother, Sue Horwitz, a resident of New Mexico. The car was registered in New Mexico and GEICO insured the vehicle under the provisions of a New Mexico motor vehicle policy issued to Horwitz.
Horwitz planned to keep the Acclaim in Michigan so she would have access to a car whenever she visited Michigan. Also, Horwitz planned on leaving another car with her family in Houston for similar reasons. On October 15, 2005, Horwitz called GEICO for an insurance quote advising GEICO that she was keeping the Acclaim with Goldstein in Michigan, but did not advise GEICO about her daughter’s use of the vehicle. The GEICO policy was renewed five days before the accident involving the Acclaim but Horwitz did not change the insurance to reflect that Goldstein would also use the car.
By November 2005, Goldstein’s boyfriend’s vehicle had broken down and they were unable to have it repaired. Because of Horwitz’s desire that the Acclaim be in Michigan, Goldstein and her boyfriend traveled to New Mexico by train and they returned two weeks later to Michigan with Goldstein driving the Acclaim on the return trip. Goldstein acknowledged that the car was not meant for her, but rather, it was her mother’s car. She also stated that she understood that she had permission to drive it when she needed it.
Her boyfriend, Daniel Leon, agreed stating that it was “more or less for [Horwitz] to come up here to have a vehicle to help her out when she comes up here.”
Leon never drove the vehicle. Horwitz said that Goldstein had to call and ask permission any time she needed to use the Acclaim. Prior to the accident, Goldstein drove the Acclaim two or three times and could not get out very often because of her medical condition.
On December 24, 2005, Goldstein was driving herself and Leon in the Acclaim when they were involved in a motor vehicle accident suffering injuries. They were driving to a party and this was the first time they had used the Acclaim for social reasons. Horwitz claimed that Goldstein called her that day and asked for permission to use the vehicle which she had given.
One of the issues for the Michigan Court of Appeals was whether no-fault benefits are payable by an out-of-state insurer to, or on behalf of, a Michigan resident injured in an accident resulting from its non-resident insured’s ownership of a motor vehicle.
To resolve the issue, the Court of Appeals examined the “clear and unambiguous” language of MCL 500.3163(1) of the No-Fault Act which states:
An insurer authorized to transact automobile liability insurance and personal and property protection insurance in this state shall file and maintain a written certification that any accidental bodily injury or property damage occurring in this sate arising from the ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle by an out-of-state resident who is insured under its automobile liability insurance policies, is subject to the personal and property protection insurance system under this act.
The Court held that: “There is no language [in 3163] limiting an out-of-state insurer’s liability only to situations where the accidental bodily injury is sustained by its insured, nor is there any restriction on the application of the No-Fault Act. Instead, the above language unequivocally subjects the out-of-state insurer to the entire Michigan personal and property insurance system when any accidental bodily injury arising from an out-of-state insured’s ownership or use of a motor vehicle occurs.” [Italics in original.] Accordingly, because GEICO is subject to the Michigan personal and property insurance system, the Acclaim was insured under a GEICO policy, and the owner of the Acclaim was an out-of-state resident, MCL 500.3163 required GEICO to provide no- fault benefits.
The only remaining issue was whether Goldstein was a constructive owner of the vehicle barring her from recovering first party no-fault benefits because she did not maintain insurance on the vehicle. MCL 3101(1) and MCL 500.3113(b). One of the definitions of owner under the Michigan Owner’s Liability Act is a person renting a motor vehicle or having use thereof under a lease or otherwise for a period that is greater than 30 days. In reviewing the cases and the statutory language, the Court of Appeals concluded that what was contemplated by the statute was the right to use the vehicle for more than 30 days that is controlling, not the actual length of time that has elapsed. Goldstein argued that no question of fact existed regarding whether she was an owner of the Acclaim because it was undisputed that she had possession of the vehicle for less than 30 days having brought it back to Michigan on November 29, 2005. The Court of Appeals found that it was irrelevant that Goldstein might not have used the vehicle for the 30-day period or that her right to use the vehicle commenced within 30 days of the accident. Rather the Court concluded a question of fact existed regarding whether Goldstein had a right to use the vehicle for more than 30 days. The Court of Appeals observed that a finder of fact could conclude that Horwitz and Goldstein did not contemplate a relationship in which Goldstein had a continuous right to use the vehicle that would extend indefinitely, but that each request for permission to use the car constituted a separate arrangement to use the car for a distinct trip. On the other hand, a trier of fact could also conclude that Horwitz and Goldstein actually arranged for Goldstein to have primary access to the car and a general right to use the car for more than 30 days.
Therefore, as this question of fact was primarily dependent upon issues of credibility, the Court of Appeals reversed summary disposition in favor of Goldstein and remanded the case for fact finding regarding whether she had right to use the vehicle that made her a constructive owner for no-fault purposes.