November 22, 2016
In the recent published decision of Laura Monaco, Personal Representative of the Estate of Alison Monaco v. Home-Owners Insurance Company, ___Mich. App.___ (Docket No. 329214, 11/15/16), the Michigan Court of Appeals affirmed the trial court’s ruling on a summary disposition motion and subsequent directed verdict motion finding that the 15-year old Plaintiff decedent, who was injured while unlawfully operating a vehicle, was still entitled to PIP benefits where she had permission to drive the vehicle she was operating.
Plaintiff, Laura Monaco, as Personal Representative of the Estate of Alison Monaco, filed a claim for PIP benefits with Defendant, Home-Owners Insurance Company [“HOIC”], following an accident wherein Alison Monaco sustained injuries when the vehicle she was operating crashed into a ditch. At the time of the accident, Alison was 15 years old and had a permit to drive, but only if accompanied by a licensed parent, guardian, or 21-year old, as required by MCL 257.310e(4); she was not so accompanied when the accident occurred. In a recorded statement, Laura Monaco initially told HOIC’s insurance adjuster that Alison did not have permission to drive the vehicle when the accident occurred, however, she later changed her story during litigation and at trial testified that Alison did have permission.
Before trial, HOIC filed a Motion for Summary Disposition, arguing that Alison was barred from recovering PIP benefits under MCL 500.3113(a) because she took the vehicle unlawfully without permission, and further, that she took the vehicle unlawfully regardless of any permission considering her age and the restricted nature of the driver’s permit. The trial court denied HOIC’s motion, concluding that there was a factual issue regarding whether Alison had permission to take the vehicle, and that there was a distinction between “taking” and “using” a vehicle for purposes of MCL 500.3113(a). The matter proceeded to trial and HOIC renewed its summary disposition arguments in moving for a directed verdict, but the court rejected them. The jury eventually found that HOIC failed to prove that Alison took the vehicle without permission, rendering it liable for PIP benefits.
On appeal, HOIC did not challenge the jury’s finding that it failed to prove that Alison took the vehicle without permission, but instead, argued that Alison was not entitled to PIP benefits pursuant to MCL 500.3113(a) because she necessarily took the vehicle unlawfully given her age and restricted license. It was undisputed that Alison was only 15 years old at the time of the accident and that it was unlawful for her to drive the vehicle unaccompanied by a licensed adult under MCL 257.310e(4). The question was whether those facts barred recovery of PIP benefits under MCL 500.3113(a), which states that:
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:
(a) The person was willingly operating or willingly using a motor vehicle or motorcycle that was taken unlawfully, and the person knew or should have known that the motor vehicle or motorcycle was taken unlawfully.
The Court of Appeals focused on whether or not Alison was using a vehicle that she had “taken unlawfully”, and, in construing the “taken unlawfully” language, looked to the Michigan Supreme Court case of Spectrum Health Hosps. v. Farm Bureau Mut. Ins. Co., 492 Mich. 503, 518 (Mich. 2012). In Spectrum, the Court held that the phrase “embraces a situation in which an individual gains possession of a vehicle contrary to Michigan law.” Id. at 516-17. The Spectrum Court further found that MCL 500.3113(a) “does not apply to the lawful owner of a vehicle, even if that person drives it under a circumstance that renders him or her legally unable to operate a vehicle.” Id. at 518, n.25.
In applying the “taken unlawfully” analysis laid out in Spectrum, the Michigan Court of Appeals found that “the unlawful operation or use of a motor vehicle is irrelevant with respect to examining the “taken unlawfully” phrase in MCL 500.3113(a)…” and held that Plaintiff did not gain possession of the vehicle contrary to Michigan law; rather, she unlawfully used the vehicle in violation of Michigan law. The Court stated that all of Defendant HOIC’s arguments conflate the unlawful use or operation of a motor vehicle with the unlawful taking of a vehicle, and that “taking” and “use” are not synonymous or interchangeable for purposes of MCL 500.3113(a).
 Alison tragically died in an unrelated house fire just before trial.
Garan Lucow Miller sends warm wishes
for very happy Thanksgiving!