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November 19, 2020
In a recent, published Court of Appeals decision, Curtis Barnes v 21st Century Premier Insurance Company, the Court affirmed the trial court’s decision to deny defendant’s motions for summary disposition and directed verdict, holding that plaintiff could avail himself of PIP benefits under his grandparents’ no-fault policy because they were domiciled at the same household as meant by MCL 500.3114(1).
Plaintiff Curtis Barnes (“Barnes”) sustained injuries in a car accident on September 21, 2013, at which time his grandparents held a no-fault policy issued by Defendant, 21st Century Premier Insurance Company (“CPIC”). It is undisputed that at the time of the accident, Barnes lived in the same two-story house as his grandparents and that the property was separated into “upstairs” and “downstairs” units. The central dispute was whether these two units were one “household” under MCL 500.3114(1).
CPIC relied on the following evidence to argue they were not: 1) the units had separate entrances, living rooms, bedrooms, kitchens, bathrooms, gas and electric meters, furnaces, water heaters, thermostats, and doorbells; 2) the units were separated by an interior door equipped with a deadbolt; 3) Barnes had all he needed in the upstairs unit; 4) Barnes paid his own electric and gas bills; 5) Barnes paid for half of the mortgage and water bills for the house; and 6) on his no-fault insurance application, Barnes’ grandfather listed another grandson who lived with them in the downstairs unit as a “household member,” but did not list Barnes.
Barnes relied on the following evidence to argue the two units were one household: 1) only family members had lived in the house for nearly 50 years; 2) the cable bill was the only utility paid by Barnes; 3) the interior doors of the house were never locked; 4) Barnes regularly and freely entered the downstairs unit to do laundry and retrieve food, towels, and linen; 5) they had no rental agreement; 6) they split the cost of house repairs evenly; 7) the house had only one address; 8) the home was zoned residential, 8) Barnes and his grandparents had a very close relationship; 9) Barnes kept personal effects in the house; 10) his grandparents set rules for the upstairs unit concerning noise and company; 11) his grandparents could and did enter the upstairs unit at will without the need of his permission; 12) they cooked in each other’s units; and 13) they often shared meals together.
The Appellate Court affirmed there was a genuine issue of material fact regarding whether Barnes was domiciled in the same household as his grandparents and found there was competent evidence to support the jury’s verdict that Barnes was domiciled in the same household as his grandparents. To reach its conclusion, the Court reviewed the four factors set forth in Workman v DAIIE, 404 Mich 477 (1979) and five factors set forth in Dairyland Ins Co v Auto-Owners Ins Co, 123 Mich App 675 (1983), which were recognized in Grange Ins Co v Lawrence, 494 Mich 475 (2013), and found the factors favored Barnes because Barnes had no other place of lodging, he was living in the same house for an indefinite period of time, and he had a close and informal relationship with his grandparents. The Court also critically analyzed the term “household”, and its dictionary definition, to find that Barnes and his grandparents formed one family unit living together under the same roof.
Importantly, the Court explained that the key in this particular case was not the physical structure or design of the house, but rather the conduct and behaviors of the people living in the house in the context of that specific structure or design. The Court noted that “[i]f the evidence had conclusively established that the connecting door between the two units was always locked, that Barnes never accessed the lower unit, nor had the liberty to do so, that his grandparents never accessed the upper unit, nor had the freedom to do so, and that costs were never shared, we would conclude that Barnes and his grandparents were not ‘living together’ as a family unit in the same household and were instead, effectively, living separately in two distinct households.”
The Court added that the insurance application issue raised by CPIC was a red herring, explaining that whether the grandfather viewed Barnes as being a household member for the purpose of completing his insurance application is not determinative as to whether they were domiciled in the same household as required by MCL 500.3114(1).
Similarly unpersuasive to the Court was the discussion regarding whether Barnes was paying rent and other costs associated with the upstairs unit. The Court said this information was of “limited relevance” in determining whether two separate households exist within the same structure.