Belcher v. Aetna Cas. and Sur. Co.

• Decision Date: 30 June 1980
• Docket Number: Nos. 3,Docket Nos. 61683,62024 and 61741,s. 3
• Citation: 293 N.W.2d 594,409 Mich. 231
• Parties: Marie BELCHER, Plaintiff-Appellant, v. AETNA CASUALTY AND SURETY COMPANY, a Foreign Corporation, Defendant-Appellee. Ida Rose HAMILTON, Severally and as Next Friend of Brunette Hamilton, Valerie Hamilton, Shonda Hamilton and Rufus Hamilton, Plaintiffs-Appellants, v. AETNA CASUALTY AND SURETY COMPANY, a Foreign Insurance Company, Defendant- Appellee. Lily D. SHAFFER, Plaintiff-Appellant, v. RIVERSIDE INSURANCE COMPANY, Defendant-Appellee. Calendarto 5.
• Court: Michigan Supreme Court

Page 594

293 N.W.2d 594

409 Mich. 231

Marie BELCHER, Plaintiff-Appellant, v. AETNA CASUALTY AND SURETY COMPANY, a Foreign Corporation,

Defendant-Appellee.

Ida Rose HAMILTON, Severally and as Next Friend of Brunette

Hamilton, Valerie Hamilton, Shonda Hamilton and Rufus Hamilton, Plaintiffs-Appellants, v. AETNA CASUALTY AND SURETY COMPANY, a Foreign Insurance

Company, Defendant- Appellee.

Lily D. SHAFFER, Plaintiff-Appellant, v. RIVERSIDE INSURANCE COMPANY, Defendant-Appellee.

Docket Nos. 61683, 62024 and 61741.

Calendar Nos. 3 to 5.

Supreme Court of Michigan.

Argued Oct. 2, 1979.

Decided June 30, 1980.

Rosenbaum, Bloom, Appel & Moses by Donald E. Moses, Leslie D. Bloom, Detroit, for plaintiff-appellant in No. 61683.

Richard A. Lenter, Southfield, for plaintiffs-appellants in No. 62024.

Bridges & Collins by Brian D. Sheridan, Negaunee, for plaintiff-appellant in No. 61741.

Collins & Einhorn, P.C., Southfield, for defendant-appellee in Nos. 61683 and 62024.

William R. Smith, Marquette, for defendant-appellee in No. 61741.

MOODY, Justice.

These appeals, consolidated for the purpose of argument and decision, present the following issue for resolution:

"(A)re no-fault insurance benefits to be paid to the surviving dependent(s) of a deceased uninsured motorist?" 405 Mich. 826-827 (1979).

We hold that in all three cases the surviving dependents are not entitled to be paid no-fault benefits. The decisions of the Court of Appeals are therefore affirmed.

FACTS

BELCHER

Marie Belcher is the mother of Stacy Belcher, now deceased. On August 21, 1976, Stacy Belcher was involved in a motor vehicle accident and suffered injuries resulting in his death. No other vehicles were involved in the collision. At the time of the accident, Stacy Belcher was operating a vehicle owned by and registered to him. The security required by M.C.L Marie Belcher made application to the Assigned Claims Facility of the Michigan Department of State ³ for no-fault survivors' benefits. The application was forwarded to appellee Aetna Casualty and Surety Company (hereinafter Aetna) for investigation and handling. Following denial of her claim by Aetna, Mrs. Belcher instituted suit, as the surviving dependent of her son, to recover no-fault survivors' benefits. ⁴ An order granting Aetna's motion for summary judgment was entered on September 23, 1977. ⁵ The Court of Appeals (with one member of the panel dissenting) affirmed the decision of the trial court. 83 Mich.App. 207, 268 N.W.2d 349 (1978). Leave to appeal was granted by this Court on February 6, 1979. 405 Mich. 826.

§ 500.3101(1); M.S.A. § 24.13101(1) ¹ for the vehicle was not in effect when the accident occurred. ²

HAMILTON

Appellants are the widow and minor children of Rufus Hamilton. Rufus Hamilton died of injuries sustained when the vehicle he was operating struck a utility pole. At the time of the accident, the security required by M.C.L. § 500.3101(1); M.S.A. § 24.13101(1) was not in effect as to this vehicle which was owned by and registered to Rufus Hamilton.

Mrs. Hamilton made application to the Assigned Claims Facility for no-fault survivors' benefits for herself and the minor children. The claim, which was referred to appellee Aetna, was eventually denied by the company.

Mrs. Hamilton instituted suit to compel payment of such benefits. An order granting Aetna's motion for summary judgment was entered May 26, 1977, on the ground

that plaintiff's complaint failed to state a valid claim for relief. GCR 1963, 117.2(1). In an unpublished per curiam opinion dated August 23, 1978, the Court of Appeals (with one member of the panel dissenting) affirmed the trial court's decision, adopting the rationale of the Court of Appeals majority in Belcher, supra. This Court granted appellant's application for leave to appeal on February 6, 1979. 405 Mich. 827.

SHAFFER

Lily Shaffer is the widow of Ralph Shaffer. Ralph Shaffer died instantaneously of injuries suffered when the vehicle he owned and was operating collided with a second vehicle, owned and operated by Robert Gustafson. The requisite security was not in effect as to Mr. Shaffer's vehicle at the time of the accident. The other vehicle involved in the collision was insured under a no-fault policy issued by appellee Riverside Insurance Company (hereinafter Riverside).

Mrs. Shaffer, as widow and surviving dependent of Ralph Shaffer, applied to Riverside for payment of no-fault survivors' benefits. ⁶ Following a denial of her claim, Mrs. Shaffer brought suit to recover such benefits from Riverside. An order granting summary judgment in favor of the insurer, pursuant to GCR 1963 117.2(1), was entered on October 21, 1977. In an unpublished per curiam opinion dated June 22, 1978, the Court of Appeals affirmed the trial court's order. Leave to appeal was granted by this Court on February 6, 1979. 405 Mich. 827.

I

Enactment of the Michigan No-Fault Insurance Act ⁷ signalled a major departure from prior methods of obtaining reparation for injuries suffered in motor vehicle accidents. The Legislature modified the prior tort-based system of reparation by creating a comprehensive scheme of compensation designed to provide sure and speedy recovery of certain economic losses resulting from motor vehicle accidents. Under this system, losses are recovered without regard to the injured person's fault or negligence. M.C.L. § 500.3105(2); M.S.A. § 24.13105(2). The Act contemplates that in a majority of cases, specific recognized losses suffered as a result of motor vehicle accidents will be compensated for by a person's own insurer. M.C.L. § 500.3114(1); M.S.A. § 24.13114(1).

Owners and registrants of motor vehicles required to be registered in Michigan must maintain security for payment of benefits under personal protection insurance, ⁸ property protection insurance ⁹ and residual liability insurance. ¹⁰ M.C.L. § 500.3101(1); M.S.A. § 24.13101(1). The Legislature has thus designated owners and registrants of such vehicles as the group responsible for contributing to the insurance scheme from which no-fault benefits are payable. To ensure that this segment of the driving public obtain the requisite security the Legislature enacted the following measures:

(1) Owners and registrants of a motor vehicle for which security is required to be in effect who operate the vehicle without insurance are deemed guilty of a misdemeanor. M.C.L. § 500.3102(2); M.S.A. § 24.13102(2).

(2) Other persons who operate a motor vehicle with knowledge that the owner or registrant of the vehicle has not obtained the requisite security are deemed guilty of a misdemeanor. M.C.L. § 500.3102(2); M.S.A. § 24.13102(2).

(3) Persons required to maintain security and who fail to do so have no immunity from tort liability. Such persons are exposed to potential liability for all damages to which an injured victim may be entitled. M.C.L. § 500.3135; M.S.A. § 24.13135.

(4) An insurer who is obliged to pay personal protection insurance benefits may be able to recover the amounts paid from owners and registrants of uninsured motor vehicles or from their estates. M.C.L. § 500.3177; M.S.A. § 24.13177.

(5) The Act excludes the payment of personal protection insurance benefits under certain circumstances. M.C.L. § 500.3113; M.S.A. § 24.13113. ¹¹

The instant cases present the question of whether M.C.L. § 500.3113(b); M.S.A. § 24.13113(b) operates to exclude the payment of personal protection insurance survivors' benefits to the surviving dependents of an owner of an uninsured vehicle who is injured and dies of injuries sustained in a motor vehicle accident when the uninsured vehicle was involved in the accident. A review of the Act as a whole leads us to conclude that § 3113(b), as drafted, indicates that the Legislature intended to exclude the payment of benefits to these survivors.

II

The threshold question to be resolved where a person makes a claim for no-fault benefits is whether the injury upon which the claim is based is the type of injury which the Act is designed to compensate. Focus must be placed upon the injury. The nature of the injury and the circumstances under which it was suffered dictate whether no-fault insurance may operate as a source of recovery for losses flowing from the injury.

In cases where payment of benefits under personal protection insurance is sought, M.C.L. § 500.3105(1); M.S.A. § 24.13105(1) provides:

"Under personal protection insurance an insurer is liable to pay benefits for accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle, subject to the provisions of this chapter."

Under § 3105(1), personal protection insurance is deemed to apply to an injury where the injury satisfies the following criteria: The injury must be accidental as defined in M.C.L. § 500.3105(4); M.S.A. § 24.13105(4). ¹² The injury must be a bodily injury. Bodily injury includes death which results from the injury. M.C.L. § 500.3105(3); M.S.A. § 24.13105(3). ¹³ Finally, the accidental bodily injury must arise out of the ownership, operation, maintenance or use of a motor vehicle. ¹⁴

The circumstances present in each of the instant cases satisfy the criteria necessary to support the conclusion that accidental bodily injury arose from the operation of a motor vehicle. In each case death resulted from accidental injuries sustained during the operation of a motor vehicle. However, determining that an injury is of a type for which personal protection insurance benefits are payable does not, in any practical sense, end the inquiry. The concluding phrase of § 3105(1) states "subject to the provisions of this chapter." In order to resolve the questions of what types of losses are compensated, what persons are entitled to be compensated and what insurers are liable to pay benefits for such losses, reference to other sections of the Act is necessary.

III

The Act operates to compensate only a limited...