Bianchi v. Automobile Club of Michigan

• Decision Date: 18 March 1991
• Docket Number: Docket No. 86555
• Citation: 467 N.W.2d 17,437 Mich. 65
• Court: Michigan Supreme Court
• Parties: Richard BIANCHI, Plaintiff-Appellee, v. AUTOMOBILE CLUB OF MICHIGAN, Defendant-Appellant.

Page 17

467 N.W.2d 17

437 Mich. 65

Richard BIANCHI, Plaintiff-Appellee, v. AUTOMOBILE CLUB OF MICHIGAN, Defendant-Appellant.

Docket No. 86555.

Supreme Court of Michigan.

Argued Jan. 9, 1991.

Decided March 18, 1991.

[437 Mich. 66] James D. Brittain, P.C. by James D. Brittain, Lincoln Park, Provizer, Lichtenstein, Pearlman & Phillips, P.C. (Martin N. Fealk, of counsel), Southfield, for plaintiff-appellee.

Brandt, Hanlon, Becker, Lanctot, McCutcheon, Schoolmaster & Taylor by Richard D. Haskins (John A. Lydick, of counsel), Detroit, for defendant-appellant.

OPINION

BOYLE, Justice.

The question presented is whether the plaintiff's wife's automobile insurance policy, which excluded from its optional uninsured motorist coverage injuries sustained while occupying a motor vehicle other than that named in the policy, covered injuries suffered by the plaintiff while riding his wife's motorcycle. The trial court found the coverage exclusion ambiguous, because it was unclear whether a motorcycle was a motor vehicle for purposes of the exclusion, and therefore unenforceable. The Court of Appeals affirmed. We now reverse.

I

In August, 1985, the plaintiff was riding his wife's motorcycle when he collided with an uninsured automobile. The insurance policy on the motorcycle did not provide uninsured motorist coverage. The insurance policy on the plaintiff's wife's automobile did provide such coverage, however. The plaintiff applied for benefits under that policy, but the defendant denied the claim on the basis of the policy's "other owned vehicle" exclusion, which stated that injuries suffered while occupying a motor vehicle owned by the plaintiff's wife, other than the vehicle specifically named in the policy, were not covered by the policy.

The plaintiff brought a declaratory judgment action in Wayne Circuit Court on October 9, 1985, to determine his entitlement to benefits under his wife's automobile policy. Both parties moved for summary disposition. The defendant asserted that the exclusion precluded coverage. The plaintiff claimed that the exclusion did not apply because a motorcycle was not a motor vehicle for purposes of the exclusion.

The trial court granted the plaintiff's motion, finding the coverage exclusion ambiguous and therefore unenforceable. The court concluded that it was unclear whether a motorcycle was a motor vehicle for purposes of the exclusion. As evidence of such ambiguity, it cited the policy's use of the term "occupying" in connection with the term "motor vehicle," which it thought could indicate that the latter was intended to encompass only four-wheeled vehicles. The trial court also thought that the defendant's failure expressly to refer to motorcycles in the policy contributed to the exclusion's ambiguity.

The Court of Appeals affirmed the trial court's decision in a brief unpublished opinion per curiam, Bianchi v. Auto Club of Michigan, decided March 1, 1989 (Docket No. 93830). Our grant of leave to appeal was not limited. 435 Mich. 860 (1990).

II

Uninsured motorist coverage is not required in Michigan. Bradley v. Mid-Century Ins. Co., 409 Mich. 1, 294 N.W.2d 141 (1980). Thus, the provisions of the no-fault act, M.C.L. § 500.3101 et seq.; M.S.A. § 24.13101 et seq., are not at issue in this case. The sole issue is one of contractual interpretation. Specifically, we must decide whether the uninsured motorist protection that the plaintiff's wife purchased for her jeep covered injuries the plaintiff suffered while operating his wife's motorcycle. We agree with the defendant that it did not.

The exclusionary language at issue is contained in part IV of the insurance agreement, entitled "Uninsured Motorists Insurance Coverage," and states:

"This coverage does not apply to bodily injury sustained by an Insured person:

"while occupying a motor vehicle which is owned by you or a relative unless that motor vehicle is YOUR CAR." (Emphasis in original.)

A number of the terms found in the exclusion are specifically defined in the policy. The term "motor vehicle" is defined in the uninsured motorists section:

"Motor Vehicle means a land motor vehicle or trailer, requiring vehicle registration, but does not mean:

"a vehicle used as a residence or premises;

"a vehicle, whether the accident occurs on or off the highway, which is

"a snowmobile, or

"operated on rails or crawler treads, or

"a farm-type tractor, or

"equipment designed for use principally off the highway." (Emphasis in original.)

The terms "your car" and "occupying" are defined at the beginning of the policy, under the heading "Definitions Used Throughout This Policy":

"YOUR CAR, which is the vehicle described on the Declaration Certificate and identified by a specific Vehicle Reference Number, a replacement, a temporary substitute and a trailer owned by you ....

* * * * * *

"Occupying, Occupied means in, getting into, or out of." (Emphasis in original.)

The lower courts' findings that it is unclear from the language of the exclusion and the supporting definitions whether a motorcycle is a motor vehicle for purposes of the exclusion are best stated in the Court of Appeals decision:

"In this case, the definition of a motor vehicle as a land motor vehicle or trailer, excluding five different categories of vehicles, created an ambiguity whether or not the motorcycle was intended to be subject to the exclusion. The omission of an explicit reference to motorcycles and the absence of a delineation of physical characteristics of a motor vehicle could have reinforced the insured's impression that a motorcycle lacks the status of a motor vehicle. When this ambiguity is read in conjunction with the requirement that the insured be occupying the vehicle at the time of the accident, suggesting that the operator be enclosed within the vehicle, the confusion to the reader of the policy becomes all the more apparent." (Slip op., p. 3.)

In Auto Club Ins. Ass'n v. DeLaGarza, 433 Mich. 208, 213, 444 N.W.2d 803 (1989), we stated that an insurance contract is ambiguous when its provisions are capable of conflicting interpretations. Citing our earlier opinion in Raska v. Farm Bureau Ins. Co., 412 Mich. 355, 362, 314 N.W.2d 440 (1982), we elaborated:

"A contract is said to be ambiguous when its words may reasonably be understood in different ways.

"If a fair reading of the entire contract of insurance leads one to understand that there is coverage under particular circumstances and another fair reading of it leads one to understand there is no coverage under the same circumstances the contract is ambiguous and should be construed against its drafter and in favor of coverage.

"Yet if a contract, however inartfully worded or clumsily arranged, fairly admits of but one interpretation it may not be said to be ambiguous or, indeed, fatally unclear."

In Powers v. DAIIE, 427 Mich. 602, 398 N.W.2d 411 (1986), we made clear that any ambiguity in an insurance policy drafted by an insurer is to be construed against the insurer and in favor of the insured.

While we agree with the Court of Appeals that the other-owned-vehicle exclusion in the policy before us is not a model of clarity, we cannot conclude that it, or the policy as a whole, "fairly admits" of more than one interpretation, even when construed against the defendant. In our opinion, a motorcycle plainly fits within the definition of a motor vehicle for purposes of the uninsured motorists section, and thus within the other-owned-vehicle exclusion.

III

The uninsured motorists section of the policy broadly defines "motor vehicle" to mean "a land motor vehicle or trailer, requiring vehicle registration," but expressly excludes from the definition five kinds of vehicles that might otherwise fit that description. Motorcycles are not among the stated exceptions. The question thus becomes whether a motorcycle fits within the broad definition. Plainly, it does. A motorcycle is a motor vehicle in both the common sense ¹ and the dictionary sense ² of the term, it is operated on land, and it is required to be registered. M.C.L. § 257.216; M.S.A. § 9.1916.

While the use of the term "motor vehicle" within the definition "motor vehicle" appears somewhat circular at first blush, under the circumstances it does not create an ambiguity. In context, its use indicates that for purposes of this section relating to uninsured motorists, the term is to be given its usual meaning. This contrasts, for example, with the separate definition of the term in the no-fault coverage section of the policy, ³ which limits its meaning to vehicles with more than two...