Davis v. Auto Owners Ins. Co.

• Decision Date: 01 September 1982
• Docket Number: 58249,Docket Nos. 56434
• Citation: 116 Mich.App. 402,323 N.W.2d 418
• Parties: Gene DAVIS and Doradean Davis, Plaintiffs-Appellees, and Attorney General on behalf of Michigan Department of Social Services, Intervening Plaintiff, v. AUTO OWNERS INSURANCE COMPANY, a Michigan corporation, Defendant-Appellant, and Hanover Insurance Company, a foreign corporation, Defendant-Appellee, and Transamerica Insurance Corporation of America, a Michigan corporation, Defendant-Appellee, and Anne R. Ranhoff, Beatrice M. Archambeault, Sperry Vickers Tulsa Power Transmission Systems, a Division of Sperry Corporation, a Delaware corporation, and Auto Truck Service Equipment Company, a Michigan corporation, Defendants.
• Court: Court of Appeal of Michigan — District of US

Page 418

323 N.W.2d 418

116 Mich.App. 402

Gene DAVIS and Doradean Davis, Plaintiffs-Appellees and Attorney General on behalf of Michigan Department of Social Services, Intervening Plaintiff, v.AUTO OWNERS INSURANCE COMPANY, a Michigan corporationDefendant-Appellant and Hanover Insurance Company, a foreign corporation, Defendant-Appellee and Transamerica Insurance Corporation of America, a Michigan corporation, Defendant-Appellee, and Anne R. Ranhoff, Beatrice M. Archambeault, Sperry Vickers Tulsa Power Transmission Systems, a Division of Sperry Corporation, a Delaware corporation, and Auto Truck Service Equipment Company, a Michigan corporation, Defendants.

Docket Nos. 56434, 58249.

Court of Appeals of Michigan.

Submitted March 3, 1982.

Decided May 20, 1982.

Released for Publication Sept. 1, 1982.

Church, Wyble, Kritselis, Anderson & Robinson, P. C. by Thomas H. Hay, Lansing, for plaintiffs-appellees.

Foster, Swift, Collins & Coey, P. C. by Steven L. Owen, Lansing, for Hanover, Ins. Co.

Stanton, Bullen, Nelson, Moilanen & Klaasen, P. C., Jackson, for Transamerica Ins. Co. of America.

Fraser, Trebilcock, Davis & Foster, P. C. by C. Mark Hoover, Lansing, for Auto Owners Ins. Co.

Before CAVANAGH, P. J., and ALLEN and PENZIEN, ^* JJ.

PENZIEN, Judge.

Plaintiffs, Gene and Doradean Davis, filed suit against defendants, Auto Owners Insurance Company(Auto Owners), Hanover Insurance Company(Hanover), and Transamerica Insurance Corporation of America (Transamerica), seeking no-fault benefits for injuries sustained by Gene Davis in an accident that occurred on December 16, 1979.The accident involved a parked tow truck, insured by Auto Owners, and a moving vehicle, insured by Hanover.Transamerica insured the vehicle which the tow truck was servicing at the time of the accident.In its orders dated February 19, 1981, and May 13, 1981, the trial court found Auto Owners to be primarily liable for plaintiffs' no-fault benefits.

The procedural history of this case is complicated and need not be set forth in full to resolve the issues raised herein.

However, we do note that the February 19, 1981, order granted summary judgment to plaintiffs and held Auto Owners primarily liable for plaintiffs' no-fault benefits.The order also denied Auto Owners' cross-motion for summary judgment and/or partial summary judgment in regard to primary liability for first-party coverage and workers' compensation setoff, and granted summary judgment in favor of Hanover against plaintiffs in that the primary first-party liability rested upon Auto Owners.On February 24, 1981, an order was entered granting summary judgment in favor of Transamerica.

Auto Owners filed a claim of appeal from the February 19, 1981, order.However, this claim was returned by this Court on the ground that the appeal was interlocutory and leave to appeal was required.In May of 1981, Auto Owners moved, in the trial court, for reconsideration of the order of February 19, 1981, as to the setoff issue.

In April of 1981, the Attorney General, as intervening plaintiff, requested an order granting reimbursement from Auto Owners to the Department of Social Services for medicaid payments made on plaintiffs' behalf.On May 13, 1981, an order was entered granting reimbursement to the Department of Social Services.This order also repeated the significant clauses of the February 19, 1981, order.Auto Owners filed a claim of appeal as of right from the May 13, 1981, order.Subsequently, a stipulation was filed removing the issue of reimbursement to the Department of Social Services from that appeal.

Meanwhile, a hearing was held on Auto Owners' notice for reconsideration of the February 19, 1981, order.The trial court noted that whether plaintiff was an employee and injured in the course of his employment was disputed in the present case, and ruled that Auto Owners is entitled to a setoff of workers' compensation benefits only if plaintiffGene Davis is, in fact, awarded benefits through the workers' compensation process.

In June of 1981, Auto Owners filed an application for leave to appeal from the February 19, 1981, order raising the same issues as were raised in the appeal from the May 13, 1981, order.We granted Auto Owners' application and consolidated both appeals.

I

The parties have stipulated to the following facts:

"The PlaintiffGene Davis was severely injured in an auto accident that took place on December 16, 1979.At the time of the accident the Plaintiff contends that he was employed by ... Waldo Auto Sales, although there is a dispute as to whether the plaintiff was in the course and scope of his employment at the time of the accident.* * * Auto Owners insured that tow truck under a standard No-Fault insurance policy.

"On December 16, 1979the Plaintiff had taken the tow truck to the scene of the accident (the intersection of I-96 and Grand River) to assist a stranded motorist, Beatrice M. Archambeault.The Plaintiff drove the tow truck to the right shoulder of eastbound I-96.He got out of the truck and hooked up the stranded car to the tow truck.He spent approximately 20 minutes outside the cab of the tow truck hooking the car up before the accident occurred.

"After the car was hooked up to the tow truck, the Plaintiff stood at the left rear corner of the truck and began winching the stranded car out of the ditch.At that time he was standing with both feet on the ground, one hand on the clutch lever and one hand on the power take-off lever mounted at the rear of the tow truck, operating the winch.As he was performing this operation, a motor vehicle driven by Anne Ranhoff, went out of control as it was proceeding on eastbound I-96.With his hands still on the controls, Mr. Davis turned and looked over his right shoulder and saw the Ranhoff vehicle approaching.Mr. Davis then placed his right foot in a "B-ring" welded on the bottom of the tow truck.On impact, his right leg was still in the B-ring, and his left leg was hanging beside the right leg.The Ranhoff vehicle struck the Plaintiff causing severe injuries.There was no malfunction of the truck or the winch mechanism.

"The Plaintiff testified at his deposition that in his opinion the sole cause of the accident was Ms. Ranhoff's loss of control of her vehicle.However, the Plaintiff's attorney has also claimed in this lawsuit that there were other causes of the accident; these claims relate to product liability claims against the DefendantSperry Corporation(defective design of winch) and the Defendant Auto Truck Service (defective design and installation).There is also a claim that the Defendant Archambeault was negligent for placing the Plaintiff in a dangerous situation and failing to warn the Plaintiff of the danger.

"The Plaintiff received no worker's compensation benefits from his employer.The Plaintiff's employer had no worker's compensation insurance.

"The Defendant Hanover insured the vehicle being driven by Ms. Ranhoff.The Defendant Transamerica insured the stranded vehicle owned by Ms. Archambeault."

Although it is not clear from the above stipulated facts, the winch mechanism runs off the engine of the tow truck, and the engine was running at the time the accident occurred.The caution lights on the tow truck were also flashing.Finally, plaintiffGene Davis did not maintain no-fault insurance on his own private vehicle.

II

As a threshold requirement for entitlement to no-fault benefits, a claimant must establish that he has suffered accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle.M.C.L. § 500.3105;M.S.A. § 24.13105.See also, Shinabarger v. Citizens Ins. Co., 90 Mich.App. 307, 314-315, 282 N.W.2d 301(1979), lv. den.407 Mich. 895(1979).This requirement has been met in the instant case, as it is obvious that plaintiffGene Davis's injuries arose, at least in part, out of the operation of a (moving) motor vehicle as a motor vehicle.In this regard, we note that even though the instant case also involved a parked vehicle (i.e., the tow truck)plaintiffs are not required to demonstrate that they fall within one of the three exceptions to the parked vehicle exclusion provision of the No-Fault Act, M.C.L. § 500.3106;M.S.A. § 24.13106, in order to recover no-fault benefits.Kalin v. Detroit Automobile Inter-Ins. Exchange, 112 Mich.App. 497, 316 N.W.2d 467(1982), andGutierrez v. Dairyland Ins. Co., 110 Mich.App. 126, 312 N.W.2d 181(1981).But see, Heard v. State Farm Mutual Automobile Ins. Co., 93 Mich.App. 50, 286 N.W.2d 46(1979), lv. gtd. 408 Mich. 896(1980), which applied the parked vehicle exception where the accident involved a parked vehicle and a moving vehicle.

III

Having concluded that plaintiffs are entitled to no-fault benefits, it is necessary to determine which insurance carrier is responsible for those benefits.

In this regard, Auto Owners argues that the trial court erred in finding it primarily liable to plaintiffs.Auto Owners reasons that since plaintiffGene Davis was outside the tow truck for 20 minutes prior to the accident, he was not an occupant of the tow truck at the time of the accident.Therefore, according to Auto Owners, the priority provisions of the No-Fault Act require the carriers of each of the vehicles involved in the accident to share liability.SeeM.C.L. § 500.3115;M.S.A. § 24.13115.

The liability of each carrier is governed by the priority sections, M.C.L. § 500.3114;M.S.A. § 24.13114andM.C.L. § 500.3115;M.S.A. § 24.13115, of the No-Fault Act.Section 3114 applies if Gene Davis was an occupant of the tow truck at the time of the accident.Section 3115 applies if he was not an occupant of the tow truck at the time of the accident.

The leading pre-no-fault case interpreting whether someone was an "occupant" of a motor vehicle is Nickerson v. Citizens Mutual Ins. Co., 393 Mich. 324, 224 N.W.2d 896(1975).

In that casethe...