Ohio Cas. Ins. Group v. Robinson

• Citation: 338 N.W.2d 898,127 Mich.App. 138
• Decision Date: 15 September 1983
• Docket Number: Docket No. 62145
• Parties: OHIO CASUALTY INSURANCE GROUP, Plaintiff-Appellee, v. Eugene ROBINSON and Edith Robinson, Defendants, and Transamerica Insurance Group, Defendant-Appellant.
• Court: Court of Appeal of Michigan (US)

Page 898

338 N.W.2d 898

127 Mich.App. 138

OHIO CASUALTY INSURANCE GROUP, Plaintiff-Appellee, v. Eugene ROBINSON and Edith Robinson, Defendants and Transamerica Insurance Group, Defendant-Appellant.

Docket No. 62145.

Court of Appeals of Michigan.

Submitted Dec. 14, 1982.

Decided July 11, 1983.

Released for Publication Sept. 15, 1983.

Davidson, Gotshall, Kohl, Secrest, Wardle, Lynch & Clark by Mark E. Morley, Farmington Hills, for plaintiff-appellee.

Ready, Sullivan & Ready by Michael L. Heller, Monroe, for defendant-appellant Transamerica Ins. Group.

Before CYNAR, P.J., and KAUFMAN and MacKENZIE, JJ.

KAUFMAN, Judge.

On January 20, 1978, Eugene Robinson drove his pickup truck to Tom Marks's Garage, a repair garage owned by Tom Marks. Robinson went there to pick up a hydraulic jack. As Robinson and Marks were loading the jack into the truck, Robinson slipped on some grease on the garage floor. He fell and suffered a back injury.

Eugene and Edith Robinson sued Tom Marks for negligence. Mr. Marks's insurer, Ohio Casualty Insurance Group, brought this action for declaratory relief to establish that Mr. Marks is also an insured under Mr. Robinson's automobile policy with Riverside Insurance Company, a member of the Transamerica Group. ¹ Under Ohio Casualty's theory, if Mr. Marks were an insured under the Transamerica policy, then Ohio Casualty would not be solely liable for Mr. Robinson's injuries. The Monroe County Circuit Court granted summary judgment for Ohio Casualty on January 6, 1982. Transamerica appeals.

In this case we are faced with the confusing task of determining whether the noninjured party (Mr. Marks) to the accident would be covered by the injured party's insurance policy (Mr. Robinson's policy with Transamerica). Transamerica raises four issues in this regard, which we now consider.

I

Transamerica first argues that Marks was not "using" the truck and therefore is not a defined insured under the Transamerica policy. In Section I of the policy Transamerica agrees to pay for injuries "arising out of the ownership, maintenance, or use of the insured automobile, including the loading and unloading thereof". It is nowhere required in the policy that the "user" also be the driver, and case law does not impose such a construction. See, e.g., BASF Wyandotte Corp. v. Transport Ins. Co., 523 F.Supp. 515 (ED Mich.1981). The clear wording of the Transamerica policy designates Mr. Marks as an "insured" while he is loading or unloading the insured vehicle. We therefore find no error in the trial court's conclusion that Mr Marks was "using" the vehicle when Mr. Robinson was injured.

II

Transamerica next argues that Mr. Marks was specifically excluded from coverage because he is a "person operating a repair shop". Section III of the policy provides that:

"The insurance with respect to any person or organization other than the Named Insured or spouse does not apply:

"(1) to any person or organization or to any agent or employee thereof, operating an automobile sales agency, repair shop, service station, storage garage or public parking place, with respect to any occurrence arising out of the operation thereof * * *."

Ohio Casualty argues that Mr. Marks did not operate "an automobile sales agency [or] repair shop" under the policy because he repaired trucks and trailers, not automobiles. Assuming for the sake of argument that only "automobile" repair shops are excluded from coverage, we believe Mr. Marks's business fits within the exclusionary language of Transamerica's policy. ² We conclude this because of the policy's definition of "automobile" in Section IV:

"Except where specifically stated to the contrary, the word 'automobile' wherever used shall include its equipment and other equipment permanently attached thereto and shall mean the described automobile, a land motor vehicle, trailer, semi-trailer or house-trailer, not operated on rails or crawler-treads, but, except with respect to Section (2) Coverage C Medical Payments, none of the foregoing shall include a motorcycle unless specifically described in the Policy, and except while actually upon public roads, does not mean a farm type tractor or equipment * * *."

A truck is a "land motor vehicle", M.C.L. § 475.1; M.S.A. § 22.531, and is nowhere excluded by the policy from the "automobile" definition. In fact, the insured "automobile" in this case is a truck. The trial court found, though, that Mr. Marks was not excluded under Section III. This finding is clearly erroneous and merits reversal.

III

Transamerica raises as its third issue the argument that Mr. Marks was not a named insured under the "use of other automobiles" section of the Transamerica policy. We are unable to consider this issue because it was not addressed by the trial court.

IV

In its final issue, Transamerica argues that, if Tom Marks is an insured under the Transamerica policy, Ohio Casualty would still be obligated to pay as the primary insurer of the Marks premises under Ohio Casualty's policy. That policy states:

"The insurance afforded by this policy is primary insurance, except when stated to apply in excess of or contingent upon the absence of other insurance. When this insurance is primary and the insured has other insurance which is stated to be applicable to the loss on an excess or contingent basis, the amount of the company's liability under this policy shall not be reduced by the existence of such other insurance.

"When both this insurance and other insurance apply to the loss on the same basis, whether primary, excess or contingent, the company shall not be liable under this policy for a greater proportion of the loss than that stated in the applicable contribution provision below * * *."

Transamerica argues that the Ohio Casualty policy establishes primary liability by Ohio Casualty to the policy limit of $100,000. Ohio Casualty argues that the Transamerica policy applies "on the same basis", and therefore Transamerica has pro rata liability. As discussed in the second issue, the Transamerica policy excludes Mr. Marks as the operator of a repair shop. The Transamerica policy therefore does not apply "on the same basis" as the Ohio Casualty policy, and Transamerica has no pro rata liability.

V

As mentioned earlier, this case involves a determination of whether the noninjured party to the accident would be covered by the injured party's insurance policy. Throughout these proceedings the parties seem to have assumed that the Robinsons have a cause of action against the garage owner's insurer, Ohio Casualty. ³ It has become apparent in our treatment of the issues, though, that Mr. Robinson's injury arose out of the use of his vehicle as that term is used in the no-fault act. M.C.L. § 500.3105(1); M.S.A. § 24.13105(1). See M.C.L. § 500.3106(c); M.S.A. § 24.13106(c); Nickerson v. Citizens Mutual Ins. Co., 393 Mich. 324, 331, 224 N.W.2d 896 (1975). It would be contrary to the strong public policy behind the no-fault act if Transamerica were completely absolved of liability for injuries arising out of the use of an automobile it insures.

The trial court and Ohio Casualty in its brief cite 16 Couch on Insurance 2d, § 62:1 as supporting pro rata liability among insurers. The two Michigan cases cited in Couch, however, do not support pro rata liability. In Werner v. The Travelers Indemnity Co., 55 Mich.App. 390, 222 N.W.2d 254 (1974), the plaintiff's decedent was killed in an accident involving an uninsured motorist. The plaintiff's decedent and the owner-driver of the car she was riding in were insured by different companies. Despite a "pro rata" clause in the driver's policy, the Court held that his policy was the primary policy for the passenger's representative to look to for recovery. The passenger's policy was secondary and would pay only for the excess over the primary policy's limit. In Hartman v. Insurance Co. of North America, 106 Mich.App. 731, 308 N.W.2d 625 (1981), lv. den. 414 Mich. 890 (1982), a no-fault case, the Court established a "priority" of claims for injuries to a bicyclist in a bicycle-automobile accident. The bicyclist's no-fault carrier, if any, would be primarily liable, followed by the insurer of a "relative domiciled in the same household" and, finally, the insurer holding the policy on the automobile involved in the accident. See also Underhill v. Safeco Ins. Co., 407 Mich. 175, 182, 284 N.W.2d 463 (1979) (motorcyclist). Neither case stands for pro rata liability--in fact, in stark contrast, they stand for a system of priorities involving primary and secondary liability.

The difficulty which now arises involves the conflict between Mr. Robinson's no-fault policy on his automobile and Mr. Marks's garage policy. The no-fault act was intended to abolish, in part, tort determinations of fault. Shavers v. Attorney General, 402 Mich. 554, 579, 267 N.W.2d 72 (1978). By way of analogy only, two panels of this Court have held that the no-fault act's abolition of tort liability is strong enough to overcome the public policy behind the garage keeper's liability act's rebuttable presumption of negligence when a vehicle is returned damaged. Buckeye Union...