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Frankenmuth Ins. Co. v. Poll

Court of Appeals of Michigan

July 21, 2015

FRANKENMUTH INSURANCE COMPANY, Plaintiff-Appellant,
v.
LEONARD POLL and RUTH HEUBEL, Defendants, and CITIZENS INSURANCE COMPANY OF AMERICA and HANOVER INSURANCE COMPANY, Defendants-Appellees

Kent Circuit Court. LC No. 12-006867-ND.

For FRANKENMUTH INSURANCE COMPANY, Plaintiff-Appellant: LARRY A. SMITH, SOUTHFIELD, MI; DOMINIC SILVESTRI, FRANKLIN, MI.

For LEONARD POLL, RUTH HEUBEL, Defendants: JUSTIN COLE, GRAND RAPIDS, MI.

For CITIZENS INSURANCE COMPANY OF AMERICA, HANOVER INSURANCE COMPANY, Defendants-Appellees: THOMAS MURRAY JR., GRAND RAPIDS, MI.

Before: RONAYNE KRAUSE, P.J., and MURPHY and SERVITTO, JJ.

OPINION

Page 251

[311 Mich.App. 443] Per Curiam.

In this subrogation action under the no-fault act, MCL 500.3101 et seq., plaintiff Frankenmuth Insurance Company (Frankenmuth) appeals by right the trial court's orders granting summary disposition in favor of defendants Citizens Insurance Company [311 Mich.App. 444] of America and Hanover Insurance Company (Citizens/Hanover)[1] and denying Frankenmuth's motion for reconsideration. We affirm.

The underlying facts are undisputed. Frankenmuth is the insurer of a home located in Caledonia, Michigan, owned by nonparty Bonnie Gabbert. Citizens/Hanover is the insurer of a 1999 Lincoln automobile owned by defendant Ruth Heubel. At the time of the accident tat is the subject of this appeal, Heubel's insurance policy contained a named-driver exclusion, as permitted by MCL 500.3009(2), which specifically named Heubel's son, defendant Leonard Poll, as an excluded driver and warned that all liability coverage would be void if Poll operated the Lincoln. The policy explicitly warned, inter alia, that " [w]hen a named excluded person operates a vehicle, all liability coverage is void -- no one is insured" and that one of the " legal consequences" of allowing a named excluded driver to operate the vehicle would be that " the vehicle is considered uninsured under the no-fault statute . . . ."

In September 2011, Poll was driving Heubel's Lincoln when he lost control of the vehicle and crashed into Gabbert's home, causing extensive damage. Pursuant to its homeowner's insurance policy with Gabbert, Frankenmuth paid Gabbert $108,260.42 to cover her losses. Frankenmuth then initiated this subrogation action to recover that amount from Citizens/Hanover, as the primary insurer of the Lincoln, and from Heubel and Poll individually.[2] [311 Mich.App. 445] Citizens/Hanover moved for summary disposition under MCR 2.116(C)(10), arguing that the named-driver exclusion relieved it from any insurance liability for damages caused while Poll was driving the

Page 252

Lincoln. The trial court agreed and granted the motion. It subsequently denied Frankenmuth's motion for reconsideration.

We review de novo a trial court's ruling on a motion for summary disposition. BC Tile & Marble Co, Inc v Multi Bldg Co, Inc, 288 Mich.App. 576, 583; 794 N.W.2d 76 (2010). We also review de novo issues involving statutory construction and the construction of insurance contracts. Bronson Methodist Hosp v Mich. Assigned Claims Facility, 298 Mich.App. 192, 196; 826 N.W.2d 197 (2012). The trial court properly grants a motion for summary disposition under MCR 2.116(C)(10) when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. BC Tile & Marble Co, 288 Mich.App. at 583. We review a trial court's decision on a motion for reconsideration for an abuse of discretion. Churchman v Rickerson, 240 Mich.App. 223, 233; 611 N.W.2d 333 (2000). " An abuse of discretion occurs when the trial court's decision falls outside the range of reasonable and principled outcomes." Woodington v Shokoohi, 288 Mich.App. 352, 355; 792 N.W.2d 63 (2010).

Frankenmuth argues that Citizens/Hanover, as the primary insurer of the involved vehicle, is liable for the property damage irrespective of whether Heubel was personally involved in the accident. Frankenmuth relies on the three-prong test articulated by our Supreme Court in Turner v Auto Club Ins Ass'n, 448 Mich. 22, 28-29; 528 N.W.2d 681 (1995), under which an insurer is liable for property protection insurance benefits if (1) there has been " accidental damage to tangible property [311 Mich.App. 446] arising out of the ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle," MCL 500.3121(1); (2) none of the possible exceptions to the insurer's liability enumerated in MCL 500.3123 applies; and (3) the insurer insures the owner of the vehicle " involved in the accident . . . ." (Quotation marks and citation omitted.) Frankenmuth argues that each prong is met in this ...


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