INSURANCE LAW

I. INTRODUCTION Insurance touches us all in many ways, whether obvious or not. For example, it facilitates commerce and allows us to shift risk from fire, accident, property loss, personal and bodily injury, and the financial loss associated with death. Insurance is an ever-present part of people’s daily lives. These shifts have a cost felt by most individuals on at least a yearly basis. Michigan is currently the home of the highest average automobile insurance premium in the United States, at $2,551 per year.1 Further, most Michigan citizens will likely see nearly 10% increases in health insurance premiums for 2015.2 Court decisions regarding insurance matters, therefore, have a real effect on Michigan citizens, even if most individuals only consider insurance as a yearly premium. II. DECISIONS OF THE MICHIGAN SUPREME COURT A. The No-Fault Act, MCL Sections 500.3101 et seq.3 Automobiles are a part of everyday life, and it is therefore little wonder that No-Fault Act cases frequently find themselves before the appellate courts of this state. 1. MCL 500.3113: Exclusion for “A Motor Vehicle or Motorcycle Which He or She Had Taken Unlawfully” 4 For the second time in two years, the Michigan Supreme Court considered the issue of joyriding and the “taken unlawfully” No-Fault exclusion.5 Lejuan Rambin, who did not own a motor vehicle, was 1. Barbara Marquand, Car Insurance Rates by State, 2014 Edition, INSURE.COM, 2014). 2. Michigan Health Insurers Propose Higher 2015 Rates, MLIVE (Jun. 27, 2014, 8:00 AM), 3. MICH. COMP. LAWS ANN. §§ 500.3101–500.3179 (West 2015). 4. Id. § 500.3113. 5. Rambin v. Allstate Ins. Co., 495 Mich. 316, 319, 852 N.W.2d 34, 35 (2014). The Michigan Supreme Court stated in Rambin that in a previous case: [w]e held a person injured while driving a motor vehicle that was taken contrary to the express prohibition of the vehicle owner cannot receive PIP benefits. We further held “that any person who takes a vehicle contrary to a provision of the Michigan Penal Code—including MCL 750.413 and MCL 2015] INSURANCE LAW 809 operating a motorcycle owned and registered to Scott Hertzog when he was involved in an accident with an uninsured motor vehicle.6 Mr. Rambin asserted that he was entitled to No-Fault benefits from either Mr. Hertzog’s No-Fault insurer, Allstate Insurance Company, or from Titan Insurance Company, which was assigned the claim by the Michigan Assigned Claims Facility; both insurers claimed that Mr. Rambin was barred from benefits because he had taken the motorcycle unlawfully.7 Mr. Rambin had joined a motorcycle club and was loaned a motorcycle by another member, Andre Smith, for use in a club ride.8 In reality, the motorcycle provided by Mr. Smith had been stolen from Mr. Hertzog weeks prior.9 The trial court granted summary disposition to the No-Fault insurers, but the Michigan Court of Appeals reversed, concluding that from the point of view of Mr. Rambin, there had not been an unlawful taking of the motorcycle.10 There was no question that MCL section 500.3113(a) precludes a person from No-Fault benefits if “[t]he person was using a motor vehicle or motorcycle which he or she had taken unlawfully, unless the person reasonably believed that he or she was entitled to take and use the vehicle.” 11 The situation at issue did not fit within precedent because Mr. Rambin “claims he did not knowingly lack authority to take the motorcycle because he believed that the person who gave him access to the motorcycle was the rightful and legal owner of it.” 12 The question was whether MCL section 750.414 was a strict liability crime, which is generally disfavored because it presumes mens rea.13 Though the statute applied “without an intent to steal,” that did not totally dispense with a mens rea requirement.14 The phrase only dispensed with “the specific intent to permanently deprive the owner of his or her property” and did not dispense with an intent to take or use without authority.15 Mr. Rambin was entitled to present evidence that he “did not knowingly lack 750.414, informally known as the ‘joyriding’ statutes—has taken the vehicle unlawfully for purposes of MCL 500.3113(a).” Rambin, 495 Mich. at 319, 852 N.W.2d at 35 (quoting Spectrum Health Hosps. v. Farm Bureau Mut. Ins. Co. of Mich., 492 Mich. 503, 509, 821 N.W.2d 117, 120 (2012)). 6. Rambin, 495 Mich. at 320–321, 852 N.W.2d at 36. 7. Id. at 321–22, 852 N.W.2d at 36–37. 8. Id. at 322–23, 852 N.W.2d at 37. 9. Id. 10. Id. at 324–25, 852 N.W.2d at 38. 11. Id. at 326, 852 N.W.2d at 39 (quoting MICH. COMP. LAWS ANN. § 500.3113(a) (West 2015)). 12. Id. at 327, 852 N.W.2d at 39. 13. Id. at 327–28, 852 N.W.2d at 39–40. 14. Id. at 330, 852 N.W.2d at 41. 15. Id. at 331, 852 N.W.2d at 42. 810 WAYNE LAW REVIEW [Vol. 60:807 authority to take the motorcycle,” and, if true, that he had not taken the motorcycle unlawfully. 16 The Michigan Supreme Court was highly skeptical of Mr. Rambin’s assertions but remanded for further proceedings on that question of fact.17 2. MCL 500.3114(1): “A Relative of Either Domiciled in the Same Household” 18 In consolidated cases, the Michigan Supreme Court considered the “domicile” of minor children of divorced parents for purposes of the NoFault Act.19 The first case involved a deceased minor, Josalyn, where “[t]he judgment of divorce granted Lawrence and Rosinski joint legal custody . . . but Rosinski was given ‘primary physical custody . . . .’”20 Lawrence was granted liberal parenting time.21 Josalyn was in a vehicle driven by Rosinski when another driver ran a stop sign and struck the Rosinski vehicle, killing Josalyn.22 Farm Bureau General Insurance of Michigan (“Farm Bureau”) insured Rosinski, while Grange Insurance Company (“Grange”) insured Lawrence; Grange denied coverage.23 In the declaratory action between Farm Bureau and Grange, the trial court concluded that Josalyn had two domiciles and therefore determined that Farm Bureau and Grange were in the same order of priority. 24 The Michigan Court of Appeals affirmed, concluding that “domicile” and “residence” for purposes of the No-Fault Act were “legally synonymous.” 25 The second case also involved a deceased minor, Sarah, with a judgment of divorce that granted joint legal custody to both parents but awarded physical custody to the father, Francis Campanelli; the mother, Tina Taylor, was permitted reasonable visitation.26 Campanelli subsequently moved the family to Tennessee and obtained an order allowing him to change the children’s domicile to Tennessee, without changing the joint legal custody.27 In 2007, sixteen-year-old Sarah stayed 16. Id. at 333, 852 N.W.2d at 43. 17. Id. at 336, 852 N.W.2d at 44. 18. MICH. COMP. LAWS ANN. § 500.3114 (West 2015). 19. Grange Ins. Co. v. Lawrence, 494 Mich. 475, 481, 835 N.W.2d 363, 365–66 (2013). 20. Id. at 482, 835 N.W.2d at 366. 21. Id. 22. Id. 23. Id. at 483, 835 N.W.2d at 367. 24. Id. at 483–84, 835 N.W.2d at 367. 25. Id. at 485, 835 N.W.2d at 368. 26. Id. at 486, 835 N.W.2d at 368–69. 27. Id. 2015] INSURANCE LAW 811 with her mother for the summer and, with Campanelli’s permission, remained with her mother in Michigan for the fall to attend school.28 In November 2007, Sarah sustained fatal injuries while a passenger in a friend’s automobile that was insured by State Farm Mutual Automobile Insurance Company (“State Farm”).29 In a declaratory action between State Farm and Automobile Club Insurance Association (ACIA), the insurer of Sarah’s uncle (with whom Sarah resided), the trial court granted summary disposition to State Farm.30 The court of appeals reversed, finding that a question of fact existed as to Sarah’s domicile.31