Background
Joshua Simpson was injured while driving an uninsured vehicle titled to his live-in girlfriend, Kiera Burgos. Labser Plc and Northland Radiology treated Simpson and sought personal protection insurance benefits from Farmers Insurance Exchange, which had been assigned the claim through Michigan’s Assigned Claims Plan. The providers sued both as Simpson’s assignees and under the direct-action provision of MCL 500.3112.
Farmers argued Simpson was disqualified from PIP benefits because he was a constructive owner of the uninsured vehicle. The record showed that Simpson was its primary driver, kept its keys, used it without requesting permission, paid for gas and maintenance, used it for work on a house he owned, and handled its towing and sale after the crash. The trial court initially denied summary disposition but, on reconsideration, ruled for Farmers.
The Court’s Holding
The Michigan Court of Appeals affirmed. It held there was no genuine factual dispute that Simpson was an owner under MCL 500.3101(3)(l)(i), despite Burgos holding title and having bought the vehicle less than two weeks before the accident. Constructive ownership turns on the nature and anticipated duration of a person’s proprietary or possessory right to use the vehicle, not on actual use exceeding 30 days, exclusive use, or a written agreement.
Because Simpson constructively owned an uninsured vehicle involved in the crash, MCL 500.3113(b) disqualified him from PIP benefits. The court further held that the providers’ direct cause of action under MCL 500.3112 did not permit recovery here. Their treatment was not for an injury “covered by personal protection insurance,” and Mota-Peguero’s rule concerning equitable rescission of a fraudulently obtained insurance policy did not apply where no policy existed.
Key Takeaways
- A person may constructively own a vehicle without title, exclusive use, a written agreement, or more than 30 days of actual use.
- Regular, unrestricted, proprietary use can establish constructive ownership when the arrangement is expected to continue beyond 30 days.
- A provider’s direct claim under MCL 500.3112 does not override the no-fault act’s express disqualification of the injured person’s claim from PIP coverage.
Why It Matters
The decision limits providers’ ability to use MCL 500.3112 to obtain Assigned Claims Plan benefits when the underlying injury is expressly excluded from PIP coverage. A statutory direct cause of action remains available to qualifying providers, but it does not create coverage for treatment of an injured person disqualified under MCL 500.3113(b).
For ownership disputes, the opinion emphasizes the practical realities of vehicle control and use. Evidence of unrestricted access, primary driving responsibility, financial contributions, and post-accident control may establish constructive ownership even shortly after a vehicle’s purchase.