Auto Club Insurance Association v. Great American Insurance Company

Filing 44

OPINION AND ORDER REGARDING CROSS-MOTIONS FOR SUMMARY JUDGMENT. Granting Defendant's 35 MOTION for Summary Judgment and Denying Plaintiff's 36 MOTION for Summary Judgment. Signed by District Judge Gerald E. Rosen. (RGun)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
AUTO CLUB INSURANCE
ASSOCIATION,
Plaintiff,

Case No. 10-10879

v.

Hon. Gerald E. Rosen

GREAT AMERICAN INSURANCE
GROUP,
Defendant.
____________________________________/
OPINION AND ORDER REGARDING
CROSS-MOTIONS FOR SUMMARY JUDGMENT
At a session of said Court, held in
the U.S. Courthouse, Detroit, Michigan
on
July 7, 2011
PRESENT: Honorable Gerald E. Rosen
Chief Judge, United States District Court
I. INTRODUCTION
Plaintiff Auto Club Insurance Association commenced this action in state court on
January 15, 2010, seeking reimbursement from Defendant Great American Insurance
Group1 for personal injury protection benefits Plaintiff paid to or on behalf of non-party
Eric Joye arising from injuries he suffered when he was riding a dirt bike on a public road
and was struck by a Freightliner semi truck. Defendant removed the case to this Court on

1

Defendant states that its correct name is Great American Insurance Company, and that it
has been erroneously designated as “Great American Insurance Group” in Plaintiff’s complaint.

March 4, 2010, citing the parties’ diverse citizenship. See 28 U.S.C. §§ 1441(a), 1332(a).
By cross-motions filed in September of 2010, each party seeks an award of
summary judgment in its favor on Plaintiff’s claim for reimbursement of insurance
benefits. The parties agree that the resolution of these cross-motions is governed by a
Michigan statute that precludes the payment of personal protection insurance benefits for
accidental bodily injury if, at the time of the accident, the person seeking benefits “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.” Mich.
Comp. Laws § 500.3113(a). In Defendant’s view, this statutory exclusion from coverage
is applicable here by virtue of Mr. Joye’s operation of a stolen motorcycle without the
owner’s permission and without a valid driver’s license. Plaintiff argues, in contrast, that
the exclusion does not apply because Mr. Joye did not steal the motorcycle, but instead
believed that he was given permission to test drive the motorcycle by someone he
understood to be its owner.
These cross-motions have been fully briefed by the parties. Having reviewed the
parties’ motions, briefs, and accompanying exhibits, as well as the remainder of the
record, the Court finds that the relevant allegations, facts, and legal arguments are
adequately presented in these written submissions, and that oral argument would not aid
the decisional process. Accordingly, the Court will decide the parties’ cross-motions “on
the briefs.” See Local Rule 7.1(f)(2), U.S. District Court, Eastern District of Michigan.
This opinion and order sets forth the Court’s rulings on these motions.
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II. FACTUAL BACKGROUND
On July 24, 2008, Eric Joye was riding a Honda XR650R “dirt bike” style
motorcycle in the vicinity of Eaton Avenue and Cheyenne Street in Detroit, Michigan,
when he was struck by a Freightliner semi truck insured by Defendant Great American
Insurance Group. Mr. Joye sustained injuries to his arm, foot, knee, back, and shoulder,
and received treatment at a nearby hospital.
According to Mr. Joye, an acquaintance he identified as Matthew Buehrle had
offered to sell the Honda motorcycle,2 and he was test riding it at the time of the accident
to determine whether he would be interested in buying it. Unbeknownst to Mr. Joye,
however, the motorcycle had been reported stolen about two weeks before the accident.
The owner of the motorcycle, Steven Warns, testified that it was stolen from a parking lot
outside a Detroit bar, that he immediately reported it as stolen, that he did not know Mr.
Joye or Mr. Buehrle, and that, prior to the motorcycle being stolen, he had not given
permission to anyone to use the motorcycle.
At the time of the accident, Mr. Joye was operating the motorcycle on a public
road, intending to ride it to a vacant lot that was more suitable for testing a dirt bike. He
had no valid driver’s license at the time, with his license having been suspended since

2

As Defendant points out, Mr. Joye has not been altogether clear and consistent in
identifying the individual who offered to sell him the motorcycle. At a prior deposition taken in
a case brought by Mr. Joye against Plaintiff, he recalled that this individual might have been
named Chris, (see Plaintiff’s Motion, Ex. D, Joye 11/9/2009 Dep. at 17), and an insurance
investigator who spoke to Mr. Joye shortly after the accident likewise reported that Joye
identified the seller of the motorcycle as “a guy name[d] Chris,” (Defendant’s Response, Ex. 7).
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2003. In addition, Mr. Joye’s (suspended) license did not have the necessary indorsement
for operating a motorcycle on a public street in Michigan, see Mich. Comp. Laws §
257.312a(1), and he testified that the motorcycle had no license plate.
Because Mr. Joye had no available insurance to cover the injuries he sustained in
the accident, he applied for benefits through the Michigan Assigned Claims Facility
(“MACF”), a plan established under Michigan’s no-fault insurance law for paying
personal protection insurance benefits to individuals who suffer bodily injury in a motor
vehicle accident but have no insurance coverage. See Mich. Comp. Laws § 500.3171 et
seq. Joye’s claim was assigned to Plaintiff Auto Club Insurance Association for
handling, and Plaintiff has paid or will pay over $150,000 in benefits to or on behalf of
Mr. Joye arising from his claim. Through the present suit, Plaintiff seeks reimbursement
of these payments from Defendant, alleging that Michigan law designates Defendant as
the highest priority insurer from whom Mr. Joye may recover personal protection
insurance benefits for his injuries. See Mich. Comp. Laws § 500.3114(5) (establishing
the priority of insurers where an individual suffers accidental bodily injury “while an
operator or passenger of a motorcycle”).
III. ANALYSIS
A.

The Standards Governing the Parties’ Cross-Motions
Through the present motions, each party seeks summary judgment in its favor on

Plaintiff’s claim for reimbursement of the insurance benefits it has paid to or on behalf of
Mr. Joye. Under the pertinent Federal Rule, summary judgment is proper “if the
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pleadings, the discovery and disclosure materials on file, and any affidavits show that
there is no genuine issue as to any material fact and that the movant is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(c)(2).3 As the Supreme Court has
explained, “the plain language of Rule 56(c) mandates the entry of summary judgment,
after adequate time for discovery and upon motion, against a party who fails to make a
showing sufficient to establish the existence of an element essential to that party’s case,
and on which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett,
477 U.S. 317, 322, 106 S. Ct. 2548, 2552 (1986).
In this case, the parties are largely in agreement as to the operative facts, and the
disposition of their cross-motions turns exclusively on a question of law — namely,
whether these agreed-upon facts trigger an exclusion from insurance coverage under
Mich. Comp. Laws § 500.3113(a). Because this appeal to a statutory exclusion is an
affirmative defense as to which Defendant bears the burden of proof, Defendant may
secure an award of summary judgment in its favor only upon a showing “sufficient for the
court to hold that no reasonable trier of fact could find other than for the moving party.”
Calderone v. United States, 799 F.2d 254, 259 (6th Cir. 1986) (internal quotation marks,
citation, and emphasis omitted). More generally, in determining each party’s entitlement
to summary judgment under Rule 56, the Court must view the evidence in a light most

3

The quoted language is from the version of Rule 56 in effect at the time the parties filed
their cross-motions. The Rule has since been significantly revised and reordered, but the
underlying standard for awarding summary judgment remains the same under the amended Rule.
See Fed. R. Civ. P. 56(a) (effective December 1, 2010).
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favorable to the nonmoving party. Pack v. Damon Corp., 434 F.3d 810, 813 (6th Cir.
2006).
B.

Defendant Has Established as a Matter of Law That Mr. Joye Is Not Entitled
to No-Fault Insurance Benefits.
In contesting Plaintiff’s claim for reimbursement of the insurance benefits it has

paid to or on behalf of Eric Joye for the injuries he sustained in his July 24, 2008
motorcycle accident, Defendant relies on an exclusion set forth in Michigan’s no-fault
motor vehicle insurance statute. The pertinent statutory provision states:
A person is not entitled to be paid personal protection insurance
benefits for accidental bodily injury if at the time of the accident . . .
(a) The 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.
Mich. Comp. Laws § 500.3113. As the Michigan courts have observed, the “first level of
inquiry” under § 3113(a) is “whether the taking of the vehicle was unlawful.” Amerisure
Insurance Co. v. Plumb, 282 Mich. App. 417, 766 N.W.2d 878, 883 (2009); see also
Mester v. State Farm Mutual Insurance Co., 235 Mich. App. 84, 596 N.W.2d 205, 206
(1999). If the claimant’s taking of the motor vehicle is found to be unlawful, benefits
may nonetheless be paid if the claimant “reasonably believed that he or she was entitled
to take and use the vehicle.” Mich. Comp. Laws 500.3113(a); see also Plumb, 766
N.W.2d at 884; Mester, 596 N.W.2d at 207.
The threshold question here, then, is whether Mr. Joye had “taken unlawfully” the

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motorcycle he was riding when he sustained his injuries. In asserting that he had not,
Plaintiff argues that the statute’s “taken unlawfully” language extends only to persons
“who participated in the theft of the vehicle,” (Plaintiff’s Motion, Br. in Support at 9), and
it points to the absence of evidence that Mr. Joye was involved in the theft of the
motorcycle from its owner, Steven Warns, or that Mr. Joye even knew the vehicle was
stolen. Defendant, in contrast, reads the pertinent Michigan case law as dictating a
finding of an “unlawful taking” unless the claimant can show that he was using the
vehicle with the owner’s express or implied permission. Because the motorcycle’s
owner, Mr. Warns, did not give permission to anyone to use his motorcycle, Defendant
surmises that Mr. Joye “unlawfully took” this vehicle within the meaning of § 3113(a).
As discussed below, the Court finds that Defendant has the better of the argument on this
issue.
The leading Michigan court decision on the “taken unlawfully” element of §
3113(a) is Bronson Methodist Hospital v. Forshee, 198 Mich. App. 617, 499 N.W.2d 423
(1993). In that case, insurer Auto Club Insurance Association intervened in order to seek
reimbursement of no-fault benefits it had paid on behalf of Mark Forshee through the
MACF. On the evening when Forshee sustained his injuries, he was traveling with a
group of friends in an automobile owned by the father of one of these friends, Thomas
Pefley. Pefley was arrested during the course of the evening, and as he was being taken
away in a police cruiser, he yelled to a friend, William Morrow, to “take the car home.”
Forshee, 499 N.W.2d at 425. Morrow and Forshee did not proceed directly home,
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however, but instead purchased a case of beer and continued their evening activities. At
about 2:00 a.m., they led the police on a high speed chase and their car struck an
embankment, with both Forshee and Morrow sustaining critical injuries. Although there
was a dispute as to whether Forshee or Morrow was driving at the time of the crash, the
trial court found that Forshee was the driver of the vehicle, and this finding was not
challenged on appeal. 499 N.W.2d at 425. The question before the court, then, was
whether Forshee should be deemed under § 3113(a) to have unlawfully taken the vehicle
belonging to the father of his friend, Thomas Pefley, once Pefley was taken away by the
police earlier in the evening.
At the outset of its analysis, the Michigan Court of Appeals observed that “[t]here
has not been a great deal of case law development of what constitutes an unlawful taking”
under § 3113(a). 499 N.W.2d at 426. Thus, the court looked to cases decided under
Michigan’s owner liability statute, Mich. Comp. Laws § 257.401 et seq., which had
addressed the related question “whether a vehicle was taken with [the owner’s] consent.”
499 N.W.2d at 426. In considering these “consent” decisions, the court recognized that
the owner liability statute and § 3113(a) serve different purposes and employ different
language, and that, for example, the latter statute clearly would preclude an award of nofault benefits to “a person who steals and automobile and becomes involved in a motor
vehicle accident.” 499 N.W.2d at 426. Nonetheless, the court reasoned that “the broad
definition of ‘consent’ employed by the [Michigan] Supreme Court in the owner liability
context is of equal applicability here.” 499 N.W.2d at 426. More specifically, the court
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found that “when an owner loans his vehicle to another, it is foreseeable that the borrower
may thereafter lend the vehicle to a third party and such further borrowing of the vehicle
by the third party is, by implication, with the consent of the owner.” 499 N.W.2d at 427.
Applying this reasoning to the facts before it, the court held that Forshee was not
operating a vehicle that he had “taken unlawfully” at the time he suffered his injuries:
Thus, returning to the case at bar, under the reasoning of [a leading
Supreme Court decision under the owner liability statute], Mark Forshee’s
use of the vehicle at the time of the accident was with the owner’s consent
inasmuch as the owner, Stanley Pefley, entrusted the vehicle to his son,
Thomas, who in turn entrusted the vehicle to Morrow, who finally entrusted
it to Forshee. Given this unbroken chain of permissive use, we cannot say
that Forshee’s taking of the automobile was unlawful . . . . [T]he mere fact
that the borrower violates the restrictions placed on him by the owner does
not negate the fact that the subsequent taking by a third party is, by
implication, with the owner’s consent. Therefore, even though Stanley
Pefley had placed restrictions on the use of the vehicle he entrusted to his
son, including the specific restriction that Mark Forshee was not to use the
vehicle, the fact that the vehicle was ultimately entrusted to Forshee in
violation of those restrictions does not change the fact that the taking and
use was with the owner’s consent . . . .
499 N.W.2d at 427.
In Plumb, supra, 766 N.W.2d at 883-84, in contrast, the Michigan Court of
Appeals found that the claimant in that case, Rae Louise Plumb, had unlawfully taken a
Jeep Cherokee she was driving when she sustained her injuries. On the night of her
accident, Plumb was at a bar when the Jeep’s owner, David Shelton,4 arrived at the same

4

To be accurate, Shelton was not the titled owner of the Jeep, but instead had entered into
an agreement to purchase the vehicle and had been using it for over a month. Under these
circumstances, the court found that Shelton was “considered an ‘owner’ of the vehicle for
purposes of the no-fault act.” Plumb, 766 N.W.2d at 884.
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bar, parked his vehicle in the parking lot, and left his keys in the vehicle. Plumb and
Shelton did not know each other, and they did not speak while at the bar that night.
Plumb left the bar with two men she could not identify by name, and one of them handed
her the keys to the Jeep and asked her to drive because he was on probation. Plumb
agreed, despite having a suspended driver’s license, lacking automobile insurance, and
being intoxicated. Shelton left the bar a short time later and discovered that his Jeep was
missing. In the early hours of the following morning, Plumb was found lying in a field
near the bar and the Jeep was discovered in a nearby drainage ditch, and a police
investigation determined that Plumb had driven the vehicle away from the bar and across
the field, where she struck an electrical transformer and crashed into the ditch.
Under these facts, the Michigan Court of Appeals held that Plumb had unlawfully
taken the Jeep:
Shelton never gave the keys or permission to drive the Jeep to anyone that
night. Although Plumb asserted that she received the keys from the
unidentified man, there is no evidence that she received them from Shelton
or the titled owner or otherwise had permission to take the Jeep and,
accordingly, there is no material question of fact that Plumb lacked
Shelton’s consent or implied consent to take the Jeep . . . . Therefore, there
is no genuine issue of material fact that Plumb unlawfully took the Jeep,
and § 3113(a) applies.
Plumb, 766 N.W.2d at 884; see also Farmers Insurance Exchange v. Young, No. 275584,
2010 WL 3021860, at *4 (Mich. Ct. App. Aug. 3, 2010) (finding that a vehicle had been
taken unlawfully under § 3113(a) where “consent could not be implied through a chain of
entrustment from” the vehicle owner to the injured claimant who was operating the

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vehicle). While the court noted that there was no “evidence to suggest that Plumb had an
intent to permanently deprive Shelton of the Jeep,” it found that this lack of intent was
relevant only to a “joyriding exception” that the Michigan courts had read into the “taken
unlawfully” language of § 3113(a),5 and it explained that this exception was limited
solely to family members of the vehicle owner. Plumb, 766 N.W.2d at 884.
As Defendant observes, the facts here are analogous to those presented in Plumb,
and are readily distinguishable from the facts in Forshee. In this case, as in Plumb (but
unlike in Forshee), the owner of the vehicle had not given his permission or consent for
anyone to use his vehicle. In contrast to Forshee, 499 N.W.2d at 427, then, it cannot be
said that there is an “unbroken chain of permissive use” between the vehicle owner and
Mr. Joye (or the claimant in Plumb). Rather, Mr. Joye (like the claimant in Plumb)
“lacked [the owner’s] consent or implied consent to take” the motorcycle he was riding
when he suffered his injuries. Plumb, 766 N.W.2d at 884. Moreover, while there is no
evidence that Mr. Joye was involved in the theft of Mr. Warns’s motorcycle or “had an
intent to permanently deprive [Mr. Warns] of” his vehicle, Plumb, 766 N.W.2d at 884, the
same was true in Plumb — there, as here, the claimant was given permission to use the
vehicle by someone who, so far as the claimant knew, had the authority to grant this
permission, but the court in Plumb nonetheless concluded that the claimant had
5

Specifically, the Michigan Court of Appeals had previously held that the coverage
exclusion set forth in § 3113(a) “does not apply to cases where the person taking the vehicle
unlawfully is a family member doing so without the intent to steal but, instead, doing so for
joyriding purposes.” Butterworth Hospital v. Farm Bureau Insurance Co., 225 Mich. App. 244,
570 N.W.2d 304, 306 (1997) (footnote omitted).
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unlawfully taken the vehicle within the meaning of § 3113(a). This Michigan case law,
then, seemingly compels the conclusion that Mr. Joye unlawfully took the motorcycle he
was riding at the time he sustained his injuries.
In an effort to avoid this result, Plaintiff construes the pertinent Michigan case law
as dictating that the “unlawful taking” of a vehicle must entail some degree of
participation in the theft of the vehicle. Yet, if the absence of evidence of vehicle theft
(or the claimant’s involvement in the theft) were sufficient to overcome the § 3113(a)
exclusion, Forshee would have been far more easily decided, without the need for the
court to consider whether the claimant in that case had the express or implied permission
of the vehicle owner. There was no evidence in Forshee that the vehicle had been stolen,
and yet the court still deemed it necessary to determine whether there was an “unbroken
chain of permissive use” between the vehicle owner and the injured claimant. Forshee,
499 N.W.2d at 427. Likewise, the court in Plumb focused on the claimant’s “lack of
consent or implied consent to take the Jeep,” Plumb, 766 N.W.2d at 884, and this was
cited as the determining factor in the court’s holding that the claimant had unlawfully
taken the vehicle, even though the claimant lacked any intent to permanently deprive the
Jeep’s owner of his vehicle. See also Mester, 596 N.W.2d at 207 (“An unlawful taking
does not require an intent to permanently deprive the owner of the vehicle . . . .”).
The lone case cited by Plaintiff as turning upon the claimant’s lack of participation
in a vehicle theft, Henry Ford Health System v. Esurance Insurance Co., 288 Mich. App.
593, __ N.W.2d __, 2010 WL 2292084 (June 8, 2010), is readily distinguishable. In that
12

case, claimant Travion Hamilton was injured while riding as a passenger in a Jeep
Cherokee driven by his girlfriend, Chandra Profic, who had “borrowed the Jeep from an
acquaintance for a small fee knowing that it was a stolen vehicle.” Esurance, 2010 WL
2292084, at *1. While there was evidence that Hamilton was (or at least should have
been) aware that the vehicle had been stolen, there was “no claim that Hamilton
participated directly in taking the vehicle from the owner.” 2010 WL 2292084, at *1.
Under these facts, the Michigan Court of Appeals held that the § 3113(a) coverage
exclusion did not apply, reasoning that “we cannot find that [Hamilton] ‘had taken’ the
vehicle, let alone that he took it unlawfully.” 2010 WL 2292084, at *4. Observing that §
3113(a) refers separately to “tak[ing]” and “us[ing]” a vehicle, terms with “different
meanings,” the court found that “Hamilton used the Jeep, but he did not take the Jeep,”
explaining that he “never engaged or participated in an act through which he took
possession or gained control of the Jeep.” 2010 WL 2292084, at *4.
The facts here are different. Mr. Joye “took possession” and “gained control” of
Mr. Warns’s motorcycle when he took the vehicle for a test drive to decide whether he
wished to purchase it. This fits comfortably within the ordinary definition of “take,” as
cited by the courts in both Plumb, 766 N.W.2d at 885, and Esurance, 2010 WL 2292084,
at *5 — namely, “to get into one’s hands or possession by voluntary action.” Although
the claimant in Esurance was determined not to have “taken” the vehicle in which he was
traveling as a passenger, Mr. Joye plainly “took” the motorcycle by gaining sole and
exclusive possession of it during his test ride. Accordingly, under Esurance and the other
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above-cited case law, the Court finds that the motorcycle that Mr. Joye was operating at
the time of his injuries was “taken unlawfully” within the meaning of § 3113(a).
Nonetheless, Plaintiff may still overcome this statutory exclusion from coverage
by appealing to what the parties have termed the “safe harbor” provision of § 3113(a). In
particular, even if (as here) an individual is found to have unlawfully taken a vehicle, the
coverage exclusion does not apply if the individual “reasonably believed that he or she
was entitled to take and use the vehicle.” Mich. Comp. Laws § 3113(a). In light of the
statutory reference to “take and use,” the Michigan Court of Appeals has emphasized that
“in circumstances where the vehicle was unlawfully taken, the injured party may obtain
[personal protection insurance] benefits only if it can be shown (1) that the injured party
reasonably believed that he or she was entitled to take the vehicle and (2) that the injured
party reasonably believed that he or she was entitled to use the vehicle.” Plumb, 766
N.W.2d at 885.
Because it is clear under the pertinent case law that Mr. Joye lacked a reasonable
belief that he was entitled to use the motorcycle he was operating at the time of his
injuries, there is no need for the Court to consider whether he reasonably believed that he
was entitled to take the vehicle. Again, the decision in Plumb provides direct guidance
on the question of Mr. Joye’s entitlement to use the motorcycle. The injured party in that
case, Rae Louise Plumb, “admitted that when she got into the Jeep, she knew that she
could not legally drive because her driver’s license had been suspended,” and the record
further revealed that Plumb’s blood alcohol content at the time was “well above the legal
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limit.” Plumb, 766 N.W.2d at 886. Upon reviewing the language of § 3113(a)’s safe
harbor provision, the Michigan Court of Appeals held as a matter of law that “one cannot
reasonably believe that he or she is entitled to use a vehicle when the person knows that
he or she is unable to legally operate the vehicle.” Plumb, 766 N.W.2d at 886-87.
Because Plumb knew that she could not legally operate the Jeep in which she sustained
her injuries, the court held that she was precluded under § 3113(a) from receiving
personal protection insurance benefits. 766 N.W.2d at 887; see also Young, 2010 WL
3021860, at *5 (following Plumb in holding that the injured claimant in that case could
not have reasonably believed he was entitled to use the vehicle he was driving when he
sustained his injuries, where he lacked “a valid driver’s license and he knew it was
unlawful for him to operate the [vehicle] without a license”).
Once again, the facts here are similar to those presented in Plumb. At the time Mr.
Joye was test riding Mr. Warns’s motorcycle, his license had been suspended for several
years, and Michigan law expressly mandates a driver’s license — along with a
motorcycle indorsement, which Mr. Joye also lacked — in order to operate a motorcycle
on a public road. See Mich. Comp. Laws § 257.301(1) (“[A] person shall not drive a
motor vehicle upon a highway in this state unless that person has a valid operator’s or
chauffeur’s license with the appropriate . . . indorsements for the type or class of vehicle
being driven . . . .”); Mich. Comp. Laws § 257.312a(1) (“A person, before operating a
motorcycle upon a public street or highway in this state, shall procure a motorcycle

15

indorsement on the operator’s or chauffeur’s license.”).6 In addition, Mr. Joye testified
that the motorcycle had no license plate, but Michigan law requires that a vehicle be
properly registered “when driven or moved on a street or highway.” Mich. Comp. Laws §
257.216. Thus, as Mr. Joye acknowledged at his deposition, (see Joye 8/27/2010 Dep. at
35-36), his operation of Mr. Warns’s motorcycle on a public road was not lawful.
Under Plumb, then, it follows as a matter of law that Mr. Joye could not have
reasonably believed he was entitled to use Mr. Warns’s motorcycle at the time of his
accident.7 Because Mr. Joye unlawfully took the motorcycle within the meaning of §
3113(a), and because this statute’s safe harbor provision cannot be satisfied, the statutory

6

Although Plaintiff asserts in its motion that “[a] motorcycle [i]ndorsement is not
required in Michigan to operate a dirt bike,” (Plaintiff’s Motion, Br. in Support at 8), it cites no
authority for this proposition. In fact, the above-quoted statute expressly provides to the
contrary if a dirt bike — which readily satisfies the statutory definition of a “motorcycle,” see
Mich. Comp. Laws § 257.31 — is being operated on a “public street or highway.” Mich. Comp.
Laws § 257.312a(1).
7

As noted by Defendant, Plaintiff scarcely addresses the “use” prong of § 3113(a)’s safe
harbor provision in its motion or its response to Defendant’s motion. To the limited extent that
Plaintiff touches upon this issue, it apparently relies principally on the statement in Butterworth
Hospital, supra, 570 N.W.2d at 307, that “it is the unlawful nature of the taking, not the unlawful
nature of the use, that is the basis of the exclusion under § 3113(a).” Yet, because the court in
that case found that the injured claimant had not “unlawfully taken” the vehicle he was driving
when he sustained his injuries, the court had no occasion to address § 3113(a)’s safe harbor
provision. As the Michigan courts have repeatedly recognized, absent an unlawful taking, “the
inquiry ends because § 3113(a) does not apply.” Plumb, 766 N.W.2d at 883; see also Spectrum
Health Hospitals v. Farm Bureau Mutual Insurance Co., No. 296976, 2011 WL 683040, at *1*3 (Mich. Ct. App. Feb. 24, 2011) (dismissing as irrelevant the defendant insurer’s argument that
the claimant “was intoxicated and had no valid license at the time of the accident,” because these
facts bore only on the applicability of the safe harbor provision and the court had already
concluded that there was no unlawful taking). Here, in contrast, the facts establish that Mr. Joye
unlawfully took Mr. Warns’s motorcycle, and he therefore must avail himself of the safe harbor
provision if he is to avoid § 3113(a)’s exclusion of coverage. As explained, the Court finds as a
matter of law that this safe harbor is unavailable here.
16

exclusion of coverage is triggered, and Defendant is entitled to summary judgment in its
favor on Plaintiff’s claim for reimbursement of the no-fault benefits it has paid to or on
behalf of Mr. Joye.
IV. CONCLUSION
For the reasons set forth above,
NOW, THEREFORE, IT IS HEREBY ORDERED that Plaintiff’s September 30,
2010 motion for summary judgment (docket #36) is DENIED. IT IS FURTHER
ORDERED that Defendant’s September 21, 2010 motion for summary judgment (docket
#35) is GRANTED.

s/Gerald E. Rosen
Chief Judge, United States District Court
Dated: July 7, 2011
I hereby certify that a copy of the foregoing document was served upon counsel of record
on July 7, 2011, by electronic and/or ordinary mail.
s/Ruth A. Gunther
Case Manager

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