If this opinion indicates that it is “FOR PUBLICATION,” it is subject to 

revision until final publication in the Michigan Appeals Reports.

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S T A T E O F M I C H I G A N

C O U R T O F A P P E A L S

FARM BUREAU GENERAL INSURANCE 

COMPANY OF MICHIGAN,

Plaintiff/Counterdefendant-Appellant,

FOR PUBLICATION

April 29, 2021

9:05 a.m.

v No. 352753

Kent Circuit Court

ACE AMERICAN INSURANCE COMPANY, LC No. 13-010616-CK

Defendant/Cross-Defendant-Appellee,

and

MARK RUECKERT and MARYAN PETOSKEY,

Defendants,

and

ROBYNN RUECKERT,

Defendant/Counterplaintiff/CrossPlaintiff,

and

BRISTOL WEST PREFERRED INSURANCE 

COMPANY,

Defendant.

Before: SHAPIRO, P.J., and CAVANAGH and REDFORD, JJ.

SHAPIRO, P.J.

In this insurer-priority dispute, plaintiff Farm Bureau General Insurance Company of 

Michigan (Farm Bureau) appeals by right the trial court’s opinion and order denying Farm 

Bureau’s request for equitable rescission as to third party Robynn Rueckert following an 

evidentiary hearing. For the reasons stated in this opinion, we affirm.
-2-

I. BACKGROUND

This case concerns a no-fault policy that Mark Rueckert and his step-daughter Maryan 

Petoskey procured from Farm Bureau. Robynn is Mark’s wife and Maryan’s mother; all three 

lived together when the policy was obtained. On February 25, 2013, Mark and Maryan went to 

the Farm Bureau office near their home to purchase a no-fault policy for a 1996 Dodge Ram van 

that they jointly own. Jeffry Brandt was the Farm Bureau insurance agent at the office. Both Mark 

and Maryan testified that Robynn was present, and Brandt, testifying years later, could not recall 

if she was.

1 Brandt’s main recollection was that Mark and Maryan were adamant that they would 

be the only drivers of the vehicle.

2

Mark and Maryan were required to complete an insurance application for Farm Bureau, 

and a membership application for Farm Bureau’s parent company, Michigan Farm Bureau. Either 

Brandt or his assistant read the questions to Mark and Maryan and then recorded their verbal 

answers. The membership application was completed in Mark’s name. Under “spouse 

information,” Robynn’s name is listed, along with her date of birth and partial social security 

number. On the insurance application, only Mark and Maryan are listed as owners or drivers of 

the vehicle. The next section, which directed the applicants to “[l]ist all vehicle owners, residents 

of household, and/or separate spouse not listed above,” was left blank. Mark’s marital status is 

listed as “M.” The application also contained a list of eligibility questions. Three questions are 

relevant to this case. Question 1 asks, “Do all drivers have a valid Michigan driver license?” The 

applicants answered affirmatively. Questions 9 asks if any driver within the last 36 months has 

been convicted of “operating a motor vehicle under the influence or while impaired by liquor or 

controlled substance, whether or not causing serious injury or death?”3 The applicants answered 

negatively. Question 13 asks, “Has the Applicant or a member of the Applicant’s household driven 

or moved any vehicle owned by the Applicant which has NOT had the required insurance in force 

for the preceding six months?” The applicants answered negatively and listed Bristol West

Preferred Insurance Company (Bristol West) as the previous insurer, providing the policy number 

and an expiration date of May 2, 2013. Mark provided a certificate of insurance for the Bristol 

West policy showing that the policy covered a 2006 Chevrolet Trailblazer LMT.

The first premium payment was made at the time of application, and the application was 

preapproved by Farm Bureau on March 4, 2013. Larry Clark was the Farm Bureau underwriter 

who reviewed Mark and Maryan’s application. Clark determined that the application contained 

incomplete or inaccurate information. Specifically, the application indicated that Mark was 

married but did not contain his spouse’s name or other required information. There was also 

inconsistent address information pertaining to Maryan. On March 22, 2013, Clark sent an e-mail 

to Brandt asking for information about Mark’s wife and Maryan’s address. After Brandt did not 

respond for a week, Clark decided to cancel the policy. On April 22, 2013, Farm Bureau sent 

 

1 Robynn was unable to testify due to her medical condition resulting from the accident.

2 There is no evidence that Robyn or anyone other than Mark or Maryan drove the van.

3 The application informed that if the applicant answered yes to any question 6 through 13, the 

applicant would be ineligible for insurance coverage through Farm Bureau.
-3-

Mark a letter informing him that the policy was being cancelled because of an incomplete or 

inaccurate application and that his coverage would end on May 25, 2013.

On May 22, 2013, three days before the cancellation date, Robynn was severely injured as 

a pedestrian when she was struck by a garbage truck at 4:20 a.m. The truck was making a lefthand turn and hit Robynn while she was in the crosswalk when the “walk” sign was on. Robynn 

suffered traumatic brain injuries resulting in permanent cognitive deficits. The garbage truck was 

insured by defendant ACE American Insurance Company (ACE). The 1996 Dodge Ram was not 

involved in the accident.

Farm Bureau was made of aware of Robynn’s claim for benefits under the policy when it 

received a bill from her hospital on June 21, 2013. Kurt Simon, a special investigator for Farm 

Bureau, investigated Robynn’s claim. After his investigation, Simon informed Mark and Maryan 

in a letter dated October 22, 2013, that their policy was being rescinded and declared null and void 

from its inception date for material misrepresentations in the application. Simon detailed the 

findings of his investigation, including that Robynn was Mark’s wife; that she resided at his home; 

and that Robynn’s driving record contained multiple convictions for operating under the influence 

of liquor or while intoxicated. Simon also determined that the Bristol West policy relating to the 

Chevy Trailer Blazer listed on Mark and Maryan’s February 25, 2013 application had been 

rescinded in November 2012, and that Robynn had been driving the uninsured vehicle on 

February 18, 2013, when she received a citation for driving with a suspended license. Simon 

concluded that the insurance application contained material misrepresentations because Robynn 

should have been disclosed as a driver of the insured vehicle and eligibility questions 1, 9, and 13

were answered incorrectly. 

In November 2013, Farm Bureau filed a two-count complaint seeking rescission of the 

policy and a declaratory judgment that ACE was first in priority to pay Robynn’s claim of no-fault 

benefits. In October 2014, Farm Bureau moved for summary disposition under MCR 2.116(C)(10) 

(no genuine issue of material fact). Farm Bureau argued that there were material 

misrepresentations in the application for insurance and therefore it properly rescinded the policy 

pursuant to the antifraud clause. The trial court denied summary disposition to Farm Bureau and 

granted summary disposition to ACE on the grounds that Farm Bureau’s decision to cancel the 

policy prevented it from later rescinding the policy. 

On appeal, this Court reversed, reasoning that “the insurer cannot be estopped from 

[rescinding the policy] on the basis of facts of which the insurer was actually unaware, even if 

those facts could have been easily ascertained.” Farm Bureau Gen Ins Co of Mich v ACE American 

Ins Co (Farm Bureau I), unpublished per curiam opinion of the Court of Appeals, issued 

January 19, 2017 (Docket No. 329585), p 2. The panel also rejected ACE’s argument that Farm 

Bureau could not rescind the policy as to Robynn, an innocent third party, because the innocentthird-party doctrine was no longer viable in Michigan. Id. at 3. The panel concluded that there 

was “room for disagreement whether Robynn could or should be considered a ‘driver’ within the 

meaning of the policy application,” but noted that eligibility question 13 pertained to “any other 

member of the household,” which Robynn indisputably was. The panel also noted that ACE made 

a persuasive argument that Mark and Maryan did not engage in intentional fraud, but concluded 

that Farm Bureau could seek rescission on the basis of an innocent misrepresentation. Id. at 4. In 

sum, the panel concluded that there was no genuine question of fact that Mark and Maryan made 
-4-

a material misrepresentation that entitled Farm Bureau to rescind the policy. Accordingly, the 

panel reversed the trial court’s order granting summary disposition to ACE and remanded for entry 

of summary disposition in Farm Bureau’s favor. Id. at 5.

ACE applied for leave to appeal with the Michigan Supreme Court. On July 18, 2018, the 

Supreme Court decided Bazzi v Sentinel Ins Co, 502 Mich 390, 396; 919 NW2d 20 (2018), in 

which it held that Titan Ins Co v Hyten, 491 Mich 547, 562-571; 817 NW2d 562 (2012), abrogated 

the innocent-third-party rule. However, the Court clarified that rescission was an equitable 

remedy, and that insurers did not have an “automatic” right to rescind an insurance policy with 

respect to third parties. Id. at 411. Following Bazzi, in lieu of granting leave to appeal in this case, 

the Supreme Court vacated the Court of Appeals opinion “only to the extent it held that Farm 

Bureau was automatically entitled to rescission as a matter of law,” and remanded to the trial court 

“to determine whether rescission is available as an equitable remedy as between Farm Bureau and 

Robynn Rueckert.” The Court denied leave in all other respects. Farm Bureau Gen Ins Co of 

Mich v ACE American Ins Co (Farm Bureau II), 503 Mich 903 (2018). In a concurring statement, 

Justice MARKMAN identified five nonexclusive factors for trial courts to consider in “innocentthird party cases” to determine whether rescission would be equitable. Id. at 906-907 (MARKMAN,

C.J., concurring). 

On remand, Farm Bureau and ACE engaged in additional discovery before filing 

competing motions for summary disposition under MCR 2.116(C)(10), with each party arguing 

that it was entitled to summary disposition based on application of the five factors identified by 

Justice MARKMAN. The trial court determined that it could not decide whether rescission would 

be equitable as to Robynn under the (C)(10) standard and so scheduled an evidentiary hearing. At 

the hearing, the court heard testimony from Brandt (agent), Clark (underwriter), Detective Robert 

Zabriskie (investigating officer), Justin Klaver (claims adjuster) and Simon (investigator). Mark 

and Maryan’s deposition transcripts were admitted into evidence along with numerous other 

exhibits. In a written opinion and order, the trial court found that multiple factors weighed against 

rescission and ultimately determined that rescission as to Robynn would not be equitable. The 

court reasoned that Robynn was “truly blameless, whereas Farm Bureau should be assigned some 

blame for the problems at the root of this case.” This appeal followed.

II. ANALYSIS

Farm Bureau argues that the trial court abused its discretion by denying rescission in this 

case. We disagree.4

 

4

In Pioneer State Mutual Ins Co v Wright, 331 Mich App 396, 405, 414-415; 952 NW2d 586 

(2020), this Court set forth the applicable standards of review:

The remedy of rescission is “granted only in the sound discretion of the court.” 

Lenawee Co Bd of Health v Messerly, 417 Mich 17, 26; 331 NW2d 203 (1982); see 

also [Bazzi], 502 Mich at 409. An abuse of discretion occurs when the decision 

falls outside the range of reasonable and principled outcomes. Berryman v Mackey, 
-5-

The Supreme Court’s decision in Bazzi provided the following guidance in determining 

whether rescission is warranted:

When a plaintiff is seeking rescission, “the trial court must balance the 

equities to determine whether the plaintiff is entitled to the relief he or she seeks.” 

Accordingly, courts are not required to grant rescission in all cases. For example,

“rescission should not be granted in cases where the result thus obtained would be 

unjust or inequitable,” or “where the circumstances of the challenged transaction 

make rescission infeasible.” Moreover, when two equally innocent parties are 

affected, the court is “required, in the exercise of [its] equitable powers, to 

determine which blameless party should assume the loss. . . .” “[W]here one of two 

innocent parties must suffer by the wrongful act . . . of another, that one must suffer 

the loss through whose act or neglect such third party was enabled to commit the 

wrong.” “The doctrine is an equitable one, and extends no further than is necessary 

to protect the innocent party in whose favor it is invoked.” [Bazzi, 502 Mich at 

410-411 (citations omitted).]

The Supreme Court adopted a case-by-case approach to determine whether rescission is equitable

asto third parties, stating that “an absolute approach would unduly hamper and constrain the proper 

functioning of such remedies.” Id. at 411.

As noted, following Bazzi the Supreme Court partly vacated this Court’s prior opinion in 

this case and remanded to the trial court “to determine whether rescission is available as an 

equitable remedy as between Farm Bureau and Robynn Rueckert.” Farm Bureau II, 503 Mich 

903. Justice MARKMAN wrote separately and identified five nonexclusive factors for courts to

consider in determining whether rescission as to a third party is equitable. Id. at 906-907

(MARKMAN, C. J., concurring). He also noted that the party seeking rescission has the burden of 

establishing that the remedy is warranted. Id. at 905 (MARKMAN,C.J., concurring), citing Gardner 

v Thomas R Sharp & Sons, 279 Mich 467, 469; 272 NW 871 (1937).

Justice MARKMAN’s concurring statement is not binding on this Court. See People v 

Lampe, 327 Mich App 104, 115 n 4; 933 NW2d 314 (2019). However, in Pioneer State Mutual 

Ins Co v Wright, 331 Mich App 396, 405, 411; 952 NW2d 586 (2020), we adopted Justice 

MARKMAN’S factors, concluding that they “present[] a workable framework as well as necessary 

guidance to the lower courts and the litigants . . . .” We summarized the five factors as follows:

(1) [T]he extent to which the insurer could have uncovered the subject matter of the 

fraud before the innocent third party was injured; (2) the relationship between the 

fraudulent insured and the innocent third party to determine if the third party had 

 

327 Mich App 711, 717; 935 NW2d 94 (2019). An abuse of discretion necessarily 

occurs when the trial court makes an error of law. Id. The trial court’s factual 

findings are reviewed for clear error, and a finding is clearly erroneous if the 

reviewing court is left with a definite and firm conviction that a mistake has been 

made. Id. at 717-718.
-6-

some knowledge of the fraud; (3) the nature of the innocent third party’s conduct, 

whether reckless or negligent, in the injury-causing event; (4) the availability of an 

alternate avenue for recovery if the insurance policy is not enforced; and (5) a 

determination of whether policy enforcement only serves to relieve the fraudulent 

insured of what would otherwise be the fraudulent insured’s personal liability to 

the innocent third party. [Id. at 414-415.]

In this case, the trial court considered the five factors, as well as an additional consideration, 

and concluded that, as to Robynn, rescission of the Farm Bureau policy would not be equitable. 

We will address each factor in turn.

The trial court reasoned that the first factor5 weighed against rescission because “[t]he lack 

of critical information from Mark Rueckert about his wife on the application he submitted months 

before the collision put Farm Bureau on notice that something could be awry,” yet Farm Bureau 

chose to cancel the policy instead of “conducting an investigation that in all likelihood would have 

revealed an obvious basis for rescission, i.e., Robynn Rueckert’s history of drunk driving.” The 

record supports the trial court’s conclusion that Farm Bureau exhibited a lack of professional 

diligence. Although Brandt, testifying six years after the event, could not recall if Robynn was 

present when the application was completed, both Mark and Maryan testified that she was. Brandt 

therefore had a full opportunity to ask her questions. In any event, even assuming Robynn was 

not present, the insurance application indicated that Mark was married; the membership 

application listed Robynn as his spouse; and Brandt agreed that it is assumed that a married couple 

lives together. Despite all of this, Brandt approved the insurance application that did not identify 

Robynn as a household member. Although Brandt ran a “C.L.U.E” (comprehensive loss 

underwriting exchange) report that did not identify any other drivers for the residence, the 

application asked more broadly for any household residents to be listed. Thus, based on the record

before us, there is no justification for Brandt ignoring this obvious discrepancy.

Farm Bureau argues that, because the underwriter is the person with ultimate responsibility 

to determine eligibility for coverage, giving “partial information” to the insurance agent did not 

give effective notice to Farm Bureau that there was a household resident not identified in the 

insurance application. To the extent that Farm Bureau is arguing that it is not responsible for 

Brandt’s lack of diligence, it cites no legal authority in support of that position. Brandt testified 

 

5

Justice MARKMAN provided the following explanation of the first factor:

First, the extent to which the insurer, in fact, investigated or could have 

investigated the subject matter of the fraud before the innocent third party was 

injured, which may have led to a determination by the insurer that the insurance 

policy had been procured on a fraudulent basis. If the insurer could have with 

reasonable effort obtained information indicating that the insured had committed 

fraud in procuring the insurance policy, equity may weigh against rescission 

because the insurer may be deemed to have acted without adequate professional 

diligence in issuing and maintaining the policy. [Farm Bureau II, 503 Mich at 906

(MARKMAN, C. J., concurring).]
-7-

that he was a captive agent for Farm Bureau and a Farm Bureau employee, so there is no question 

that Brandt’s principal was Farm Bureau, the insurance company. See Harts v Farmers Ins Exch, 

461 Mich 1, 6-7; 597 NW2d 47 (1999). “The relationship between the insurer and its agent is 

controlled by the principles of agency.” Id. at 7. “[A] duly authorized agent has the power to act 

and bind the principal to the same extent as if the principal acted.” In re Estate of Capuzzi, 470 

Mich 399, 402; 684 NW2d 677 (2004). We therefore see no basis for concluding that Farm Bureau

is not responsible for Brandt’s lack of diligence, which we conclude weighs heavily against 

rescission as the trial court found. 

Even focusing only on the underwriter’s actions, the record still supports the court’s 

conclusion that Farm Bureau could have discovered the grounds for rescission with reasonable 

efforts. Clark knew there was a problem with the application because it indicated that Mark was 

married but gave no information about his spouse. However, Clark merely e-mailed Brandt for 

additional information, and when he received no response after a week, he decided to cancel the 

policy effective at a future date rather than: (a) follow up with Brandt; (b) contact the insureds; or

(c) perform any additional investigation. Indeed, Clark could have easily obtained identifying 

information about Robynn from the membership application, which provided her name, date of 

birth, and partial security number.6 While Clark testified that it was not a typical part of the 

underwriting process to obtain a copy of the membership application, he agreed that he could have 

done so. 

Farm Bureau also argues that an additional investigation into Robynn would not have 

provided grounds for rescission on eligibility question 13 because her driving record would not 

have shown that she had driven an uninsured vehicle in the past six months. Recall that in this 

Court’s prior opinion, we concluded that rescission was warranted for the applicants’ response to 

question 13 (pertaining to drivers and household residents) and indicated that there was a question 

of fact whether questions 1 and 9 (pertaining to drivers only) were falsely answered because there 

was “room for disagreement” whether Robynn should have been disclosed as a driver of the

insured vehicle. Farm Bureau I, unpub op at 4. Thus, Farm Bureau argues, Robynn’s driving 

record was not relevant to the only grounds for rescission that have been judicially determined in 

this case. But the fact remains that Farm Bureau sought rescission, in part, on the basis of Robynn 

 

6 Farm Bureau argues that the trial court’s ruling imposes a legal duty on it to discover fraud, 

contrary to Titan Ins Co, 491 Mich 547. But in Pioneer we rejected that the first factor is 

inconsistent with Titan Ins Co:

In Titan Ins Co[, 491 Mich at 572-573], our Supreme Court held that “an insurer 

may seek to avoid liability under an insurance policy using traditional legal and 

equitable remedies including cancellation, rescission, or reformation, on the ground 

of fraud made in an application for insurance, notwithstanding that the fraud may 

have been easily ascertainable and the claimant is a third-party.” The first factor 

does not impose a duty to investigate upon insurers, contrary to Titan Ins Co, but 

merely addresses the process of procurement of insurance and any information 

disclosed. [Pioneer, 331 Mich App at 412 n 6.]
-8-

not being disclosed as a driver of the insured vehicle who did not have a valid license and who had 

been convicted of operating while intoxicated in the past 36 months. Thus, an investigation into 

Robynn and her driving record before the accident would have led Farm Bureau to rescind the 

policy. Whether a jury would have ultimately agreed with Farm Bureau that Robynn should have 

been disclosed as a driver of the insured vehicle is a different question.7 In sum, the trial court did 

not clearly err by concluding Farm Bureau exhibited a lack of professional diligence that prevented 

it from discovering the grounds for rescission that it later claimed. 

As to the second factor,8the trial court noted that there was “scant evidence that Robynn 

Rueckert played an active role in procuring the policy from Plaintiff Farm Bureau,” but 

nonetheless found that this factor weighed in favor of rescission because the court “need not 

engage in a leap of logic to presume that Robynn Rueckert had some understanding that her 

husband had procured family automobile insurance for himself and her daughter without 

disclosing her driving record.” ACE argues that the court’s ruling is based on a presumption, not 

evidence, because it acknowledged there was little evidence of Robynn’s role in obtaining the 

policy. However, this factor looks to the relationship between the insured and the third party, 

suggesting that a close relationship allows for an inference that the third party knew of the fraud.

Considering Robynn’s close relationship to the insureds, as well as the insured’s testimony that 

Robynn was present when the policy was obtained, the trial court did not clearly err by finding 

that this factor weighed in favor of rescission.

Next, the trial court concluded that the third factor9 weighed against rescission because the 

court found that Robynn was blameless for the accident. Indeed, it is undisputed that Robynn was 

 

7 We also note that there is nothing in the record to suggest that Farm Bureau could not have 

discovered before the accident that the Bristol West policy had been rescinded. Further, while 

Farm Bureau wants to limit “the fraud” to the Bristol West policy for the first factor, it otherwise 

makes no such distinction and argues that Robynn was culpable for not disclosing her driving 

record at the insurance office. Farm Bureau cannot have it both ways. Either the fraud relates

solely to the application question relating to uninsured vehicles, or it concerns all of the purported 

misrepresentations.

8

Justice MARKMAN provided the following guidance on the second factor for courts to consider:

Second, the specific relationship between the innocent third party and the 

fraudulent insured. If the innocent third party possessed some knowledge of the 

fraud—perhaps because of a familial or other relationship—equity may weigh in 

favor of rescission because that individual is seeking to recover from the insurer 

despite knowledge of the fraud. [Farm Bureau II, 503 Mich at 906 (MARKMAN,

C.J., concurring).]

9 The third factor identified by Justice MARKMAN concerns 

the precise nature of the innocent third party’s conduct in the injury-causing event. 

Where the innocent third party acted recklessly or even negligently in the course of 
-9-

in the crosswalk while the walk signal was on. Farm Bureau notes that Robynn had a high blood 

alcohol content (BAC) at the time of the accident and that the investigating officer, Detective 

Zabriskie, opined that, based on the position of Robynn’s arms in the video, that she could have 

been walking quickly or running through the crosswalk. However, a high BAC and moving 

quickly through a crosswalk does not establish negligence, let alone recklessness. We also note 

that the trial court reviewed the dashcam footage that shows Robynn entering the crosswalk in a 

light-colored shirt as the truck begins to make its turn. For these reasons, the court did not clearly 

err by finding that Robynn was not at fault in the accident.

The court concluded that the fourth factor10 favored rescission because, if the Farm Bureau 

policy was rescinded, Robynn would be entitled to no-fault benefits from ACE, the insurer of the 

accident vehicle. We see no error in this determination. The trial court also noted that this result 

would be inconsistent with the no-fault priority scheme, i.e., absent rescission, Farm Bureau would 

be first in priority. This comment has spawned arguments from both parties, but it had no bearing 

on the court’s weighing of the factor. Further, it is unremarkable that rescission will result in the 

next-in-line insurer having priority. In weighing this factor, the court correctly focused on whether 

the third party had an alternative avenue for relief, and here Robynn could obtain benefits from 

ACE if rescission was granted.11

The trial court determined that the fifth factor12 weighed against rescission because Mark 

(and Maryan) would not be relieved of tort liability if the Farm Bureau policy was enforced. Farm 

 

the injury-causing event, equity may weigh in favor of rescission because the 

innocent third party could have avoided the injury by acting more prudently. [Farm 

Bureau II, 503 Mich at 906 (MARKMAN, C.J., concurring).]

10 Justice MARKMAN provided the following explanation for the fourth factor:

Fourth, whether the innocent third party possesses an alternative avenue for 

recovery absent enforcement of the insurance policy. Such an avenue for recovery 

may include, for example, the assigned claims plan or health insurance. Where the 

innocent third party possesses an alternative means of recovery, equity may weigh 

in favor of rescission because the insurer need not suffer loss because of the fraud. 

[Farm Bureau II, 503 Mich at 906-907 (MARKMAN, C.J., concurring).]

11 The availability of other coverage should not be found where the claimant would be barred from 

recovery from a different insurer because of the one-year-back rule. See Pioneer, 331 Mich App 

at 412. 

12 The fifth factor concerns

whether enforcement of the insurance policy would merely relieve the fraudulent 

insured of what would otherwise be the insured’s personal liability to the innocent 

third party. That is, whether enforcement of the insurance policy would subject the 

insurer to coverage for tort liability for an at-fault insured. In such a case, equity 

may weigh in favor of rescission because enforcement of the policy would transfer 
-10-

Bureau maintains that when the fraudulent insured is not involved in the accident, this factor is 

simply inapplicable. Indeed, after the trial court issued its opinion, we concluded in Pioneer that 

the fifth factor was inapplicable under these circumstances. See Pioneer, 331 Mich App at 414. 

Accordingly, consistent with Pioneer, the fifth factor is not applicable in this case, and it does not 

weigh either in favor of or against rescission.

As noted, the five factors identified by Justice MARKMAN are nonexclusive. In this case, 

the trial court determined that the timing of the premium refund check, which was issued six 

months after Farm Bureau initially cancelled the policy and a month after Farm Bureau decided to 

rescind the policy, weighed against rescission. It is unclear how much weight the trial court gave 

to this factor, and while we do not view it is as particularly weighty, we decline to conclude that 

the trial court erred by considering it. Farm Bureau’s failure to act to promptly, both in rescinding 

the policy and issuing the premium refund check, was a proper consideration.13

In sum, two of the factors identified by Justice MARKMAN weighed against rescission, two

weighed in favor, the fifth factor was inapplicable and a sixth factor identified by the trial court 

weighed against rescission. But the factors are not to be merely counted up, and the ultimate issue

is which innocent party should bear the loss. Farm Bureau II, 503 Mich 905, 907 (MARKMAN,

C.J., concurring). The trial court carefully weighed the equities in this case after holding a

multiday evidentiary hearing and concluded that rescission would be inequitable. We are also 

mindful that the burden was on Farm Bureau to show that rescission was warranted. Based on the 

record before us, the trial court did not abuse its discretion or commit legal error by denying 

rescission under the circumstances of this case.

Affirmed.

/s/ Douglas B. Shapiro 

/s/ Mark J. Cavanagh 

/s/ James Robert Redford 

 

liability to the innocent third party from the insured who committed the fraud to the 

insurer that did not commit wrongdoing. [Farm Bureau II, 503 Mich at 907 

(MARKMAN, C.J., concurring).] 

13 Farm Bureau argues that, in considering the equities, the trial court should have considered that 

ACE was the only insurer who had been paid a premium for the period covering the accident. 

However, Farm Bureau did receive a premium payment and was attempting to collect the unpaid 

premiums until it decided to rescind the policy. In any event, the trial court did not abuse its 

discretion by not taking the unpaid premiums into account.