Case Name: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v. ENTERPRISE LEASING COMPANY
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1994-06-20
Citations: 206 Mich. App. 7
Docket Number: Docket No. 168790
Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v ENTERPRISE LEASING COMPANY
Judges: Before: Doctoroff, C.J., and Holbrook, Jr., Mackenzie, Wahls, Hood, Gribbs, Sawyer, Weaver, Murphy, Griffin, Neff, Fitzgerald, and Taylor, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 206
Pages: 7–16

Head Matter:
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v ENTERPRISE LEASING COMPANY
Docket No. 168790.
Submitted March 29, 1994, at Lansing.
Decided June 20, 1994, at 9:55 a.m.
Leave to appeal sought.
State Farm Mutual Automobile Insurance Company brought an action in the Wayne Circuit Court against Enterprise Leasing Company, seeking a declaration of their respective liability for damages suffered by third parties when an automobile rented from the defendant by the plaintiffs insured was involved in an accident. The rental agreement provided that the primary residual coverage would be provided by the renter’s insurer rather than the defendant. The court, Roland L. Olzark, J., granted summary disposition for the plaintiff, holding that the defendant, as the owner of the vehicle, had the primary responsibility to provide residual liability insurance. The defendant appealed. The Court of Appeals, Weaver, P.J., and Jansen, J. (Murphy, J., concurring), in an unpublished opinion per curiam, decided September 30,1993 (Docket No. 150077), reversed and remanded, the majority doing so only because of being required by Administrative Order No. 1990-6 to follow the holding in State Farm Mutual Automobile Ins Co v Snappy Car Rental, Inc, 196 Mich App 143 (1992). The Court of Appeals granted the plaintiffs petition to convene a special panel to resolve the question "whether ... a rental car company may include in its rental agreement an option allowing the permissive user of a vehicle to provide his or her own primary residual liability insurance ... or whether the car rental company must provide primary residual liability insurance for a permissive user.”
In an opinion by Judge Murphy, joined by Chief Judge Doctoroff and Judges Holbrook, Jr., Mackenzie, Hood, Gribbs, Sawyer, and Fitzgerald, the Court of Appeals held:
A car rental company may include in its rental agreement an option allowing the permissive user of a vehicle to provide the _primary residual liability insurance in accordance with the holding in State Farm Mutual Automobile Ins Co v Snappy Car Rental, Inc, 196 Mich App 143 (1992).
References
Am Jur 2d, Automobile Insurance §§ 24, 28, 238, 283, 353.
See ALR Index under Automobile Insurance.
Reversed and remanded.
Judge Weaver, joined by Judges Wahls, Grippin, Neff, and Taylor, dissenting, stated that the trial court’s order of summary disposition should be affirmed because a car rental company, as owner of the vehicle, has a statutory duty to provide primary residual liability insurance for any permissive user.
Insurance — Rental Vehicles — Optional Coverage — Priority op Coverage.
A car rental company may provide in its rental agreement that the renter of a vehicle has the option of refusing bodily injury and property damage insurance coverage by the rental company and supplying that coverage independently; such a clause establishes priority of coverage where there is other coverage for the rented vehicle.
Romain, Donofrio, Kuck & Egerer, P.C. (by Ernst W. Kuck), for the plaintiff.
Gofrank & Kelman (by Thomas M. Douglas), for the defendant.
Amicus Curiae:
Siemion, Huckabay, Bodary, Padilla, Morganti & Bowerman, P.C. (by Charles A. Huckabay and Donna M. Severyn), for Snappy Car Rental, Inc. •
Before: Doctoroff, C.J., and Holbrook, Jr., Mackenzie, Wahls, Hood, Gribbs, Sawyer, Weaver, Murphy, Griffin, Neff, Fitzgerald, and Taylor, JJ.

Opinion:
Murphy, J.
This case is before us for a resolution pursuant to Administrative Order No. 1990-6 of a conflict in the decisions of the Court of Appeals. In the previous opinion in this case, State Farm Mutual Automobile Ins Co v Enterprise Leasing Co, unpublished opinion per curiam of the Court of Appeals, decided September 30, 1993 (Docket No. 150077), this Court reversed the trial court's summary disposition in favor of plaintiff on the basis of the prior decision from this Court in State Farm Mutual Automobile Ins Co v Snappy Car Rental, Inc, 196 Mich App 143; 492 NW2d 500 (1992). Pursuant to Administrative Order No. 1990-6, we vacated the decision in this case pending resolution by this panel.
The question certified for this panel is as follows:
[WJhether pursuant to MCL 500.3101(1); MSA 24.13101(1) and MCL 257.520(b)(2); MSA 9.2220(b) (2) a car rental company may include in its rental agreement an option allowing the permissive user of a vehicle to provide his or her own primary residual liability insurance, as found in State Farm Mutual Automobile Ins Co v Snappy Car Rental, Inc, 196 Mich App 143; 492 NW2d 500 (1992), lv den 442 Mich 883 (1993); or whether the car rental company must provide primary residual liability insurance for a permissive user pursuant to its policy of insurance, as would have been the holding in State Farm Mutual Automobile Ins Co v Enterprise Leasing Co, unpublished per curiam of the Court of Appeals, decided September 30, 1993 (No. 150077), absent Administrative Order 1990-6.
We conclude that State Farm Mutual v Snappy Car Rental, supra, is the appropriate resolution and, accordingly, reverse the trial court's grant of summary disposition in favor of plaintiff-appellee.
Reversed and remanded.
Doctoroff, C.J., and Holbrook, Jr., Mackenzie, Hood, Gribbs, Sawyer, and Fitzgerald, JJ., concurred.