Case Name: MICHIGAN MILLERS MUTUAL INSURANCE COMPANY v. ADAMS
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1978-06-20
Citations: 84 Mich. App. 361
Docket Number: Docket No. 77-4036
Parties: MICHIGAN MILLERS MUTUAL INSURANCE COMPANY v ADAMS
Judges: Before: J. H. Gillis, P. J., and D. E. Holbrook and N. J. Kaufman, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 84
Pages: 361–371

Head Matter:
MICHIGAN MILLERS MUTUAL INSURANCE COMPANY v ADAMS
Docket No. 77-4036.
Submitted May 2, 1978, at Lansing.
Decided June 20, 1978.
Leave to appeal applied for.
Sheila Adams was killed when the car in which she was riding, owned and operated by John W. Chi, collided with an uninsured vehicle. Mr. Chi had automobile liability insurance with Allstate Insurance Company. Allstate paid the policy limit of $20,000 to the estate of Sheila Adams under that policy. Sheila Adams was also covered for injury caused by an uninsured motorist under a policy issued by Michigan Millers Mutual Insurance Company to her daughter. The limit of liability under the provisions of the contract with Michigan Millers was $40,000. The estate of Sheila Adams filed a claim against Michigan Millers. Michigan Millers then commenced an action for a declaratory judgment and for a determination of the rights of the parties under the policy issued by plaintiff. Plaintiff alleged that its liability was only $20,000, because of an "other insurance” provision containing an excess insurance clause in the insurance contract. Summary judgment for plaintiff, Ingham Circuit Court, Michael G. Harrison, J. Defendant appeals. Held:
The defendant is limited to a total recovery under the two insurance policies of $40,000 because the excess insurance clause in the Michigan Miller’s policy is clear and unambiguous in its applicability to the facts of the case and, therefore, the rights of the parties must rest on the insurance contract as written.
References for Points in Headnotes
[1] 7 Am Jur 2d, Automobile Insurance §§ 201, 202.
Apportionment of liability between automobile liability insurers one or more of whose policies provide against any liability if there is other insurance. 46 ALR2d 1163.
Apportionment of liability between liability insurers each of whose policies provides that it shall be "excess” insurance. 69 ALR2d 1122.
Apportionment of liability between automobile liability insurers where one of the policies has an "excessive insurance” clause and the other a "proportionment” or "pro rata” clause. 76 ALR2d 502.
[2] 44 Am Jur 2d, Insurance §§ 1815, 1817.
Affirmed.
D. E. Holbrook, J., dissented. He would hold that since separate premiums had been paid for uninsured motorist coverage of $20,000 and $40,000, the recovery should not be limited by an "excess insurance” clause in an "other insurance” provision where the parties have stipulated that the damages exceed $60,000. The estate should be allowed to recover $40,000 from Michigan Millers. He would reverse.
Opinion op the Court
1. Automobiles — Insurance—Excess Insurance — Rights op Parties.
The rights of the parties to an automobile liability insurance contract, as provided in an "excess insurance” clause in the contract, must rest on the contract as written where that clause is clear and unambiguous.
Dissent by D. E. Holbrook, J.
2. Insurance — Premiums—Other Insurance Clause — Limiting Coverage.
It is unconscionable to allow an insurance company to collect premiums for coverage on the one hand and on the other hand use an "other insurance” clause to take the coverage away.
Willingham, Cote, Hanslovsky, Griffith & Fores-man, P. C. (by Marianne E. Samper), for plaintiff.
Dunnings and Canady, P. C, for defendant.
Before: J. H. Gillis, P. J., and D. E. Holbrook and N. J. Kaufman, JJ.

Opinion:
Per Curiam.
Defendant appeals by right from the entry of summary judgment for plaintiff on October 5, 1977.
Plaintiff filed a complaint for declaratory judgment on November 8, 1976, seeking a declaration of rights and obligations of the parties under a policy issued by plaintiff to defendant. The following stipulated statement of facts was agreed upon by the parties:
"This cause arises out of an automobile accident which occurred on May 10, 1975 at 9:00 p.m. in the City of Lansing at the intersection of Cedar Street and Pennsylvania Avenue. At that time and place defendant's decedent Sheila Adams was a passenger in an automobile owned and operated by John W. Chi, which was proceeding north on Pennsylvania Avenue when a pick-up truck turned left from southbound Cedar Street directly into the path of the Chi car. A collision between the to [sic] vehicles resulted in which both John W. Chi and Sheila Adams were killed.
"Subsequent investigation revealed that the pick-up truck driver was uninsured. Mr. Chi had automobile liability insurance with Allstate Insurance Company and Sheila Adams was covered for injury caused by an uninsured motorist under a policy issued by plaintiff Michigan Millers to Mrs. Adams' daughter.
"Pursuant to the provisions of the Allstate Insurance Company policy the Estate of Sheila Adams received their policy limit of $20,000. The Estate also filed a claim with Michigan Millers under the uninsured motorist provisions of their policy. The limit of liability under that provision is set at $40,000 by the terms of the. insurance contract.
"There is a provision of the Michigan Millers policy which plaintiff contends causes Michigan Millers to be liable for only the difference between the limit of liability and any amount paid by any other insurance company which in this case would total $20,000. Defendant Adams disputes the meaning and validity of the policy provision and claims to be entitled to the limit of liability of $40,000. Plaintiff Michigan Millers has in fact offered defendant $20,000 in settlement of the claim which defendant has rejected.
"It is stipulated between the parties that the damages resulting from the death of Sheila Adams when considering her employment, life expectancy and role as a mother and wife would exceed $60,000. The sole dispute in this matter is as to the validity and interpretation of the contractual provision of the insurance policy."
Resolution of this case is dependent upon the construction given to the "excess insurance" clause of the "other insurance" provision of the insured's policy.
The "other insurance" provision of the Michigan Millers policy issued to defendant's decedent's daughter provides as follows:
"Other Insurance: If the insured has other insurance against a loss to which the Liability Coverage applies or other automobile insurance affording benefits for medical expenses against a loss to which the Medical Expense Coverage applies, the company shall not be liable under this policy for a greater proportion of such loss than the applicable limit of liability under this policy for such loss bears to the total applicable limit of liability of all valid and collectible insurance against such loss; provided, however, the insurance with respect to a temporary substitute or non-owned automobile shall be excess insurance over any other valid and collectible insurance and if the insured has other excess or contingent insurance applicable to loss arising out of the use of a temporary substitute or non-owned automobile, the company shall not be liable under this policy for a greater proportion of such loss than the amount which would have been payable under this policy, had no such other insurance existed, bears to the sum of said amount and the amounts which would have been payable under each other policy applicable to such loss, had each such policy been the only policy so applicable.
"With respect to bodily injury to an insured while occupying an automobile not owned by the named insured, the insurance under the Uninsured Motorists Coverage shall apply only as excess insurance over any other similar insurance available to such insured and applicable to such automobile as primary insurance, and this insurance shall then apply only in the amount by which the limit of liability for this coverage exceeds the applicable limit of liability of such other insurance.
"Except as provided in the foregoing paragraph, if the insured has other similar insurance available to him and applicable to the accident, the damages shall be deemed not to exceed the higher of the applicable limits of liability of .this insurance and such other insurance, and the company shall not be liable for a greater proportion of any loss to which this Uninsured Motorists Coverage applies than the limit of liability hereunder bears to the sum of the applicable limits of liability of this insurance and such other insurance."
It is the second paragraph which sets forth the "excess insurance" clause:
"With respect to bodily injury to an insured while occupying an automobile not owned by the named insured, the insurance under the Uninsured Motorists Coverage shall apply only as excess insurance over any other similar insurance available to such insured and applicable to such automobile as primary insurance, and this insurance shall then apply only in the amount by which the limit of liability for this coverage exceeds the applicable limit of liability of such other insurance."
Faced with a similar factual situation, in Horr v Detroit Automobile Inter-Ins Exchange, 379 Mich 562, 566-567; 153 NW2d 655 (1967), the Supreme Court concluded:
"We find no statutory or decisional law of this State applicable in 1963 to the insurance clauses requiring our interpretation and the parties assert there were none. Consequently, our task is limited to determining the intent of the contracting parties.
" The trouble with plaintiffs reliance upon the quoted language is that its context clearly discloses that it was intended to apply only to the determination of each insurer's pro rata share of maximum combined coverage, 'the damages' referred to in both policy clauses.
"Before that determination can be made, other language identical in both policies, 'the damages shall be deemed not to exceed the higher of the applicable limits of liability of this insurance and such other insurance', must be applied to determine the maximum combined coverage of the policies. Giving this language its literal meaning compels the conclusion that the maximum combined coverage of these policies is $10,000, since that sum is the stated limit of liability in both policies."
This case does not present a "stacking" problem such as that found in, e.g., Kozak v Detroit Automobile Inter-Ins Exchange, 79 Mich App 777; 262 NW2d 904 (1977). This case does not involve a single insurer issuing multiple insurance policies. Thus, as in Horr, supra, a literal meaning may be given to the clause in question.
We hold that the "excess insurance" clause in the contested policy is clear and unambiguous in its applicability to the facts of this case; and, because of the absence of ambiguity in the "excess insurance" clause, we hold that the rights of the parties must rest on the insurance contract as written. The order of summary judgment is therefore affirmed.
We note, in passing, that defendant's argument to the effect that plaintiff should pay a greater pro rata share than Allstate is beyond the scope of this appeal. Defendant is limited to a total recovery of $40,000.
Affirmed.