Case Name: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v. SHELLY
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1975-07-23
Citations: 394 Mich. 448
Docket Number: Docket No. 56846
Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v SHELLY
Judges: T. G. Kavanagh, C. J., and Williams, Levin, M. S. Coleman, J. W. Fitzgerald, and Lindemer, JJ., concurred.
Reporter: Michigan Reports
Volume: 394
Pages: 448–450

Head Matter:
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v SHELLY
Docket No. 56846.
Decided July 23, 1975.
State Farm Mutual Automobile Insurance Company brought an action for declaratory judgment regarding coverage under an automobile insurance policy against Harold F. Shelly, Jr., Andrea C. Thomas, Joseph H. Hawley, administrator of the estate of Dorothy Hawley, deceased, and Andrea L. Thomas, personally and as administratrix of the estate of Lynn Thomas, deceased. The Oakland Circuit Court, John N. O’Brien, J., held that a clause of the policy excluding coverage when Harold F. Shelly, Jr., was driving was invalid, but that policy coverage as to him was the statutory minimum, $10,000/$20,000, rather than the policy limit, $25,000/$50,000. The Court of Appeals, Allen, P. J., and T. M. Burns and R. M. Maher, JJ., reversed in part, holding that coverage as to Harold F. Shelly, Jr., was the policy limit. Plaintiff applies for leave to appeal. Leave is granted, and the Court sua sponte reverses that portion of the Court of Appeals opinion relating to coverage to the policy limit. Held:
The motor vehicle responsibility law provides that the term "motor vehicle liability policy” applies only to that part of the coverage which is required by the law. The Motor Vehicle Accident Claims Act provides that a vehicle is uninsured if it does not meet the requirements of the responsibility law, and where an exclusionary clause is void because it is against the policy of the accident claims act, the reinstated coverage is limited to the amount required so that the vehicle is not uninsured within the meaning of the accident claims act.
59 Mich App 491; 229 NW2d 820 (1975) reversed in part.
Draugelis, Ashton & Scully for plaintiff.

Opinion:
Memorandum Opinion. On order of the Court, plaintiff-appellant's application for leave to appeal is considered and the same is hereby granted.
The Court, sua sponte, pursuant to GCR 1963, 865.1(7), hereby reverses that portion of the decision of the Court of Appeals relating to the extent of the insurance company's liability where an exclusionary clause in a policy of motor vehicle liability insurance is void because it is against the policy of the Motor Vehicle Accident Claims Act (MV ACA).
Under the MV AC A, a motor vehicle could be registered as an insured vehicle on the strength of a certificate of insurance certifying that a policy of insurance had been issued covering the vehicle in compliance with the MV ACA. Exclusions which purported to limit coverage below that required so that the vehicle would not be an "uninsured motor vehicle" within the meaning of the MVAC A were invalid.
The question is whether the insurance company's liability as to the reinstated coverage is limited to the amount required by the statute or extends to the full, and greater, amount set forth in the policy.
We have considered decision in other jurisdictions and the opinion of the Court of Appeals reported at 59 Mich App 491 holding that coverage extends to the greater amount.
The MVAC A provides that a motor vehicle is uninsured if it does not meet the requirements of the motor vehicle responsibility law, MCLA 257.501, et seq.; MSA 9.2201, et seq., which provides in part that "with respect to a policy which grants such excess or additional coverage the term 'motor vehicle liability policy' shall apply only to that part of the coverage which is required by this section". MCLA 257.520(g); MSA 9.2220(g).
We are persuaded that where an exclusionary clause is void as against the policy of the MVAC A, reinstated coverage is limited to the amount re quired so that the vehicle is not an uninsured motor vehicle within the meaning of the MV ACA.
T. G. Kavanagh, C. J., and Williams, Levin, M. S. Coleman, J. W. Fitzgerald, and Lindemer, JJ., concurred.
Swainson, J., took no part in the decision of this case.