Court Opinion

ID: 9521221
Source: CourtListenerOpinion
Date Created: 2023-08-07 02:00:45.120906+00
Date Added: 2024-06-11T12:45:27.308160
License: Public Domain

Taylor, J.
(dissenting). The majority exemplifies in marked degree that hard cases make bad law.1 While plaintiffs injuries are certainly tragic,2 so too is the damage done to the fabric of our law of contracts by today’s inappropriate utilization of the estoppel doctrine to allow creation of a new unbargained-for contract between the parties. I would affirm the decision of the trial court and the Court of Appeals.
The majority concedes that language in the insurance policy called for an automatic nonrenewal of the six-month insurance policy, given plaintiff’s late pay*306ments. That should end this case because estoppel cannot be utilized to create a new contract.3 Heedlessly, the majority has nevertheless plowed ahead to hold that the principle of “estoppel bars defendant from enforcing the automatic nonrenewal provision of the insurance contract.” Ante, p 295. The majority bases its estoppel holding on the wholly irrelevant but confusing background matter that the insurance company had repeatedly accepted late payments and *307continually renewed plaintiff’s policies notwithstanding those late payments.
I believe the majority errs in applying estoppel to the case at bar. In this regard, it is difficult to improve on the analysis of the United States Court of Appeals for the Sixth Circuit when faced with a similar argument:
While an insurer may be estopped from denying the existence of an insurance policy, estoppel has not been employed by Michigan courts to extend an insurance policy beyond the term provided therein and thereby, in essence, create a second contract which was not bargained for. . . . [Detrimental reliance and estoppel have not been employed to create insurance liability ad infinitum. Rather, when an insurance policy expires by its own terms it cannot be construed to remain in effect even if no notice of cancellation or expiration was given or received. [Int'l Harvester Credit Corp v Wilkie, 695 F2d 231, 235 (CA 6, 1982).[4]
Plaintiff’s insurance policy expired by its own terms six days before the automobile accident. It is improper for the majority to conclude that estoppel may be invoked to possibly create a new contract so that plaintiff may receive no-fault benefits.4
5
*308I agree with the majority that defendant mailed plaintiff the notice of nonrenewal. However, I disagree with the majority’s conclusion that estoppel may invalidate the mailed notice of nonrenewal. Ante, p 304, n 8. The notice of nonrenewal indicated that defendant would not renew its insurance contract with plaintiff, i.e., defendant would not enter into a new contract for the next six-month period, when the existing policy expired on November 27, 1991, because he had acquired too many underwriting points. It is also the case that the policy (which was to expire on November 27, 1991) was almost canceled before the appointed expiration date because of late payments. The fact that defendant accepted late payments and thereby did not cancel the existing policy before its set expiration date is unrelated to the fact that plaintiff was on notice that the policy would not be renewed when it did in fact expire. Plaintiff was put on notice that he needed to obtain a new insurance provider as of November 27, 1991. The fact that the existing policy was almost canceled even before November 27, 1991, is irrelevant to the fact that plaintiff still needed to obtain a new insurance provider once the policy expired. Sending a notice stating that the existing policy was not going to be *309canceled early because a late payment had been made could not have induced plaintiff into believing that the policy was going to be renewed after it expired. Further, as previously mentioned, plaintiff did not have a valid proof of insurance or a new policy on the date of the accident.
I would affirm.
Weaver, J., concurred with Taylor, J.

 Northern Securities Co v United States, 193 US 197, 400; 24 S Ct 436; 48 L Ed 679 (1904) (Holmes, J., dissenting) (“[gjreat cases like hard cases make bad law”). See also Galli v Kirkeby, 398 Mich 527, 538; 248 NW2d 149 (1976) (Coleman, J., dissenting) (“[t]his is a ‘hard case’ and there is a temptation to bend the law to accommodate plaintiffs”).

 The majority first tips its hand that this is a hard case when it unnecessarily mentions, not once, but twice, that plaintiff was left substantially disabled, and then also gratuitously states that plaintiff suffered serious brain injuries and lives in a long-term supervised care program, ante, pp 289-290, 292.

 16B Appleman, Insurance Law & Practice, § 9090, p 576 (“Insurance contracts cannot be created by estoppel”); Hill v Farmers’ Mut Fire Ins Co, 129 Mich 141, 143; 88 NW 392 (1901) (“Courts cannot make contracts. They can only construe them”); Ruddock v Detroit Life Ins Co, 209 Mich 638, 654-655; 177 NW 242 (1920) (estoppel may not be extended to make a new contract). The first statement from 5 Couch, Insurance, 3d, § 78:1, p 78-5, cited by the majority at ante, p 295, is irrelevant to the case at bar because the insurer’s actions were not taken “for nonpayment of premiums.” As Couch states elsewhere: “There is a clear distinction between failure to renew a policy which has or soon will cease to exist, and the cancellation or termination of an existing policy.” 2 Couch, Insurance, 3d, § 29:3, p 29-6. Couch does state that “under certain circumstances” an insurer may be estopped from asserting that the policy has expired and was not renewed. Id. at § 29:45, p 29-54. However, the only cases cited for this proposition are factually inapposite, and this explains why they are not cited by the majority. Further, this very section also states that an insured is charged with knowledge of the stated expiration date in a policy. It is undisputed that plaintiff did not have a valid proof of insurance in his car when he was injured in the automobile accident. This is because defendant never mailed plaintiff a new proof of insurance or a new policy. Indeed, at the time of the accident, plaintiff did not have any insurance in effect, and therefore he appears to have been driving in violation of MCL 500.3102(2); MSA 24.13102(2), which makes it a criminal misdemeanor for an owner or registrant to drive a vehicle without no-fault insurance. Under such circumstances, it cannot fairly be said that defendant induced plaintiff into believing that the policy was in effect at the time of the accident. I also find the majority’s reference to Unruh v Prudential Property & Casualty Ins Co, 3 F Supp 2d 1204 (D Kan, 1998), misplaced. In Unruh, the court allowed an injured party to take discovery in an effort to establish equitable estoppel. However, the insurance company had sent the driver an offer to renew his current policy and had deposited a premium check. In stark contrast, neither an offer to renew nor a premium check was sent in the case at bar.

 I find the majority’s efforts to distinguish this case from the case at bar unpersuasive. While the plaintiff’s argument in Wilkie may have been different, the Sixth Circuit’s holding can and should be applied here.

 The majority’s reliance on Mooney v Nationwide Mut Ins Co, 172 AD2d 144; 577 NYS2d 506 (1991), is misplaced. Mooney invoked estoppel to prevent an insurance company’s attempt to cancel a policy during the policy term. Such a holding is an unremarkable utilization of estoppel. However, stating that estoppel may bar an insurer from denying the existence of an existing insurance policy is a far cry from the holding of the majority today, which would allow estoppel to create a new unbargainedfor contract. I simply do not see how it can legitimately be held that acceptance of late monthly payments during the term of a six-month contract can be the basis for creating a new contract for another six-month *308term. In response to this argument, the majority facilely asserts, ante, p 300, n 5, that I have misread Mooney. This is not the case. In fact, it is the majority that fails to carefully read the case. As the Mooney court said: “[Defendant sent notice to plaintiff that due to his and his brother’s driving records, his insurance coverage would be terminated on June 2, 1988 . . . ."Id. at 146. In Mooney, the insurer was attempting to cancel a policy during its term, i.e., before the normal expiration date. The case at bar does not involve such a cancellation or an effort to terminate an existing policy before the normal expiration date. Rather, it involves the expiration of a policy because of a nonrenewal. Accordingly, Mooney is simply inapplicable.