Ottenwess v. Hawkeye Security Insurance

Allen, J.

(dissenting). As the only member of the instant panel who was not a member of the Mathis panel, I must dissent. In my opinion a common sense reading of § 3114(3) of the no-fault act and its legislative history clearly discloses that the Legislature intended to allow an employee to sue the employer’s no-fault carrier in situations where the employee was injured while occupying a vehicle owned by the employer.

In plain and simple English the statute reads:

"An employee, his spouse, or a relative of either domiciled in the same household, who suffers accidental bodily injury while an occupant of a motor vehicle owned or registered by the employer shall receive personal protection insurance benefits to which the employee is entitled from the insurer of the furnished vehicle.” MCL 500.3114(3); MSA 24.13114(3).

I disagree with the majority that the above section *303is nothing more than a priority provision. To me it clearly authorizes employee recovery of benefits. The only problem or ambiguity is the phrase "to which he is entitled”. Travelers argues that the phrase was inserted in the statute to restrict recovery to those occasions where the employee was not within the scope of his employment at the time he was injured while occupying the employer’s vehicle. To this author, such a construction of the statute fails for three reasons:

First, it is obviously an obtuse and awkward way for the Legislature to express such an intent.

Second, so construed, the employer’s liability would, for practical purposes, be restricted to accidents involving a company car used by an employee with the employer’s permission for personal reasons or where an employee wrongfully uses the company car for personal business. This occurs so infrequently that somehow it seems illogical for the Legislature to have intended the language to include so incidental a situation.

Third, the legislative history of the bill discloses a more logical explanation for the limiting language "to which he is entitled”. The no-fault bill was first introduced in the Senate on June 2, 1971, as Senate Bill 7821 and was referred to the Committee on Commerce. Section 9(1) provided that social security benefits to which the employee would be entitled because of accidental injury should be subtracted from the no-fault benefits otherwise payable for the injury. Section 18(1) stated that payment by the insurer would discharge "to the extent of the payment, the obligations of any * * * governmental agency” to the employee for "workmen’s compensation, unemployment compensation or disability benefits law *304or any similar law”.2 Section 14(3) was worded verbatim as appears in § 3114(3) quoted above, including the phrase "to which he is entitled”. Two conclusions emerge from the bill as it was first introduced. One, the Legislature clearly intended that, to the extent of the no-fault recovery actually made, workmen’s compensation benefits were permitted and if an award was received over and above the amount of compensation benefits due, the employee would also be paid such sums. In short, the Legislature intended that the employee be paid both workmen’s compensation benefits and, to the extent the no-fault recovery exceeded workmen’s compensation due, no-fault benefits. Two, the words "to which he is entitled” were intentionally used to cover the situation where social security benefits were to be deducted as mandated by § 9(1). In such a situation the injured employee would not be entitled to the entire award but instead would be entitled to the award minus social security benefits. The words "to which he was entitled” was a logical way to describe this situation.

On May 30, 1972, the Committee on Commerce reported out a substitute bill known as Senate Substitute 782.3 Section 18(1) was deleted but its *305basic provisions were added to § 9(1) which in the substitute bill was renumbered § 3109 and amended to state that all state or Federal benefits (not merely social security) should be subtracted from the no-fault benefits otherwise payable. In effect, the Commerce Committee was simplifying the original bill by placing, in a single section (§ 3109), the mandates which originally were included in two sections and by treating all government benefits, including workmen’s compensation benefits, as a deduct rather than as an obligation to indemnify. But the fact that workmen’s compensation benefits were moved from one bill section to another and were treated as deducts, in no wit detracts from the originally expressed intentions of the Legislature to allow both workmen’s compensation recovery and no-fault recovery. Obviously, in both the original bill and in the more simplified substitute bill the Legislature mandated recovery which is totally inconsistent with the exclusive remedy statute.4 Likewise, with all government benefits treated as deducts, the need for the words "to which he is entitled” became even more apparent. In my opinion, the history of the bill discloses an unambiguous intent to override any prohibitions which the exclusivity clause might make to no-fault recovery from the employer’s insurer. Additionally, the bill history reveals a more rational explanation for the words "to which he is entitled” than the explanation advanced in the majority opinion. Accordingly, I join in the *306result (though not in the reasons)5 in Hawkins v Auto Owners Ins Co, 83 Mich App 225; 268 NW2d 534 (1978).

I also disagree with the majority opinion holding that Hawkeye, the employee’s no-fault insurer, is liable for no-fault benefits under subsection 3114(4)." Deceased had just exited the cab and, while standing on or next to the truck, was in the process of repairing or examining the dump apparatus when the accident occurred. As such he was legally an occupant of his employer’s truck. Nickerson v Citizens Mutual Ins Co, 393 Mich 324, 328-330; 224 NW2d 896 (1975). The relevant statutory provisions governing recovery for injuries sustained while the person injured is an occupant of a motor vehicle appear in §§ 3114(3) and (4) of the statute. These read:

"(3) An employee, his spouse, or a relative of either domiciled in the same household, who suffers accidental bodily injury while an occupant of a motor vehicle owned or registered by the employer shall receive personal protection insurance benefits to which the employee is entitled from the insurer of the furnished vehicle.
"(4) Except as provided in subsections (1) to (3), a person suffering accidental bodily injury while an occupant of a motor vehicle shall claim personal protection insurance benefits from insurers in the following order of priority:
(a) The insurer of the owner or registrant of the vehicle occupied.
(b) The insurer of the operator of the vehicle occupied.” (Emphasis supplied.)

*307The narrow question involved is which of the two sections quoted above governs the situation in the instant case. It is my opinion that § (3) applied and § (4) does not. The italicized words eliminate the application of § (4). Section (4) cannot control because it covers cases where § (1) and § (3) are not applicable. But § (3) is applicable once one concludes, as I do, that Mathis is not controlling.6 This being so, there is no liability, not even secondary liability as to Hawkeye.7 Accordingly, I conclude that although the trial court may have assigned the wrong reasons, the grant of summary judgment in favor of defendant Hawkeye is without error.

Senate Journal 1971, Vol 1, p 1000.

"Sec. 18. (1) A personal protection insurer has the primary obligation to indemnify for the elements of loss as defined in sections 7 and 8 because of accidental bodily injury arising out of the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle. Payment by such insurer of personal protection insurance benefits with respect to such injury operates to discharge, to the extent of the payment, the obligations of any person, organization, insurer or governmental agency to indemnify against such loss under any workmen’s compensation, unemployment compensation or disability benefits law or any similar law. If the personal protection insurer fails to pay any of such benefits due under this act with respect to the injury, the person, organization, insurer or governmental agency shall have a lien, with respect to any payment it may be obligated to make, upon the obligation of the personal protection insurer, by giving prior written notice of its intention to make payment for such injury.”

Senate Journal 1972, Vol 2, p 1275.

The substitute bill was passed in the Senate without amendment June 8, 1972 (Senate Journal, Vol 2, p 1390). On September 21, 1972, the House Committee on Insurance reported out a House Substitute (House Journal, Vol 3, p 2786) which passed the House but was rejected in the Senate (Senate Journal Vol 2, p 1944). A conference committee was appointed and, on October 5, 1972, the committee reported that the House receded from its substitute and agreed to the Senate Substitute in the form it was enacted by the Senate. (Senate Journal, Vol 2 p 2005.)

The Hawkins panel distinguished Mathis on the grounds that in Mathis the employer was self-insured. I do not agree with the distinction and in this respect agree with the majority opinion in the instant case that the liabilities of self-insurers and insurers must be coextensive.

Of course, if the majority is right that plaintiff cannot recover under § (3) against Travelers because of the worker’s exclusivity provision, then the majority is correct in the conclusion expressed in the majority opinion that, as to Hawkeye, § (4)(b) establishes liability.

Had deceased been in the course of his employment and using his own car when injured, Hawkeye would be responsible and the exclusivity clause would,not have been a proper defense. See Pollock v Frankenmuth Mutual Ins Co, 79 Mich App 218; 261 NW2d 554 (1977). There, plaintiffs sued Frankenmuth Mutual for no-fault benefits for the death of their mother who was killed when a third-party vehicle collided with an automobile being operated by the mother and insured with Frankenmuth. In turn, Frankenmuth claimed that the mother’s death occurred while she was in the course of her employment with Tyrolean Hills and that workmen’s compensation benefits payable by the compensation carrier should be deducted from any no-fault recovery against Frankenmuth even though plaintiffs refused to file for workmen’s compensation benefits. (Deceased’s husband was part owner of Tyrolean Hills.) In its opinion, the Court ruled only on the constitutional issue raised, holding that compensation benefits, if paid, could not be deducted. Implicit, however, in the opinion was an assumption that no-fault benefits could be collected on a private insurance contract even though deceased was killed while employed and would be entitled to workmen’s compensation.