source: Caselaw Access Project

author: Per Curiam.

license: Public Domain

text:
    PEOPLE v CASH
    1. Criminal Law — Impeachment—Prior Convictions — Probative Value — Credibility of Defendant.
    A defendant may not be impeached by reference to prior felony convictions carte blanche; instead, the trial court must weigh the prejudicial impact on the jury of reference to a prior felony conviction against its probative value to the issue of credibility.
    2. Criminal Law — Impeachment—Prior Convictions — Admissibility.
    A criminal defendant may be impeached, under proper circumstances, by reference to any prior felony conviction; however, prior convictions which are for the same crime should be admitted with extreme caution; the more similar the prior conviction is to the offense for which the accused is being tried, the more hesitant should be the trial judge in allowing its admission.
    3. Criminal Law — Impeachment—Prior Convictions — Similar Crimes — Not Barred Per Se.
    Impeachment of a defendant by reference to a prior conviction of a crime similar to the crime charged is not barred per se.
    4. Criminal Law — Impeachment—Prior Convictions — Jury.
    A jury is not put in the objectionable position of thinking "if he did it before, he probably did so this time” where, on the record, although there may be impeachment by reference to a prior conviction for another type of crime, there was no impeachment of the defendant by reference to a prior conviction for a similar crime.
    References for Points in Headnotes
    [1, 4] 81 Am Jur 2d, Witnesses §§ 571, 572, 582.
    [2, 3] 81 Am Jur 2d, Witnesses §§ 582, 594.
    [5] 81 Am Jur 2d, Witnesses § 577.
    [6] 5 Am Jur 2d, Appeal and Error § 809.
    81 Am Jur 2d, Witnesses § 509.
    [7] 75 Am Jur 2d, Trial § 877.
    [8] 5 Am Jur 2d, Appeal and Error § 974.

      5. Criminal Law — Prior Convictions — Instructions to Jury — Evidence — Credibility—Appeal and Error.
    A defendant’s conviction should not be reversed because there were references to prior criminal convictions at trial where the trial court instructed the jury that the evidence of a prior criminal conviction could not be considered as evidence of guilt of the crime charged but only could be considered insofar as it affected the defendant’s credibility.
    6. Appeal and Error — Criminal Law — Trial—Cross-Examination —Failure to Object.
    Failure to object at trial to a prosecutor’s lengthy cross-examination into the nature of a defendant’s prior felony conviction, as a general rule, will preclude appellate review.
    7. Criminal Law — Lesser Included Offenses — Instructions to Jury — Requests for Instructions.
    Except in first-degree murder cases, failure to instruct the jury on lesser included offenses is not error in the absence of a request to so charge.
    8. Appeal and Error — Criminal Law — Sentences—Prior Convictions — Trial Court Consideration.
    The Court of Appeals may refrain from considering a claim that a sentence might have been different if the sentencing judge had known that a defendant’s previous convictions had been unconstitutionally obtained until the matter is first presented to the trial court.
    Appeal from Washtenaw, Patrick J. Conlin, J.
    Submitted December 7, 1977, at Lansing.
    (Docket No. 28996.)
    Decided January 5, 1978.
    Billy Cash was convicted of first-degree criminal sexual conduct. Defendant appeals.
    Affirmed.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William F. Delhey, Prosecuting Attorney, and John J. Hensel, Senior Assistant Prosecuting Attorney, for the people.

      Hendley & Datsko, P. C., for defendant on appeal.

      Before: R. B. Burns, P. J., and Allen and R. M. Maher, JJ.
   Per Curiam.

Defendant was charged with first-degree criminal sexual conduct, MCLA 750.520b(l); MSA 28.788(2X1), for allegedly forcing the complaining witness at knifepoint to engage in sexual intercourse with him. Following a three-day trial by jury he was found guilty as charged and, on May 13, 1976, was sentenced to a term of 15 to 30 years in prison. He appeals of right asserting four grounds for reversal or remand for resentencing.

The principal ground relied upon for reversal is that the trial court abused its discretion in allowing the prosecutor to impeach the defendant by use of a prior felony conviction for assault with intent to rape. At trial, defendant admitted the intercourse but testified that it was by mutual consent. He further testified that the knife was procured for him by the complaining witness so that he might cut some string to tie a blanket that was in his car. In what was obviously to be a one-on-one confrontation at trial as to whether the complaining witness or the defendant was telling the truth, defense counsel requested a protective order to exclude all references to five prior felony convictions during trial. Four of the prior convictions were for burglary. The trial court ruled that the prosecutor could not use the prior convictions for burglary but that the prior conviction for assault with intent to rape could be used.

A defendant may not be impeached by reference to prior felony convictions carte blanche. Instead, the court must weigh the prejudicial impact on the jury of reference to a prior felony conviction against its probative value to the issue of credibility. People v Farrar, 36 Mich App 294, 301-303; 193 NW2d 363 (1971); Gordon v United States, 127 US App DC 343; 383 F2d 936 (1967); People v Jackson, 391 Mich 323, 325; 217 NW2d 22 (1974). But contrary to defendant’s contention that impeachment by prior conviction must be limited to crimes directly related to credibility, viz: fraud, embezzlement, perjury, false pretenses, impeachment may, under proper circumstances, be based upon any prior felony conviction. People v Payne, 27 Mich App 133, 134; 183 NW2d 371 (1970), People v Cantrell, 27 Mich App 210, 213; 183 NW2d 401 (1970). However, prior convictions which are for the same crime should be admitted with extreme caution. The more similar the prior conviction is to the offense for which the accused is being tried, the more hesitant should be the trial judge in allowing its admission. As the Chief Justice, then Judge Burger, said in Gordon, supra:

"A special and even more difficult problem arises when the prior conviction is for the same or substantially the same conduct for which the accused is on trial. Where multiple convictions of various kinds can be shown, strong reasons arise for excluding those which are for the same crime because of the inevitable pressure on lay jurors to believe that 'if he did it before he probably did so this time’. As a general guide, those convictions which are for the same crime should be admitted sparingly; one solution might well be that discretion be exercised to limit the impeachment by way of a similar crime to a single conviction and then only when the circumstances indicate strong reasons for disclosure, and where the conviction directly relates to veracity.” (Footnote omitted.) Gordon, supra, at 347; 383 F2d at 940.

Unfortunately, the trial court in the instant case, though properly recognizing that it had discretion in the matter, appears to have exercised that discretion upside down in admitting the prior conviction because it was similar to the offense for which the defendant was charged.

Nevertheless, we do not find error. First, even Gordon, supra, does not per se bar every impeachment by a prior similar conviction. In People v Townsend, 60 Mich App 204, 206; 230 NW2d 378 (1975), this Court allowed impeachment of a defendant on trial for breaking and entering an occupied dwelling with convictions of two crimes of the same kind. As stated by the Court:

"While it is true the offenses were similar to the one for which defendant was on trial, this alone does not require their exclusion. We find no error.” Townsend, supra, at 206.

Second, and more importantly for disposition of this cause, defendant was not impeached by a prior conviction of assault with intent to rape. Instead, defendant was impeached on cross-examination by his own admission to pleading guilty to an assault (by shooting) on a girl in the front seat of his automobile. Defendant denied that he pled guilty to a sexual assault and explained that the shooting was accidental. When the prosecution then sought to call a detective for the purpose of testifying that defendant had told him he had pled guilty to assault with intent to rape, the trial court sustained defense counsel’s objection that a defendant could not be impeached on a collateral matter. The witness was never called and the matter was dropped. Thus, on the record there was no impeachment by a prior sexual assault. The jury was never put in the position found so objectionable in Gordon, supra, that "if he did it before, he probably did so this time”. Third, in instructing the jury, the trial court charged that the evidence of a prior criminal conviction could not be considered by the jury as evidence of guilt of the crime charged but only could be considered insofar as it affected the defendant’s credibility.

Defendant’s remaining claims of error are of less importance and are rejected on sound grounds. No objection was made to the prosecutor’s cross-examination of defendant on this question of the nature of the prior conviction and when objection was finally made it was sustained. People v Council, 36 Mich App 682, 686; 194 NW2d 34 (1971), is distinguishable since there the cross-examination extended beyond the prior offense and, by reference, sought to bring in an FBI report. Except in first-degree murder cases, failure to charge on lesser included offenses is not error in the absence of a request to so charge. People v Henry, 395 Mich 367, 374; 236 NW2d 489 (1975), People v Combs, 69 Mich App 711, 717; 245 NW2d 338 (1976). The sentencing transcript suggests the trial court did not consider the prior Georgia conviction in imposing sentence; but assuming arguendo, that the court did so consider it, defendant has failed to follow the post-sentencing relief procedure mandated for a Tucker-type hearing. In People v Moore, 391 Mich 426; 216 NW2d 770 (1974), the Supreme Court held that the Court of Appeals may refrain from considering a Tucker claim until the matter is first presented to the trial court. Defendant has not followed that procedure.

Affirmed.

       "THE COURT: * * * I certainly wouldn’t admit evidence of a narcotics conviction or a marijuana conviction. But here we have a case of assault with intent to rape, and he was convicted of another charge of assault with intent to rape. Any charge that this man is convicted of wherein there is an assault involved, I will allow the prosecutor to go into it because it is my feeling that the triers of fact, the jury, are entitled to decide whom to believe. In this case we have the complaining witness and the defendant testifying, and the triers of fact are entitled to know that he has been convicted of another assaultive type of crime, in that case being an identical situation, assault with intent to rape. The trier of fact is entitled to know that before they make their decision. Regarding the other cases of burglary, I do not feel that that has any particular bearing on the charge of rape.”

       In the past, this panel has noted several instances when trial courts and counsel have similarly misinterpreted Farrar and Jackson and Gordon. See also People v Osteen, 46 Mich App 409, 419-20; 208 NW2d 198 (1973), dismissed as moot, 390 Mich 760 (1973), wherein this Court seems to have made a similar mistake. We believe that the confusion is traceable to prior contrary Michigan law — see People v Simard, 314 Mich 624; 23 NW2d 106 (1946) — and to the manner in which Gordon was paraphrased in Farrar and Jackson. The original opinion in Gordon should be consulted for clarification.

       (1) It was error for the prosecutor to cross-examine at length into the nature of the prior felony conviction.
      (2) It was error for the trial court to omit to instruct on the lesser included offense of criminal sexual conduct in the second degree.
      (3) It was error for the sentencing court to consider a conviction for which the defendant was not represented by counsel and was indigent.

        United States v Tucker, 404 US 443; 92 S Ct 589; 30 L Ed 2d 592 (1972).


text:
    SMITH v CITY OF FLINT SCHOOL DISTRICT
    1. Release — Master and Servant — Torts—Tort Liability — Respondeat Superior.
    The release of a servant operates to release a master liable solely under the doctrine of respondeat superior; the rationale for this rule is that the employer is not guilty of a tortious act, he did not participate.in the commission of a tort, and liability arises only by operation of law.
    2. Release — Master and Servant — Release of Employee — Employee-Employer Relationship — Release of Employer.
    The rule that an employer is released when an employee is released is a general rule which applies regardless of whether the employee-employer relationship is known; a lack of knowledge or the fact that a plaintiff might not have understood the legal effect of the release does not abrogate it.
    3. Release — Equity—Reformation of Releases.
    The Court of Appeals may in equity release a party from the legal effect of a release for damages resulting from an accident where the parties could not know that a cause of action would lie, there were new or additional compensable claims, or unforeseen serious injuries developed after signing the release.
    4. Release — Master and Servant — Employee-Employer Relationship — Release of Employee — Suit Against Employer.
    An injured party’s release of an employee bars suit against the employer where the releasor knew, should have known, or could have discovered the employee-employer relationship at the time of signing the release.

      References for Points in Headnotes
    [1] 53 Am Jur 2d, Master and Servant § 408.
    [1-4] Release of (or covenant not to sue) master or principal as affecting liability of servant or agent for tort, or vice versa. 92 ALR2d 533.
    [2] 53 Am Jur 2d, Master and Servant § 411.
    [3] 66 Am Jur 2d, Release § 55.
    Extent or nature of injuries, avoidance of release of personal injury claims on ground of fraud or mistake as to. 71 ALR2d 82.
    [4] 53 Am Jur 2d, Master and Servant § 406.

      Appeal from Genesee, Philip C. Elliott and Earl E. Borradaile, JJ.
    Submitted November 2, 1977, at Lansing.
    (Docket No. 28593.)
    Decided January 5, 1978.
    Complaint by Emma J. Smith and James F. Smith against the City of Flint School District, the Flint Board of Education and Dennis Borton, Francis Borton and James Borton for damages resulting from an automobile accident. Motion for summary judgment by defendants school district and board of education denied. Motion for rehearing denied. Defendants school district and board of education appeal by leave granted.
    Reversed and remanded.

      Hal W. Ziegler, for plaintiffs.

      Smith & Brooker, P. C. (by Lawrence E. Nill), for defendants.
    Before: J. H. Gillis, P. J., and Bashara and H. L. Heading, JJ.

       Detroit Recorder’s Court judge, sitting on the Court of Appeals by assignment.

   Per Curiam.

Plaintiffs commenced this action in Genesee County Circuit Court seeking damages resulting from an automobile accident alleged to have occurred between plaintiff, Emma Jean Smith, and Dennis Borton, an employee of one of the defendants, City of Flint School District.

Plaintiffs’ complaint stated that Dennis Borton, at the time of the accident, was under the employ and control of the defendants, and, accordingly, they should be held responsible for his negligent acts. This employ consisted of work within a skill and vocational program operated and controlled by defendants for which Borton received compensation.

Defendants, in a motion for summary judgment, asserted that plaintiffs’ release in favor of Dennis Borton and his parents barred the action. Plaintiffs responded that the release was not effective against defendants because they were unaware of the employee-employer relationship at the time the release was signed.

The release discharged Dennis Borton and James Borton and

"[T]heir executors, administrators, and all persons or organizations responsible for his/their acts from all claims and causes of action for all injuries, losses, and damages sustained * * * arising from an incident all or part of which occurred on or about the 17th day of April, 1972, at or near Perry Road near Vassar Road, County of Genesee, State of Michigan.”

The trial court denied defendants’ motion for summary judgment. However, it certified that its order involved a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate determination of the litigation.

Michigan courts have consistently held that a release of a servant operates to release a master liable solely under the doctrine of respondeat superior. Geib v Slater, 320 Mich 316; 31 NW2d 65 (1948), Witucke v Presque Isle Bank, 68 Mich App 599; 243 NW2d 907 (1976), lv den, 397 Mich 842 (1976), Drinkard v William J Pulte, Inc, 48 Mich App 67; 210 NW2d 137 (1973). The rationale for this rule is that the employer is not guilty of a tortious act, he did not participate in the commission of a tort, and liability arises only by operation of law. Geib v Slater, supra.

"One view expressed is that because the basis of liability on the theory of respondeat superior is that the master is liable only for the act of his servant, and not for anything he himself did, therefore, when the servant is not liable, the master for whom he was acting at the time should not be liable.” 53 Am Jur 2d, Master and Servant, § 408, p 416.

Although the question at bar has not been considered by Michigan courts, there is no reason to determine that plaintiffs’ lack of knowledge should change the outcome required by the general rule. The fact that the plaintiffs might not have understood the legal effect of the release does not abrogate it. Malone v SCM Corp, 63 Mich App 11; 233 NW2d 872 (1975). Furthermore, the rationale behind releasing an employer when the employee is released applies regardless of whether the employee-employer relationship is known.

The question remains whether this Court in equity should relieve plaintiffs from the legal effect of their release. In Chuby v General Motors Corp, 69 Mich App 563; 245 NW2d 134 (1976), this Court struck down a general release which it found was not "fairly and knowingly” made. At the time the release was executed Michigan law apparently held that no liability existed for loss of society and companionship because of the wrongful death of plaintiffs son. However, a later case, which made its holding retroactive, held that such a cause of action did lie. Smith v Detroit, 388 Mich 637; 202 NW2d 300 (1972). This Court struck down the Chuby release because "the parties had no way of knowing” that the cause of action would lie and because the release was also apparently executed under the mistaken assumption that the decedent had experienced no pain and suffering.

Chuby is distinguishable from the instant case in two respects. First, in Chuby the parties could not know that the cause of action would lie; in the instant case, the employee-employer relationship could have been discovered. Second, in Chuby the mistakes resulted in two additional compensable claims; in the instant case, there is no indication that plaintiffs are alleging new claims. Other cases dealing with reformation of releases concern plaintiffs who develop unforeseen serious injuries after signing the release. See, e.g., Denton v Utley, 350 Mich 332; 86 NW2d 537 (1957). The Denton Court set forth the "fair and knowing” test. Plaintiffs’ allegation of mistake goes to the "knowing” prong. On this issue there is a distinction between the unforeseen injury cases and the unknown defendant case. The former cannot be discovered and the latter can. Therefore, the reasonable approach would be to consider what the releasor knew or should have known at the time of the signing of the release. In this case, plaintiffs could have discovered the relationship, therefore the instant suit should be barred by the release.

The trial court’s denial of defendants’ motion for summary judgment is reversed and the case is remanded for further proceedings not inconsistent with this opinion. Costs to defendants.


text:
    RUSSELL v OGILVIE
    1. Statutes — Dead Man’s Statute — Strict Construction.
    Michigan’s courts have, by strict construction, shown no disposition to extend the scope of the dead man’s statute (MCLA 600.2166; MSA 27A.2166).
    2. Witnesses — Dead Man’s Statute — Death—Incompetency—Amnesia — Statutes.
    It is not necessary for a person to be adjudged mentally incompetent or insane in order to invoke the dead man’s statute, but the person incapable of testifying must still be incapable by reason of death or incompetency; therefore, a plaintiff with retrograde amnesia, who is unable to recall events shortly before and after the accident for which he is seeking damages, is not incapable of testifying and thus is not incompetent as the term is used in the context of the statute; to include an amnesiac within the coverage of the statute runs counter to the express policy in this state of not expanding the scope of the dead man’s statute (MCLA 600.2166; MSA 27A.2166).
    3. Appeal and Error — Negligence—Questions of Fact — Jury Questions— Inferences — Contributory Negligence.
    Questions of fact regarding a plaintiffs contributory negligence were properly presented to the jury in an action for damages for injuries sustained in an automobile accident where the defendant introduced sufficient evidence from which the jury might infer contributory negligence.
    4. Appeal and Error — Jury Verdict — Miscarriage or Justice.
    The Court of Appeals will not substitute its judgment for that of a jury unless a careful review of the record reveals a miscarriage of justice.
    References for Points in Headnotes
    [1, 2] 81 Am Jur 2d, Witnesses §§ 305, 316.
    [2] 81 Am Jur 2d, Witnesses §§ 340-343.
    [3] 5 Am Jur 2d, Appeal and Error § 834.
    [4] 5 Am Jur 2d, Appeal and Error §§ 702, 726.
    Appeal from Manistee, Charles A. Wickens, J.

      Submitted November 3, 1977, at Grand Rapids.
    (Docket No. 29688.)
    Decided January 5, 1978.
    Complaint by Dennis Russell against Scott Ogilvie and Doris Ogilvie to recover damages for injuries resulting from an automobile accident. Judgment for defendants. Plaintiff appeals.
    Affirmed.

      Jennings & DeVries, for plaintiff.

      Rhoades, McKee & Boer (by Michael W. Betz), for defendants.
    Before: R. M. Maher, P. J., and M. F. Cavanagh and N. J. Kaufman, JJ.
   Per Curiam.

Plaintiff brought an action to recover for injuries he suffered when the car in which he was a passenger left the road and struck a tree in the early morning hours of July 12, 1971. The automobile was owned by defendant Doris Ogilvie and driven by her son, defendant Scott Ogilvie. The jury returned a verdict of no cause of action. Plaintiffs motion for a new trial was denied and he appeals as of right.

The trial court erred, plaintiff charges, in permitting the defendant to testify to the events immediately preceding the accident. Plaintiff testified that he had no recollection of the events during the time from 3 to 4 days before the accident to several days afterwards. His physician testified that plaintiff suffered from retrograde amnesia, a loss of memory affecting a period immediately prior to a precipitating cause. Consequently, defendant’s testimony, charging plaintiff with contributory negligence, was the only evidence of events leading up to the accident.

Plaintiff objected to the admission of such testimony on the basis of the dead man’s statute; that is, plaintiff claims that inasmuch as he was incapable of testifying within the meaning of the dead man’s statute, defendant should not have been allowed to testify to events of which plaintiff had no memory.

The much criticized dead man’s statute, MCLA 600.2166; MSA 27A.2166 provides in part:

"(1) In an action by or against a person incapable of testifying, a party’s own testimony shall not be admissible as to any matter which, if true, must have been equally within the knowledge of the person incapable of testifying, unless some material portion of his testimony is supported by some other material evidence tending to corroborate his claim.
"(2) A 'person incapable of testifying’ includes an individual who is incapable of testifying by reason of death or incompetency * * * .”

Courts, recognizing that the statute impedes the fact finding process, have questioned whether the statute has caused more injustice than it prevents. Fojtik v Lawson, 303 Mich 568; 6 NW2d 895 (1942), Smilay v Sage, 304 Mich 514; 8 NW2d 158 (1943) , In re Potter Estate, 351 Mich 326, 331; 88 NW2d 452 (1958), and commentaries cited therein. In Michigan, as a result of such criticism, courts have, by strict construction, shown no disposition to extend the scope of the statute. Mallery v Van Hoeven, 332 Mich 561, 566; 52 NW2d 341 (1952).

Plaintiff would nevertheless have us extend the scope of the statute to one suffering from retrograde amnesia. He argues that because it is not necessary, as formerly it was, for a person to be adjudged mentally incompetent or insane in order to invoke the statute, it can be enlarged to include one in plaintiff’s situation.

While it is true that there no longer need be a judicial determination of incompetence, the person incapable of testifying must still be incapable by reason of death or incompetency. The plaintiff in this case was not incompetent as the term is used in the context of the statute. Indeed, plaintiff was not incapable of testifying at all. He was merely unable to recall events shortly before and after the accident. That is not the type of incapability envisioned by the statute. Cf. Sturman v Johnson, 209 Va 227; 163 SE2d 170 (1968). To include an amnesiac within the coverage of the statute runs counter to the express policy in this state of not expanding the scope of the dead man’s statute.

Another panel of this Court has rightly refused to extend the dead man’s statute to include one suffering from traumatic amnesia. The Court noted the policy against extending the statute beyond its original meaning and advanced another valid reason for adhering to a strict interpretation in the circumstances.

"Foreseeably, the rule for which plaintiffs contend would encourage future plaintiffs, particularly plaintiffs whose claims would otherwise be vitiated by the taint of contributory negligence, to feign convenient loss of memory.” Howell v King, 77 Mich App 272, 277; 258 NW2d 200 (1977).

The trial court’s refusal to extend the dead man’s statute to one suffering retrograde amnesia is entirely consonant with the express policy of our courts.

Plaintiff also claims the trial court erred in submitting the issue of contributory negligence to the jury. There was no error. Defendant introduced sufficient evidence from which a jury might infer contributory negligence. It was not only proper but necessary that this question of fact be submitted to the jury. Jaworski v Great Scott Supermarkets, 71 Mich App 235; 247 NW2d 363 (1976).

Nor was the jury’s verdict against the great weight of the evidence, as is contended:

"This Court will not substitute its judgment for that of the jury unless a careful review of the record reveals a miscarriage of justice. Williams v Fiedlar, 22 Mich App 179; 177 NW2d 461 (1970), aff'd 386 Mich 221; 191 NW2d 52 (1971).” Durbin v K-K-M Corp, 54 Mich App 38, 58; 220 NW2d 110 (1974).

In view of the evidence presented at trial both as to defendant’s negligence and plaintiffs contributory negligence, we cannot say that a miscarriage of justice occurred.

Affirmed.

       Subsection 4 of the statute provides that if the deposition or testimony of a person is taken "in his lifetime or when he is mentally sound,” that testimony may be used in any subsequent litigation and the bar upon testimony is completely lifted. Clearly, then, the incapability referred to in subsection 2 of the act denotes death or mental unsoundness and nothing more. (Emphasis added.)


author: Per Curiam. N. J. Kaufman, J.

text:
    SCHIGUR v WEST BEND MUTUAL INSURANCE COMPANY
    Opinion op the Court
    1. Automobiles — Insurance—Uninsured Motorists — Set-Off Provision.
    The reduction of an insurer’s liability under uninsured motorist coverage by the amount of whatever payments the insurer makes under personal protection coverage is proper where a provision of an automobile insurance policy clearly authorizes such a reduction.
    2. Insurance — Statutorily Required Provisions — Constitutional Law — Due Process — Equal Protection.
    Provisions of an insurance policy that are not statutorily required do not implicate constitutional guarantees of due process and equal protection.
    Dissent by N. J. Kaufman, J.
    3. Insurance — Contracts—Enforceability—Considerations of Equity — Public Policy.

      An insurance contract is enforceable unless considerations of equity and justice or of public policy dictate otherwise.

    4. Automobiles — Insurance—Uninsured Motorists — Set-Off Provision.

      An automobile insurance policy provision which authorizes a reduction in uninsured motorist coverage beneñts by the amount paid by the insurer under personal protection coverage should not be enforced where the set-off provision is inequitable and unjust and its implementation leads to an unconscionable result; the present statutory scheme which allows such set-offs does not permit all victims to be made whole.

    References for Points in Headnotes
    [1, 4] 7 Am Jur 2d, Automobile Insurance §§ 135-138.
    20 Am Jur 2d, Counterclaim, Recoupment and Setoff § 2.
    [2] 43 Am Jur 2d, Insurance §§ 147, 271, 276.
    [3] 43 Am Jur 2d, Insurance §§ 241-245.
    44 Am Jur 2d, Insurance § 1900.

      Appeal from Wayne, Richard D. Dunn, J.
    Submitted June 14, 1977, at Detroit.
    (Docket No. 31545.)
    Decided January 5, 1978.
    Leave to appeal applied for.
    Complaint by Melvin D. Schigur against West Bend Mutual Insurance Company for payment under an uninsured motorist provision of an insurance policy for damages for personal injuries suffered by plaintiff when struck by a hit and run driver. Judgment for plaintiff. Defendant appeals.
    Reversed and remanded.

      Moore, Barr & Kerwin, for plaintiff.

      Morbach, Cheatham & MacArthur, for defendant.
    Before: R. M. Maher, P. J., and N. J. Kaufman and F. J. Borchard, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   Per Curiam.

Plaintiff, while a pedestrian, was struck by an unidentified hit and run driver on May 18, 1975. He was unsuccessful in an attempt to recover damages for pain and suffering from the Motor Vehicle Accident Claims Fund, MCLA 257.1101 et seq.; MSA 9.2801 et seq. Schigur v Secretary of State, 73 Mich App 239; 251 NW2d 567 (1977). The present action is against defendant, insurer of plaintiff’s Volkswagen, for recovery under uninsured motorist coverage.

The "Family Combination Automobile Policy” plaintiff purchased from defendant included, for a $2 annual premium, $20,000-$40,000 uninsured motorist coverage. Section II of the policy stated:

"In consideration of the insurance afforded under Section 1 of this endorsement [no-fault personal protection coverage] and the adjustment of applicable rates, any amount payable under the Protection Against Uninsured Motorists Coverage shall be reduced by the amount of any personal protection benefits paid or payable under this or any other automobile insurance policy because of bodily injury to an eligible injured person.”

Plaintiff sought arbitration of defendant’s liability under the uninsured motorist coverage of the policy. The arbitrator found plaintiff entitled to $20,000, specifying also that the award did not include medical payments and wage loss. The court below rejected defendant’s claim that any amounts paid as personal protection benefits under the policy could be offset against the arbitrator’s award. Somehow, the court thought that to allow the insurer to offset benefits paid for economic losses against an award for noneconomic losses would violate both due process and equal protection. Defendant appeals the judgment below.

We have recently considered, in American Fidelity Fire Insurance Co v Williams, 80 Mich App 125; 263 NW2d 311 (1977), the question presented by this appeal. We held that, as authorized by the policy, an insurer could offset against its liability under uninsured motorist coverage any personal protection benefits it paid. None of plaintiff’s arguments convince us to decide the present case differently.

As did the insured in Williams, plaintiff points to Michigan Mutual Liability Co v Karsten, 13 Mich App 46; 163 NW2d 670 (1968), and Michigan Mutual Liability Co v Mesner, 2 Mich App 350; 139 NW2d 913 (1966), as support for his argument against offset. His argument based upon the two cases is no more persuasive than the one rejected in Williams.

Plaintiff also argues that Murray v Ferris, 74 Mich App 91; 253 NW2d 365 (1977), supports the trial court’s decision. Murray found that MCLA 500.3116; MSA 24.13116 clearly required that an insured who receives personal protection benefits must repay his insurer from any tort recovery he realizes. Murray then held that this statute violated both due process and equal protection.

Provisions of an insurance policy that are not statutorily required do not implicate constitutional guarantees of due process and equal protection. Nevertheless, the similarity between the insurance provision involved here and MCLA 500.3116; MSA 24.13116 indicates that Murray may support plaintiffs position. Both the offset provision in the policy and MCLA 500.3116; MSA 24.13116 must be read with MCLA 500.3135; MSA 24.13135 in mind. MCLA 500.3135; MSA 24.13135 severely restricts the ability of a person, injured in a motor vehicle mishap, to maintain an action in tort. Only if there has been death, serious impairment of body function or permanent serious disfigurement does a person remain subject to tort liability for noneconomic loss caused by his ownership, maintenance or use of a motor vehicle. MCLA 500.3135(1); MSA 24.13135(1). Whether or not the person causing the accident is insured, the threshold for liability for noneconomic loss must be met. While an insured motorist is only liable for negligently caused economic loss that is in excess of personal protection benefits payable, MCLA 500.3135(2)(c); MSA 24.13135(2)(c), an uninsured motorist is given no immunity from tort liability for economic loss. Of course, the ability of a person injured in another jurisdiction to invoke the laws of that jurisdiction have not been affected.

When a tort recovery is made, under these restrictions upon liability, MCLA 500.3116; MSA 24.13116 gives an insurer who has paid personal protection benefits a right to reimbursement from the recovery. As Murray observed, an insurer who has paid an insured only for economic losses may, under this section, be reimbursed from the insured tort recovery for noneconomic losses.

In Pelkey v Elsea Realty & Investment Co, 394 Mich 485; 232 NW2d 154 (1975), the Supreme Court found nothing objectionable with a workmen’s compensation carrier’s ability to offset an injured employee’s recovery for pain and suffering against the carrier’s liability for medical treatment. The employee had argued that permitting the carrier to credit a pain and suffering recovery from a third-party tortfeasor against the amount of compensation owed violated equal protection and due process. The Court quickly rejected this argument.

Although Murray attempted to distinguish Pelkey, the distinction offered was not a substantial one. In view of Pelkey, the holding in Murray is questionable. Certainly, the questionable constitutional analysis of MCLA 500.3116; MSA 24.13116 in Murray is no reason to disregard the plain language of contractual provision now before this Court. To the contrary, the policy provision is not inconsistent with the approach chosen by the Legislature for compensation of automobile accident victims.

Reversed and remanded.

N. J. Kaufman, J.

(dissenting). The majority opinion allows defendant-insurer to set-off benefits paid to an insured injured by an uninsured motorist for economic damage from an award for noneconomic damage. I acknowledge that a clause contained in the uninsured motorist provision of the insurance contract authorizes such a set-off. I further acknowledge that the contract is enforceable unless considerations of equity and justice or of public policy dictate otherwise. Kozak v Detroit Automobile Inter-Insurance Exchange, 79 Mich App 777; 262 NW2d 904 (1977). However, I believe that considerations of equity and justice mandate that the insurance policy be enforced without the set-off provision. Accordingly, I dissent.

I believe that the resolution of this case is aided by an examination of Murray v Ferris, 74 Mich App 91; 253 NW2d 365 (1977). In that case, this Court held that considerations of due process and equal protection prevented a statute from requiring an injured party to reimburse his insurer for benefits paid for economic losses from a recovery for noneconomic losses. In response, the majority argues that "[provisions of an insurance policy that are not statutorily required do not implicate constitutional guarantees of due process and equal protection”. Without passing on the majority’s argument, I nevertheless maintain that Murray’s rationale comports with the standard set forth by this same majority in Kozak v DAIIE, supra.

The threshold of my argument is grounded in the simple, and undisputed, maxims regarding the rationale for recovery of damages under no-fault insurance:

"The function of recovery in tort is to make the victim whole. Because of court congestion and delays in settlements and trials, many tort victims suffer undue hardships. In adopting the no-fault personal injury protection provision, the Legislature sought to afford the insured with the security of a prompt and certain recovery of a fixed amount over a fixed time for his out-of-pocket expenses, i.e., medical expenses, lost wages and lost services.” 74 Mich App at 95.

The present statutory scheme does not permit all victims to be made whole. The particular provision of the no-fault act under consideration is MCLA 500.3135; MSA 24.13135:

"Sec. 3135. (1) A person remains subject to tort liability for noneconomic loss caused by his ownership, maintenance or use of a motor vehicle only if the injured person has suffered death, serious impairment of body function or permanent serious disfigurement.
(2) Notwithstanding any other provision of law, tort liability arising from the ownership, maintenance or use within this state of a motor vehicle with respect to which the security required by subsections (3) and (4) of section 3101 was in effect is abolished except as to:
(a) Intentionally caused harm to persons or property. Even though a person knows that harm to persons or property is substantially certain to be caused by his act or omission, he does not cause or suffer such harm intentionally if he acts or refrains from acting for the purpose of averting injury to any person, including himself, or for the purpose of averting damage to tangible property.
(b) Damages for noneconomic loss as provided and limited in subsection (1).
(c) Damages for allowable expenses, work loss and survivor’s loss as defined in sections 3107 to 3110 in excess of the daily, monthly and 3 year limitations contained in those sections. The party liable for damages is entitled to an exemption reducing his liability by the amount of taxes that would have been payable on account of income the injured person would have received if he had not been injured.” (Footnotes omitted; emphasis added.)

Under the majority’s rationale, an insured can recover all economic loss (to the statutory limits) from the insurer. The insured can also sue the tortfeasor for noneconomic losses. However, the majority concludes that the insurer can then offset the benefits it paid for economic loss against any judgment for noneconomic losses. It is easy to show the harsh results suffered by insureds under the majority’s analysis.

To determine the extent of the tortfeasor’s potential liability under MCLA 500.3135(2)(c); MSA 24.13135(2)(c), it is first necessary to recover economic loss benefits from the insurer. After such recovery, the insured can sue the tortfeasor under MCLA 500.3135(2); MSA 24.13135(2) for (a) any damages accruing solely from intentional conduct on the part of the tortfeasor; (b) any damages for noneconomic loss payable under MCLA 500.3135(1); MSA 24.13135(1); and (c), any damages 'for economic loss, in excess of the statutory limits. Payment of those damages, in addition to the payment of economic damages to the policy limits makes the insured whole. Yet the majority opinion forces the insured to disgorge part of that whole, with no recourse to the insured to collect the amount set off from the tortfeasor — the insured being limited by MCLA 500.3135(2)(c); MSA 24.13135(2)(c). That violation of the law of damages leads me to conclude that the setoff provision is both inequitable and unjust. Its implementation leads to an unconscionable result.

Thus, as in American Fidelity Fire Insurance Co v Williams, 80 Mich App 125; 263 NW2d 311 (1977) (Kaufman, J., dissenting): "I would 'enforce the remainder of the contract without the unconscionable clause’; [MCLA 440.2302(1); MSA 19.2302(1)] [] i.e., I would not enforce the set-off provision and therefore I would affirm the trial court.”

       The statement in Schigur v Secretary of State, supra, that no one in plaintiffs household owned a car, and therefore there was no "no-fault” coverage for plaintiffs injuries, is incorrect.

       This view has not had complete acceptance. The statute has been read to offer no escape from liability for uninsured motorists. In McKendrick v Petrucci, 71 Mich App 200; 247 NW2d 349 (1976), this Court rejected an equal protection challenge premised upon the absence of a threshold for liability for noneconomic loss caused by an uninsured motorist. McKendrick pointed out that "a reasonable construction of the entire section [MCLA 500.3135; MSA 24.13135] is that in every instance liability for noneconomic loss is limited by the threshold stated in paragraph (1), and that paragraph (2) only concerns the limitation of liability applicable when there is no-fault coverage”. 71 Mich App at 204. This construction appears preferable in view of the language and structure of the section.

        McKendrick is limited solely to the issue of meeting the threshold when the loss for which the uninsured motorist is liable is noneconomic. It was not intended to suggest nor do we now state that uninsured motorists cannot be held liable for economic loss. Furthermore, liability for such economic loss is not limited by any threshold question.

       An insured is therefore able to recover, under his uninsured motorist coverage, both economic and noneconomic losses. The fact that the arbitrator here limited the award, at plaintiffs ingenious request, to only noneconomic loss cannot serve to negate the policy provision for offset. An automobile owner is not required to agree to a policy provision offsetting personal protection benefits against an award under uninsured motorist coverage. Without such a provision, nothing would seem to be able to prevent an insured from recovering his economic losses under both personal protection coverage and uninsured motorist coverage. Of course, nothing precludes a person from negotiating with an insurance company for uninsured motorist coverage with policy limits higher than those in plaintiffs policy.

       The majority concedes that "[wjhether or not the person causing the accident is insured, the threshold for liability for noneconomic loss must be met”. (Footnote omitted.) Then the majority contends that "[w]hile an insured motorist is only liable for negligently caused economic loss that is in excess of personal protection benefits payable, MCLA 500.3135(2)(c); MSA 24.13135(2)(c), an uninsured motorist is given no immunity from tort liability for economic loss”. (Footnote omitted.)
      I retain a bemused puzzlement at the juxtaposition of those two assertions. I understand the majority’s initial concession as MCLA 500.3135(2); MSA 24.13135(2), mentions nothing of an insured-uninsured distinction. Therefore, subsection (2)(b) which allows for "fdjamages for noneconomic loss as provided and limited in subsection (1)”, is binding on an insured’s ability to collect from either insured or uninsured tortfeasors.
      As subsection (2)(c) was born of the same stock as subsection (2)(b), I fail to see how that subsection’s limitations are somehow lifted as to an uninsured tortfeasor. Certainly, nothing on the statute’s face would suggest such a distinction. Furthermore, an examination of MCLA 500.3107-500.3110; MSA 24.13107-24.13110, reveals no sub-categorization as suggested by the majority.
      While the majority’s construction might solve some of the problems attendant to its opinion, I do not believe that this Court, without something more than wishful thinking, can attribute such an interpretation to the statutory provisions cited above.

       The majority opinion in footnote 3 argues "[A]n automobile owner is not required to agree to a policy provision offsetting personal protection benefits against an award under uninsured motorist coverage”. That statement, which implies that an automobile owner may bargain away a contract clause such as the one mentioned above ignores the reality of the market place. This Court has found insurance contracts to be "inherently involved in the doctrine of contracts of adhesion”. Arrigo’s Fleet Service, Inc v Aetna Life & Casualty Co, 54 Mich App 482, 487; 221 NW2d 206 (1974), lv den 392 Mich 812 (1974), citing Zurich Insurance Co v Rombough, 384 Mich 228, 232-233; 180 NW2d 775 (1970).
      A more pertinent problem is the fact that plaintiff purchased uninsured motorist coverage for $2 extra where, in reality, its value was far less than the ostensible policy limitation.


text:
    GILMER v GENERAL MOTORS CORPORATION
    1. Workmen’s Compensation — Decision of Appeal Board — Orders —Written Opinions — Statutes.
    An order of the Workmen’s Compensation Appeal Board signed by a majority of a five member review panel is the board’s final decision under a section of the workmen’s compensation law regarding reviews by a panel of the board; the section of the law does not require a majority of the panel to join in a written opinion since the board’s written opinion is not its final decision under that section (MCLA 418.261; MSA 17.237[261]).
    2. Workmen’s Compensation — Appeal and Error — Questions of Law — Final Orders — Workmen’s Compensation Appeal Board — Testimony Adopted — Standards—Reasoning—Statutes.
    The Court of Appeals is empowered to review questions of law involved in a final order of the Workmen’s Compensation Appeal Board; implicit in this statutory scope of review is the obligation of the board to set forth the testimony adopted, the standard followed and the reasoning it used in reaching its conclusion (MCLA 418.861; MSA 17.237[861]).
    References for Points in Headnotes
    [1] 2 Am Jur 2d, Administrative Law § 583.
    82 Am Jur 2d, Workmen’s Compensation § 616.
    [2] 82 Am Jur 2d, Workmen’s Compensation §§ 630-637.
    Appeal from the Workmen’s Compensation Appeal Board.
    Submitted November 15, 1977, at Detroit.
    (Docket No. 77-396.)
    Decided January 5, 1978.
    Claim by Raymond E. Gilmer against General Motors Corporation for workmen’s compensation. Compensation denied. The Workmen’s Compensation Appeal Board reversed. Defendant appeals by leave granted.
    Affirmed.

      Miller, Klimist, Cohen, Martens & Sugerman, P. C, for plaintiff.

      Frazer F. Hilder, General Counsel, and Willard W. Wallace (E. R. Whinham, of counsel), for defendant.
    Before: Bronson, P. J., and Allen and T. M. Burns, JJ.
   Per Curiam.

This is an appeal by leave from a decision of the Workmen’s Compensation Appeal Board reversing a referee’s denial of compensation benefits and awarding plaintiff continuing disability compensation benefits for physical and psychological disability arising out of his employment. The appeal board’s opinion was signed by two of the five board members. Three members concurred in result only. The order awarding benefits was signed by all five members. The sole issue on appeal is whether a majority of the five-member board must join in a written opinion.

MCLA 418.261; MSA 17.237(261) provides in part:

"A matter pending on review shall be assigned to a panel of 5 members of the board for disposition. * * * The decision reached by a majority of the assigned 5 members shall be the final decision of the board. If a majority of the assigned 5 members are unable to agree, the matter shall be reviewed by the entire workmen’s compensation appeal board.”

The board’s order, not its written opinion, is its final decision under this section. Kozlowski v Chrysler Corp, 54 Mich App 100; 220 NW2d 319 (1974). In the case at bar, all five board members agreed on the order. Therefore, the board fully complied with MCLA 418.261; MSA 17.237(261). Nothing in that section requires a majority to join in a written opinion. Carter v General Motors Corp, 361 Mich 577; 106 NW2d 105 (1960).

Under MCLA 418.861; MSA 17.237(861), this Court is empowered to review questions of law involved in a final order of the board. Implicit in this statutory scope of review is the obligation of the board to set forth "the testimony adopted, the standard followed and the reasoning it used in reaching its conclusion”. McClary v Wagoner, 16 Mich App 326, 328; 167 NW2d 800 (1969). See, also, Carter v Detroit Board of Education, 66 Mich App 128; 238 NW2d 419 (1975), Gibbs v Keebler Co, 56 Mich App 690; 224 NW2d 698 (1974), Moore v Gundelfinger, 56 Mich App 73; 223 NW2d 643 (1974).

The opinion of the board in the case at bar satisfies the McClary requirement. The legal standard, testimony adopted and conclusion reached were meticulously set out in member Marshall’s opinion. Thus, this Court has a basis for reviewing any question of law raised by the case at bar.

Affirmed. Costs to appellee.

       The board’s findings of fact are conclusive, absent fraud. MCLA 418.861; MSA 17.237(861).

       Appellant does not contend and we do not find that the board applied an erroneous legal standard.


text:
    ATTORNEY GENERAL ex rel INSURANCE COMMISSIONER v MICHIGAN PROPERTY & CASUALTY GUARANTY ASSOCIATION
    1. Insurance — Statutes—Liberal Construction.
    Laws applicable to insurance are to be liberally construed in favor of policyholders, creditors and the public.
    2. Statutes — Construction—Object—Harmonious Result.
    A statutory provision is to be given a reasonable construction looking to its purpose and the object it seeks to accomplish, and should be considered with other sections appearing in the same act and interpreted so as to produce, with them, a total enactment that is harmonious and consistent.
    3. Insurance — Property and Casualty Guaranty Association— Duty to Pay Claims — Insolvent Insurers — Statutes.
    The Michigan Property and Casualty Guaranty Association has the duty to pay covered claims against an insolvent insurer incurred or existing prior to, on, or within 30 days after appointment of a receiver if the insolvent insurer had ever been authorized, after the inception of the act creating the association, to transact insurance business in Michigan (MCLA 500.7921[b], 500.7925[1] [iv]; MSA 24.17921[b], 24.17925[1] [iv]).
    4. Insurance — Rights of Policyholder — Accrual of Rights — Insolvent Insurers — Authority to Conduct Business.
    The rights of an insurance policyholder and third party beneficiaries accrue at the time that the policy is purchased and their right to collect their claims against an insolvent insurer from the Michigan Property and Casualty Guaranty Association is not affected by the fact that the insurer’s certificate of authority to conduct business had been revoked prior to the insurer’s insolvency.
    References for Points in Headnotes
    [1] 43 Am Jur 2d, Insurance §§ 260, 271-277.
    [2] 43 Am Jur 2d, Insurance §§ 270, 276.
    [3, 4] 43 Am Jur 2d, Insurance § 134.
    Appeal from Ingham, James T. Kallman, J.

      Submitted October 4, 1977, at Lansing.
    (Docket No. 77-650.)
    Decided January 5, 1978.
    Complaint by the Attorney General upon the relation of the Insurance Commissioner, ancillary receiver of several insolvent insurance companies, against the Michigan Property and Casualty Guaranty Association for a declaratory judgment that the association is responsible for payment and discharge of several claims against the insolvent insurers and to enjoin the association from denying payment and discharge of those claims. Summary judgment for plaintiff. Defendant appeals.
    Affirmed.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Harry G. Iwasko, Jr., and Louis J. Porter, Assistants Attorney General, for plaintiff.

      Dykema, Gossett, Spencer, Goodnow & Trigg (by Donald S. Young and Joseph C. Basta), for defendant.
    Before: D. C. Riley, P. J., and J. H. Gillis and R. M. Maher, JJ.
   Per Curiam.

Defendant Michigan Property and Casualty Guaranty Association (hereafter, "the Association”) appeals an adverse summary judgment issued by the Ingham Circuit Court which held the Association liable for "covered claims” made against three "insolvent insurer[s]” (Consolidated Underwriters, Inc., St. Louis Fire and Marine Insurance Company and Medallion Insurance Company) under the property and casualty guaranty association act (hereafter, "the act”), MCLA 500.7901 et seq.; MSA 24.17901 et seq., and which permanently enjoined the Association from denying liability under the act.

In his complaint, the Attorney General, relying upon the act, charged the Association with liability for the payment of no less than 45 claims made by Michigan residents against three named "insolvent insurers”. The complaint further alleged that the named insurers were member insurers at the time of the Association’s inception and that the Michigan Insurance Commissioner had been appointed as the ancillary receiver for the surviving entities of the foregoing insurers in 1976.

Denying liability, the Association responded that the named insurers were neither "member insurers” nor "insolvent insurers” within the meaning of the act since they were not authorized to transact business in Michigan at the time the ancillary receiver had been appointed.

The record below (consisting of the pleadings, appendices and requests for admissions) reveals that the named insurers were once authorized to transact insurance business in Michigan; according to defendant, however, the Insurance Commissioner effectively terminated these certificates in the latter part of 1972. Hence, as noted, the surviving insurers did not possess subsisting certificates of authority upon the receiver’s appointment in 1976.

Pointing to various sections of the act, to its legislative history and to other provisions of the Insurance Code, the Association maintains that it must pay only the covered claims of insolvent insurers who are member insurers, that is, insurers who are authorized insurers for which a receiver has been appointed.

As this Court recently noted in Metry, Metry, Sanom & Ashare v Michigan Property & Casualty Guaranty Association, 79 Mich App 226, 227; 261 NW2d 267 (1977), the act is remedial legislation designed to protect Michigan "insureds and parties injured by insureds” against the "covered [but typically uncollectible] claims” of statutorily defined "insolvent insurers”.

In pertinent part, the act provides:

"To implement the provisions of this chapter, there shall be maintained within this state, by all insurers authorized to transact in this state any of the kinds of insurance specified in section 7925, but including the accident fund created by section 701 of Act No. 317 of the Public Acts of 1969, being section 418.701 of the Compiled Laws of 1948, an association of such insurers to be known as the property and casualty guaranty association, hereafter referred to as the 'association’. Every such insurer shall be a member of the association, as a condition of its authority to continue to transact insurance in this state.” MCLA 500.7911; MSA 24.17911.
"As used in this chápter:
"(a) 'Member insurer’ means an insurer required to be a member of the association in accordance with the provisions of section 7911.
"(b) 'Insolvent insurer’ means a member insurer for which a domiciliary or ancillary receiver has been appointed in this state after the effective date of this chapter.” MCLA 500.7921; MSA 24.17921.

In addition, the act envisages the imposition of assessments against the Association’s members "[t]o the extent necessary to secure funds for the association for payment of covered claims and also for payment of reasonable costs of administering the association”. MCLA 500.7941; MSA 24.17941.

As polestars for our decision, we shall employ certain settled principles of statutory construction. In Commissioner of Insurance v American Life Insurance Co, 290 Mich 33, 43; 287 NW 368 (1939), the Supreme Court recognized that the insurance business is one affected with a public interest. For this reason, the Court said, laws applicable to insurance are to be "liberally construed in favor of policyholders, creditors and the public”. It added:

"In Attorney General, ex rel. Common Council of the City of Detroit, v. Marx, 203 Mich. 331 [168 NW 1005 (1918)], we quoted the following from 2 Lewis’ Sutherland Statutory Construction (2d Ed.), § 490:
"' "Statutes will be construed in the most beneficial way which their language will permit to prevent absurdity, hardship or injustice; to favor public convenience and to oppose all prejudice to public interests.” ’
"In Sibley v. Smith (syllabus), 2 Mich. 486 [(1853)], and again in Detroit Common Council v. Engel, 207 Mich 106 [173 NW 547 (1919)], we said:
" 'In construing statutes of doubtful meaning, courts are authorized to collect the intention of the legislature from the occasion and necessity of the law — from the mischief felt, and the objects and remedy in view — and the intention is to be taken, or presumed, according to what is consonant to reason and good discretion.’ ” Id. at 44-45.

Accord: Dearborn National Insurance Co v Commissioner of Insurance, 329 Mich 107; 44 NW2d 892 (1950), and Attorney General, ex rel Commissioner of Insurance v Michigan Surety Co, 364 Mich 299; 110 NW2d 677 (1961). See also State Farm Mutual Automobile Insurance Co v Kurylowicz, 67 Mich App 568, 578; 242 NW2d 530 (1976).

A statutory provision is to be given a reasonable construction looking to its purpose and the object it seeks to accomplish. It is to be considered with other sections appearing in the same act and interpreted so as to produce, with them, a total enactment that is harmonious and consistent. Royal Oak School District v Schulman, 68 Mich App 589, 593; 243 NW2d 673 (1976), Scholten v Rhoades, 67 Mich App 736, 745-746; 242 NW2d 509 (1976). Further, as this Court noted in Scholten:

"[W]here a statutory provision is clear and unambiguous, it is the court’s duty to enforce the provision as written. Ypsilanti Police Officers Association v Eastern Michigan University, 62 Mich App 87, 92-93; 233 NW2d 497 (1975). But a statute which is clear and unambiguous is nonetheless not to be given a construction which is absurd.” Id. at 744-745.

In the present suit, defendant cites in support of its interpretation the Insurance Code’s definition of " 'authorized’ insurer”, MCLA 500.108; MSA 24.1108, which, to be sure, requires possession of "a subsisting certificate of authority issued by the commissioner”. Defendant also takes note of MCLA 500.7833; MSA 24.17833, a provision (enacted contemporaneously with the act) which requires an appointed receiver "for any authorized insurer” to give prompt "notice of his appointment and a brief description of the contents of the property and casualty guaranty association act, if applicable” to specified parties by first class mail. Lastly, defendant apprises us of the act’s legislative history, namely, the rejection of original House Bill No. 3699 which would have required "[a]ll insurers licensed to write casualty, property and workmen’s compensation insurance * * * [to] assume all of the obligations * * * of any casualty, property or workmen’s compensation insurer which has been declared insolvent * * * (Emphasis supplied.) Thus, the Association asserts, the more restrictive language of the act as ultimately promulgated, requiring the Association’s payment solely of covered claims of insolvent, member insurers, evinces a legislative intent to satisfy the obligations of only those insolvent insurers which are authorized to transact business at the time of the receiver’s appointment.

The Association neglects, however, to note the concluding phrase of the provision defining "insolvent insurer”, and a pertinent portion of the definition of "covered claims”:

"(b) 'Insolvent insurer’ means a member insurer for which a domiciliary or ancillary receiver has been appointed in this state after the effective date of this chapter.” MCLA 500.7921(b); MSA 24.17921(b). (Emphasis added.)
"(1) 'Covered claims’ means obligations of an insolvent insurer which * * * (iv) were incurred or existed prior to, on, or within 30 days after the date the receiver was appointed." MCLA 500.7925(l)(iv); MSA 24.17925(l)(iv). (Emphasis added.)

Guided by our duty liberally to construe insurance laws "in favor of policyholders, creditors and the public”, Commissioner of Insurance v American Life Insurance Co, supra, we read the last cited provisions, taken together, to suggest that the significant temporal reference, for purposes of the present issue, is the effective date of the act. In other words, if, after the act’s inception, an insurer had ever been authorized to transact insurance business in Michigan and subsequently had a receiver appointed for it, the Association’s duty to pay covered claims (incurred or existing prior to, on, or within 30 days after the receiver’s appointment) is thus invoked. Hence, that such an insurer may have been stripped of its authority to transact business prior to the receiver’s appointment is of no moment.

As the Attorney General correctly notes, the Association’s contention, if applied, would have an enervating effect on the act: It would place the Commissioner in the untenable position of refraining from the use of his power to revoke a certificate of authority, see MCLA 500.434; MSA 24.1434, repealed by 1972 PA 360 and replaced by an expanded section, MCLA 500.436; MSA 24.1436, for fear that such revocation would relieve the Association of its obligation to pay covered claims and would thereby relegate the act’s intended beneficiaries to the status of general creditors of an insolvent insurer. Further, this enforced timidity on the part of the Commissioner would enhance the prospect that unsuspecting persons might purchase insurance, from an authorized but financially troubled insurer, only to learn on the insurer’s later insolvency that their claims, for all practical purposes, are uncollectible.

With regard to the act’s legislative history, we have noted in another context that it does not readily disclose the reason inspiring the changes in wording from the predecessor version to the act as promulgated. See Metry, supra, at 231. While defendant characterizes the changes as supportive of its contention, we agree with the Attorney General in reading the legislative changes as an attempt to exempt the Association from liability for claims of "surplus lines” insurers, that is, unauthorized, out-of-state insurers permitted to write policies for Michigan residents who are unable to obtain suitable coverage at reasonable rates from Michigan-authorized insurers. See MCLA 500.1840 et seq.; MSA 24.11840 et seq.

In our view, the argument advanced by the Attorney General is compelling:

"The * * * [Association] has attempted to create a third class of insurance company. That third class is a member insurer which has lost its certificate of authority at the time of the insolvency proceedings. Clearly, there is no excuse, other than saving money, for the insurance industry’s attempt to evade indemnifying policyholders and third party beneficiaries of a member insurer which is without a certificate of authority at the time of insolvency. There is no rational reason for differentiating between member insurers on the basis of whether they possess a certificate of authority at the time of the insolvency proceedings. The only rational determination of member insurer status is at the time that the insurance policy was issued.
" * * * The Michigan citizens who purchased their policies from companies which were licensed at * * * [that] time * * * should not lose their right to collect from the fund due to the regulatory activity of the Insurance Commissioner * * * . The rights of the policyholder and third party beneficiaries accrue at the time that the policy is purchased and their right to collect their claims from the guaranty fund is not diminished by actions taken by others outside their immediate control.
"The interpretation proposed by the * * * [Association] benefits the * * * [Association] to the detriment of all policyholders in the State of Michigan, because they can never know that the fund will be liable to pay a claim on their behalf in the event their company becomes insolvent. There was no intention on the part of the legislature to create this uncertainty. Instead, it was the intention of the legislature to remove for all time the risk of insolvency from the shoulders of the policyholders and third party beneficiaries. It is equally clear that the legislature did not set up three categories of insolvent insurers: members, surplus lines and members who no longer hold certificates. The legislature intended to create but two categories: member insurers and surplus lines companies that were not licensed to do business in Michigan at the time that the obligation to the policyholders and third party beneficiaries accrued.”

Accordingly, the lower court is affirmed.

No costs, a public question having been resolved.

       MCLA 500.7941; MSA 24.17941 further provides that such "assessments shall be recognized in the rate-making procedures for insurance rates in the same manner that expenses and premium taxes are recognized.”

       To the . extent it is impossible to harmonize our interpretation of the act with the notice requirements of MCLA 500.7833; MSA 24.17833, we believe the more salutary course is to preserve the act’s remedial design (viz., protecting an insolvent insurer’s policyholders and injured third-party claimants) and allow the instant decision to inform appointed receivers that the phrase "authorized insurer” in MCLA 500.7833; MSA 24.17833 comprehends, for purposes of the guaranty act, any member insurer which once had been authorized after the act’s effective date.


text:
    MERRITT v NICKELSON
    1. Tenancy in Common — Tokts—Liability—Participation by Co-Tenants.
    A tenant in common cannot be held liable for injury caused by a cotenant who has exclusive control of the object of common ownership; it is a general principle of tort law that a person is liable only as he participates in an activity giving rise to a tort; the mere co-ownership of land standing alone will not subject a person to liability for torts committed in the land by the other co-owners.
    2. Tenancy in Common — Possession—Occupancy of Land — Enjoyment of Land.
    Tenants in common are persons who hold land or other property by unity of possession; two or more persons that are entitled to land in such a manner that they have an undivided possession, but separate and distinct freeholds, are tenants in common; the possession of one tenant in common is the possession of all the tenants in common and the tenants in common respectively have the present right to enter upon the whole land, and upon every part of it, and to occupy and enjoy the whole.
    3. Tenancy in Common — Liability—Exclusive Control.
    The fact that one party is a tenant in common with a second party does not ipso facto render the first party liable for the acts of the second party when that second party has exclusive control of the object of common ownership.
    4. Property — Possession—Right to Possession — Ownership—Control.
    "Possession” is the detention and control of anything which may be the subject of property, for one’s use and enjoyment; "possession” differs from the "right to possession” and "ownership” because of the concept of control; the mere "right to possession” does not necessarily entail the control inherent in the nature of "possession”.

      References for Points in Headnotes
    [1, 3, 5] 20 Am Jur 2d, Cotenancy and Joint Ownership §§ 37, 90.
    [2] 20 Am Jur 2d, Cotenancy and Joint Ownership § 22.
    [4] 20 Am Jur 2d, Cotenancy and Joint Ownership § 1.

      5. Negligence — Real Property — Defective Premises — Determinative Factors — Control—Possession.
    Control and possession are the determinative factors in the imposition of liability for an injury due to defective premises.
    Appeal from Manistee, Charles A. Wickens, J.
    Submitted November 3, 1977, at Grand Rapids.
    (Docket No. 77-1034.)
    Decided January 5, 1978.
    Leave to appeal applied for.
    Complaint by Frances Merritt, administratrix of the estate of Alan W. Merritt, deceased, against Howard E. Nickelson, James Ledford and Marie Ledford seeking damages for wrongful death resulting from an accident at a drag strip. A consent judgment was entered against defendant Nickelson prior to trial in circuit court. Judgment for plaintiff against defendants Marie Ledford and James Ledford. Defendant Marie Ledford appeals.
    Remanded for further proceedings.

      Jennings & DeVries, for plaintiff.

      Zerafa, Zerafa & Christian, P. C., for defendants.
    Before: R. M. Maher, P. J., and M. F. Cavanagh and N. J. Kaufman, JJ.
   Per Curiam.

Defendant Marie Ledford appeals as of right from a January 26, 1976, judgment after a nonjury trial in which $137,800 in damages were awarded to plaintiff against both defendants Marie and James Ledford. The trial court found both defendants negligent in the operation of a race track which functioned primarily as a drag strip. Prior to May 6, 1970, defendant Marie Led-ford was the sole owner of the land, approximately 25 acres, on which the drag strip was built. On that date she deeded the property to herself and to her son, defendant James Ledford, as tenants in common by a quitclaim deed for a consideration of $500.

On May 30, 1970, the first day that the drag strip had been opened to the public, defendant Howard Nickelson, one of the participants at the track, while racing his car, was shifting into third gear when his clutch came apart and the flywheel disintegrated. Pieces of the steel flywheel tore holes in the floorboard and roof of his car; one of the pieces was thrown through the air and injured Alan Merritt, a spectator. Merritt died from the injury.

The driver of the car, Nickelson, through his insurance company, paid the plaintiffs estate the sum of $8,500.

Plaintiff, as administratrix of Alan Merritt’s estate, claimed that defendants, Marie and James Ledford, as owners and operators of the track, were negligent in failing to make a safety inspection of the cars and in not requiring that the cars be equipped with a scatter shield for the flywheel. Rules promulgated by the National Hot Rod Association recommend that cars engaged in drag racing have scatter shields to contain pieces of the flywheel in the event it disintegrates. The trial court found both defendants negligent and further held that their negligence was the cause of Mr. Merritt’s death.

On appeal, defendant Marie Ledford claims that mere ownership of property by one co-tenant is not a sufficient basis on which to impose liability for the negligent acts of another co-tenant. We agree.

Nothing in the record discloses that Marie Led-ford operated the drag strip: to the contrary, uncontradicted testimony at trial made it clear that Marie Ledford was in no way involved in the operation of the drag strip. She was merely, along with her son, James Ledford, a tenant in common of the property.

Tenants in common are persons who hold land or other property by unity of possession. When two or more persons are entitled to land in such a manner that they have an undivided possession, but separate and distinct freeholds, they are tenants in common. Not only is the possession of one the possession of all, but the tenants respectively have the present right to enter upon the whole land, and upon every part of it, and to occupy and enjoy the whole. Fenton v Miller, 94 Mich 204; 53 NW 957 (1892), Metcalfe v Miller, 96 Mich 459; 56 NW 16 (1893), Tiffany, The Law of Real Property (3d ed), § 426, p 212.

Ordinarily, negligence of one co-owner is not imputed to the other co-owner. Mortensen v Knight, 81 Ariz 325; 305 P2d 463 (1956). The fact that one party is a tenant in common with a second party does not ipso facto render the first party liable for acts of the second party when that second party has exclusive control. McDonald v Standard Gas Engine Co, 8 Cal App 2d 464; 47 P2d 777 (1935).

To argue, as plaintiff does, that a co-owner’s right to possession of the premises is sufficient to hold that co-owner liable for all injuries on the premises is to be simplistic. The issue of control is preeminent.

"[T]he rights and liabilities arising out of the condition of land, and activities conducted upon it, have been concerned chiefly with the possession of the land * * * for the obvious reason that the man in possession is in a position of control, and normally best able to prevent any harm to others.” Prosser, Law of Torts (3d ed), § 57, p 358. (Footnote omitted.)
"Possession” differs from the "right to possession” and "ownership” because of the concept of control. Possession is the detention and control of anything which may be the subject of property, for one’s use and enjoyment. Blacks Law Dictionary (4th ed), p 1325. The mere "right to possession” does not necessarily entail the control inherent in the nature of "possession”.

It has been recognized in this state that control and possession are the determinative factors in the imposition of liability.

"It is a general proposition that liability for an injury due to defective premises ordinarily depends upon power to prevent the injury and therefore rests primarily upon him who has control and possession.” Dombrowski v Gorecki, 291 Mich 678, 681; 289 NW 293 (1939), citing Bannigan v Woodbury, 158 Mich 206; 122 NW 531 (1909).

See also Nezworski v Mazanec, 301 Mich 43; 2 NW2d 912 (1942), and Paisley v United Parcel Service, Inc, 17 Mich App 672; 170 NW2d 283 (1969).

In the instant case, defendant James Ledford had complete control over the drag strip according to trial testimony which plaintiff did not refute. Appellant Marie Ledford was merely a co-owner with no control whatsoever. In analogous situations, owners of land as tenants by the entirety or as joint tenants do not share liability when injury or negligence is attributable to the independent act of a single tenant who has exclusive control of the premises. Dombrowski v Gorecki, supra, Maynard v Hawley, 331 Mich 123; 49 NW2d 92 (1951).

Kearns v Steinkamp, 184 Ark 1177; 45 SW2d 519 (1932), is characteristic of this class of cases. A husband had constructed and operated a swimming pool owned jointly with his wife. The wife was held to be not liable for injuries to a swimmer using the pool, since she exercised no control over its operation and there was no relation of master and servant or principal and agent subsisting between husband and wife.

It is likewise true that a tenant in common cannot be held liable for injury caused by a co-tenant who has exclusive control of the object of common ownership.

"It is a general principle of tort law that a person is liable only as he participates in an activity giving rise to a tort. Mere co-ownership of land standing alone will not subject a person to liability for torts committed in the land by the other co-owners.” Musser v Loon Lake Shores Association, Inc, 384 Mich 616, 622; 186 NW2d 563 (1971).

Marie Ledford had no control over the condition of the drag strip or the cars driven there. As she did not participate in the operation of the raceway nor have any interest in it other than her status as a tenant in common, she cannot be held liable for injuries which occurred as a result of the race track’s operation.

We see nothing in the case warranting a new trial. However, plaintiff may have believed that for purposes of liability she need only show that Marie Ledford was a co-tenant of the property. Plaintiff may be able to present evidence which proves that Marie Ledford was more than a mere co-tenant and that she had some degree of possession and control. Mindful of this possibility, we remand this cause for a hearing before the trial judge at which time plaintiff may make an offer of proof of Marie Ledford’s status as possessor and controller of the property.

Should the offer of proof disclose a possible basis for liability, the judge will reopen the trial on the issue of liability alone. If the judge is satisfied that the proof plaintiff offers will be an insufficient basis on which to find Marie Ledford liable, the judgment of the trial court as to appellant is reversed. In either case, the damages remain the same.


text:
    AMERICAN FIDELITY FIRE INSURANCE COMPANY v BARRY
    1. Arbitration and Award — Contracts—Scope of Arbitration— Judicial Determination.
    The scope of arbitration of a contract is determined by the contract between the parties; whether or not an issue is arbitrable is a matter for judicial determination.
    2. Arbitration and Award — Contracts—Arbitrable Issues— Courts — Scope op Arbitration.
    The scope of a court’s consideration whether an issue arising under a contract is arbitrable is sharply limited; if a claim on its face is governed by the contract, it should be decided by the arbitrator unless strong evidence demonstrates that the matter is outside the scope of the arbitration provision.
    3. Arbitration and Award — Public Policy — Arbitrable Issues— Liberal Construction — Arbitration Clause.
    Public policy in Michigan favors arbitration in the resolution of disputes; arbitration clauses contained in contracts are to be liberally construed, resolving any doubts about the arbitrability of an issue in favor of arbitration.
    4. Arbitration and Award — Contracts—Arbitrable Issues— Three-Stage Inquiry.
    The arbitrability of an issue in a contract is ascertained through a three-stage inquiry: (1) Is there an arbitration agreement in a contract between the parties? (2) Is the insured’s claim "on its face” or "arguably” related to the contract? and (3) Is the dispute "expressly exempt” by the terms of the contract?
    5. Insurance — Contracts—Ambiguities—Construction of Ambiguous Insurance Contracts.
    An ambiguous insurance contract is construed against the insurance company which prepared it.
    References for Points in Headnotes
    [1, 2, 4] 5 Am Jur 2d, Arbitration and Award § 54.
    [3] 5 Am Jur 2d, Arbitration and Award § 14.
    [5] 43 Am Jur 2d, Insurance § 257.
    [6] 5 Am Jur 2d, Arbitration and Award § 167.
    [7] 5 Am Jur 2d, Arbitration and Award § 145.
    [8] 73 Am Jur 2d, Summary Judgment § 1.

      6. Arbitration and Award — Vacating Award — Authority op Arbitrator — Non ARBITRABLE ISSUES — COURT RULES.
    An arbitration award may be set aside where an arbitrator exceeds his authority because a nonarbitrable issue has been submitted to him (GCR 1963, 769.9).
    7. Arbitration and Award — Appeal and Error — Preserving Question — Arbitrability op Dispute — Arbitrator.
    The issue of whether or not a dispute is arbitrable is preserved for appeal where arguments against arbitrability are addressed to the arbitrator himself.
    8. Judgment- — Summary Judgment — Accelerated Judgment — Motions.
    The Court of Appeals may treat a motion for accelerated judgment as a motion for summary judgment.
    Appeal from Wayne, Benjamin D. Burdick, J.
    Submitted November 7, 1977, at Detroit.
    (Docket No. 77-1993.)
    Decided January 5, 1978.
    Leave to appeal denied, 402 Mich —.
    Complaint by American Fidelity Fire Insurance Company against Dorothy Barry and the American Arbitration Association for a declaratory judgment that no contract existed between the plaintiff and defendant Barry providing for uninsured motorist coverage with respect to a certain vehicle and seeking to enjoin arbitration proceedings. Judgment for defendants. Plaintiff appeals.
    Affirmed.

      Lakin & Worsham, P. C., for plaintiff.

      Charles E. Raymond, for defendant Dorothy Barry.
    Before: D. C. Riley, P. J., and D. F. Walsh and A. C. Miller, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   Per Curiam.

This is an appeal from the granting of accelerated judgment in favor of defendants in an action for declaratory judgment brought by plaintiff insurance company. Plaintiff sought a determination that there existed no contract between the parties providing for uninsured motorist coverage with respect to a particular vehicle, and also sought to enjoin arbitration proceedings demanded by defendant Barry.

It is undisputed that there is an insurance contract between the parties applicable to a 1966 Mercury in which defendant claims she was driving when she was injured by an uninsured motorist. The insurer, though, denies that the policy includes uninsured motorist coverage. The policy contains an arbitration provision:

"8. Arbitration: If any person making claim hereunder and the company do not agree that such person is legally entitled to recover damages from the owner or operator of an uninsured automobile because of bodily injury to the insured, or do not agree as to the amount of payment which may be owing under this endorsement, then, upon written demand of either, the matter or matters upon which such person and the company do not agree shall be settled by arbitration in accordance with the rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. Such person and the company each agree to consider itself bound and to be bound by any award made by the arbitrators pursuant to this endorsement.”

Under MCLA 600.5001(2); MSA 27A.500K2), "[s]uch an agreement shall stand as a submission to arbitration of any controversy arising under said contract not expressly exempt from arbitration by the terms of the contract”. Defendant contends and the trial court agreed that her dispute with plaintiff as to the scope of her coverage is arbitrable under their contract; plaintiff insists otherwise.

The scope of arbitration is determined by the contract between the parties; whether an issue is arbitrable or not is a matter for judicial determination. Kaleva-Norman-Dickson School District No 6, Counties of Manistee, Lake & Mason v Kaleva-Norman-Dickson School Teachers’ Association, 393 Mich 583, 587; 227 NW2d 500 (1975), Brown v Holton Public Schools, 397 Mich 71, 74; 243 NW2d 255 (1976). But the scope of a court’s consideration whether an issue is arbitrable is sharply limited. If a claim on its face is governed by the contract, it should be decided by the arbitrator unless strong evidence demonstrates that the matter is outside the scope of the arbitration provision. Kaleva, supra, at 590-595, Ferris State College v Ferris Faculty Association, 72 Mich App 244, 247-248; 249 NW2d 375 (1976). Recently, this Court forcefully restated the rule of judicial deference toward the arbitration of arbitrability:

"Public policy in this state favors arbitration in the resolution of disputes. Kaleva-Norman-Dickson School District No 6 v Kaleva-Norman-Dickson School Teachers’ Association, 393 Mich 583; 227 NW2d 500 (1975). Arbitration clauses contained in contracts are to be liberally construed, Stadel v Granger Brothers, Inc, 4 Mich App 250, 258; 144 NW2d 609 (1966), resolving any doubts about the arbitrability of an issue in favor of arbitration. Chippewa Valley Schools v Hill, 62 Mich App 116; 233 NW2d 208 (1975), lv den, 395 Mich 806 (1975). If the arbitration clause arguably includes the asserted dispute, then arbitration should be ordered upon proper motion. GCR 1963, 769. Kaleva-NormanDickson School District No 6 v Kaleva-Norman-Dickson School Teachers’ Association, supra, at 592, Ferris State College v Ferris Faculty Association, 72 Mich App 244; 249 NW2d 375 (1976).” Campbell v Community Service Insurance Co of Lansing, Michigan, 73 Mich App 416, 419; 251 NW2d 609 (1977).

In this case, defendant’s claim "on its face” relates to the insurance contract for the 1966 Mercury created by the endorsement of January 3, 1975. It is true that on the merits the claim appears to be unsound. The endorsement by which the 1966 Mercury was substituted for another vehicle appears to make no provision for uninsured motorist coverage. But the question is not whether the claim is valid but rather who is to pass on its validity in the first instance. As Justice Levin wrote in his Kaleva opinion:

"In deciding whether a dispute involving an issue of contract interpretation is arbitrable, a court should guard against the temptation to make its own interpretation of the substantive provisions of the contract encompassing the merits of the dispute. If the parties have agreed that an arbitrator shall decide questions of contract interpretation, the merits of the dispute are for the arbitrator.
"Where a court finds itself weighing the pros and cons of each party’s interpretation of substantive provisions of the contract, it is likely that the court has gone astray. The question for the court is not whether one interpretation or another is correct, but whether the parties have agreed that an arbitrator shall decide which of the competing interpretations is correct.” 393 Mich at 594-595.

The arbitrability of an issue is ascertained through a three-stage inquiry.

First, is there an arbitration agreement in a contract between the parties? We agree with the trial court that there is. Plaintiff makes the strained argument that there are actually several contracts — for bodily injury liability, for property damage liability, etc. — between plaintiff and defendant with respect to each insured vehicle, consequently it can be said that there is no contract for uninsured motorist coverage under which to arbitrate anything. We disagree. The cases cited by plaintiff finding distinct insurance contracts which could be "stacked”, Citizens Mutual Insurance Co v Turner, 53 Mich App 616; 220 NW2d 203 (1974), Arminski v United States Fidelity & Guaranty Co, 23 Mich App 352; 178 NW2d 497 (1970), are inapposite, among other reasons, because, there, separate and independent premiums were paid on separate vehicles. We reject plaintiff’s argument in this context as an abstract formalism, as we have rejected similar arguments by other insurers seeking to avoid arbitration under agreements they had themselves prepared. See Detroit Automobile Inter-Insurance Exchange v Spafford, 62 Mich App 365; 233 NW2d 283 (1975), and Campbell v Community Service Insurance Co of Lansing, Michigan, supra. We, therefore, conclude that the present dispute "presents questions of coverage”, Spafford, supra, at 369, and is a "dispute * * * over payment”, Campbell, supra, at 419.

Second, is the insured’s claim "on its face”, Kaleva, supra, or "arguably”, Campbell, supra, related to the contract? In answering this question, any doubts should be resolved in favor of arbitration. Chippewa Valley Schools v Hill, 62 Mich App 116, 120; 233 NW2d 208 (1975), lv den, 395 Mich 806 (1975), Campbell, supra, at 419. Defendant’s claim "on its face” is based on her insurance contract with plaintiff concerning the 1966 Mercury. The claim may well prove to be as groundless as defendant insists it is, but even if it would be a "clear error” to make an award to the defendant, the dispute is arbitrable. Compare Spafford, supra, with Detroit Automobile Inter-Insurance Exchange v Spafford, 76 Mich App 85; 255 NW2d 780 (1977).

Third, is the dispute "expressly exempt” by the terms of the contract? If not, it is arbitrable. MCLA 600.5001(2); MSA 27A.500K2), Kaleva, supra, at 592-593. Plaintiff insurer has not claimed that the arbitration provision exempts disputes of this type, though there was nothing to prevent it from excluding "matters of coverage” from arbitration, see, e.g., American Motorists Insurance Co v Llanes, 64 Mich App 105, 108; 235 NW2d 77 (1975), rev on other grounds, 396 Mich 113; 240 NW2d 203 (1976). An ambiguous insurance contract is construed against the insurance company which prepared it. Lintern v Zentz, 327 Mich 595, 600; 42 NW2d 753; 18 ALR2d 713 (1950); 43 Am Jur 2d, Insurance, § 271, pp 329-331. The case against the defendant may well be as strong as the plaintiff insists, but the arguments should be addressed to the arbitrator, not the courts. This Court disfavors attempts "to segregate disputed issues into arbitrable sheep and judicially-triable goats (or vice versa)”. Maryland Casualty Co v McGee, 32 Mich App 539, 545; 189 NW2d 44 (1971); see also Michigan Mutual Liability Co v Graham, 44 Mich App 406, 407; 205 NW2d 289 (1973). If the arbitrator exceeds his authority because a nonarbitrable issue has been submitted to him, the award may be vacated. GCR 1963, 769.9, Detroit Demolition Corp v Burroughs Corp, 45 Mich App 72, 79-80; 205 NW2d 856 (1973), Ferndale Education Association v School District for the City of Ferndale #2, 67 Mich App 645, 649-650; 242 NW2d 481 (1976).

Plaintiff insists that it has to challenge the jurisdiction of the arbitrator before proceeding to arbitration or else waive any claim that the dispute is not arbitrable, citing American Motorists Insurance Co v Llanes, 396 Mich 113; 240 NW2d 203 (1976). In Llanes the Supreme Court held that since the insurer "proceeded without objection on arbitrability”, it could not raise that issue for the first time by a subsequent action for declaratory judgment:

"At the hearing before the arbitrator, American objected to the proceeding on the basis of insufficient notice and contended it was not liable under the 'hit and run’ provision of the policy. The issue of the arbitrability of the claim was not raised. Having proceeded without objection on arbitrability, American submitted the question to the arbitrator for decision. American may not now challenge the unfavorable award in court by complaining, for the first time, that the issue decided was excluded from arbitration. Hopkins v Auto-Owners Insurance Co, 41 Mich App 635; 200 NW2d 784 (1972); Detroit Demolition Corp v Burroughs Corp, 45 Mich App 72; 205 NW2d 856 (1973).” 396 Mich at 114.

The Supreme Court then cited an ALR Annotation:

"If a party to an arbitration agreement wants to object to the arbitrability of a specific issue, he should do so at the earliest opportunity. He should raise the objection before the issue is submitted for a hearing on its merits, because he may not voluntarily submit an issue to arbitration and then, if he suffers an adverse decision, move to set aside the adverse award on the ground that it was not an arbitrable issue.” Anno: Participation in Arbitration Proceedings as Waiver of Objections to Arbitrability, 33 ALR3d 1242, 1244.

We believe that the plaintiff has misinterpreted Llanes. There the insurance company never raised the arbitrability issue before the arbitrator himself, and the Supreme Court properly penalized it for participating in arbitration without objection in hopes of prevailing on the merits, then collaterally attacking the award in court by denying arbitrability in case of defeat. Llanes did not discuss what form the objection should take in order to preserve the issue for court consideration. The annotation makes clear that the manner of objection varies in different jurisdictions:

"In some states, it may be sufficient merely to raise the objection before or at the beginning of the arbitration hearing. If the arbitrators overrule the objection and proceed to decide the dispute, the objecting party ordinarily should move to vacate the award on the ground that the arbitrators did not have jurisdiction of the dispute or that the issue was not arbitrable. If the motion is denied, the parties may raise the issue on an appeal.” Anno: Participation in Arbitration Proceedings as Waiver of Objections to Arbitrability, 33 ALR3d 1242, 1245. (Footnote omitted.)

Llanes should be read in comparison with the Detroit Demolition case, supra, where the defendant participated in arbitration under court order, raised the arbitrability issue before the arbitrator, and later brought an action to vacate the award. 45 Mich App at 76-78. This show of resistance established that the insurer did not waive its objection by submitting to arbitration. 45 Mich App at 78-79. In this case, the plaintiff brought an action for declaratory judgment and to stay the arbitration; it moved for a rehearing when the motion was denied; it brought an interlocutory appeal to this Court to stay the arbitration during the pendency of this appeal; and finally it has appealed the granting of accelerated judgment. If plaintiff addresses its arguments against arbitrability to the arbitrator himself, it will have preserved its objection.

Plaintiff also points out, correctly, that it was improper to dispose of this case by accelerated judgment. GCR 1963, 116, Drouillard v Roseville, 9 Mich App 239; 156 NW2d 628 (1967). Summary judgment was the proper way to proceed. GCR 1963, 117, Pompey v General Motors Corp, 385 Mich 537; 189 NW2d 243 (1971). But no purpose would be served by a refusal to reach the merits predicated upon this basis. This Court may treat a motion for accelerated judgment as a motion for summary judgment. Sims v United Papermakers & Paperworkers AFL-CIO, 26 Mich App 129, 134; 182 NW2d 90 (1970), Schimmer v Wolverine Insurance Co, 54 Mich App 291, 298; 220 NW2d 772 (1974).

Affirmed.

Costs to appellees.

       Plaintiff also expresses "perplexity” at the perceived inconsistency between Llanes and Nickerson v Citizens Mutual Insurance Co, 393 Mich 324; 224 NW2d 896 (1975). There the arbitrator was presented with the issue whether a person who got out of a stalled car and was injured by an uninsured motorist was "occupying” the car. The arbitrator declined to rule on that issue, saying that it was not arbitrable, and the Supreme Court eventually decided it. Id. at 327-328. The Court held that defendant’s failure to contest the award within 20 days pursuant to GCR 1963, 769.9(2) was immaterial because the arbitrator refused to decide the arbitrability issue anyway, although defendant did lose the right to challenge the two issues that were decided, fault and damages. Id. at 327-328. The essential difference between Llanes and Nickerson is that in Llanes the objecting party never raised the arbitrability issue before the arbitrator, whereas in Nickerson the issue was raised.