Lawyers’ Corner: Domicile in Westfield Ins Co v Progressive Ins Co

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Auto accidents can happen anywhere, anytime, to anyone. And that includes couples going through marital troubles or divorce. If husband and wife aren’t living under the same roof when the accident happens, does the estranged spouse’s domicile matter in receiving no-fault benefits?

Car crashes don’t happen in a vacuum. Serious auto accidents sometimes happen in the midst of other complicated life situations. And that can in turn complicate a person’s no-fault case. In a recent example, the Michigan Court of Appeals considered the case of an auto accident that happened in the midst of marital discord. With the spouses separated the court asked where was the husband’s domicile?

In Westfield Ins Co v Progressive Michigan Ins Co motorist Curtis Stanley, his wife Shiela, and two of their children were injured in an auto accident on February 21, 2009. The family was riding in a 1996 Ford Windstar that Curtis had purchased for his wife, but had not insured. Curtis did own other vehicles that were insured by Westfield, so Westfield paid no-fault benefits to Shiela and the children for injuries related to the accident.

Later, Westfield determined that Discount Towing owned the vehicle at the time of the accident. The company had insurance through Progressive. Westfield filed sued Progressive for partial recoupment, claiming the two companies were of equal priority as to the PIP benefits. But Progressive said no. The company took the position that Shiela and the children were entitled to benefits from Curtis’s policy as resident relatives, even though the couple was separated and Curtis was living with his parents in Ypsilanti. His domicile, the company said, had not changed.

Domicile Requires Subjective Intent to Remain

The appeal centered on the payment of PIP benefits to the Stanley children. MCL 500.3114(1) says:

“Except as provided in subsections (2), (3), and (5), a personal protection insurance policy described in section 3101(1) applies to accidental bodily injury to the person named in the policy, the person’s spouse, and a relative of either domiciled in the same household, if the injury arises from a motor vehicle accident.”

The question for the court was whether the Stanley children were domiciled in the same household as their father. Westfield argued that because Curtis had not lived with his children for the past year he was not ‘domiciled in the same household.’

The court said “The terms ‘residence’ and ‘domicile’ are not synonymous.” Citing Grange Ins Co of Mich v Lawrence, the court said:

“Michigan courts have defined “domicile” to mean the place where a person has his true, fixed, permanent home, and principal establishment, and to which, whenever he is absent, he has the intention of returning.” Id. at 493 (citation and internal quotation marks omitted). “Similarly, a person’s domicile has been defined to be that place where a person has voluntarily fixed his abode not for a mere special or temporary purpose, but with a present intention of making it his home, either permanently or for an indefinite or unlimited length of time.”

Temporary removal from that residence does not defeat domicile. Instead, courts are to consider several factors:

  • The Subjective Or Declared Intent To Permanently Or Indefinitely Remain In A Residence;
  • The Relationship Between Members Of The Household;
  • Whether The Residence Is On The Same Property;
  • The Existence Of Another Place Of Lodging.

Here Curtis and Shiela saw their current living arrangement as temporary. His declared intent was to remain married to Shiela and live with his parents while they worked on their marital issues. The way the family shared a vehicle and the fact that Curtis had purchased the Windstar for Shiela’s use demonstrated this intent to be reunited. Since it was his subjective intent to remain, the court found that Curtis had not changed his domicile when he moved out of his wife’s home to live with his parents.

Benefits for a Non-Resident Spouse

Shiela’s no-fault benefits were not challenged in the appeal. In 1991, a Michigan Court of Appeals decision, Citizens Mut Ins Co v Community Servs Inssaid that no-fault PIP benefits are extended to an estranged wife no longer living with her husband, who owned the policy. The language requiring a relative to be “domiciled in the same household” did not apply to the word spouse in the statute.

However, the Westfield opinion could lead a person to the opposite conclusion. Spousal benefits are buried in a footnote without reference to Citizens. Instead, the opinion states:

“This provision requires that a ‘relative’ of the insured or the insured’s spouse must be ‘domiciled in the same household’ as the insured in order to recover no-fault benefits from the insured’s insurer. See Grange Ins Co of Mich, 494 Mich at 490-492. Accordingly, if Curtis Stanley was domiciled with his wife and children in Canton, then Westfield would be a higher priority insurer and would not be entitled to partial recoupment.”

This statement could easily lead an unwary auto accident attorney to assume that an estranged spouse is not entitled to PIP benefits if he or she is not ‘domiciled in the same household’ as the insured. While the case was only addressing the children, it was written in a broad way that could easily be misunderstood.

The ambiguous language in Westfield serve as a warning for auto accident attorneys, to always double check their assumptions. The rules regarding resident relatives that apply to children and other household members don’t automatically apply to spouses. Auto lawyers should be sure to read the Michigan No-Fault Act carefully and double check the basis for any PIP benefit claims. Otherwise you may create hurdles for your clients that don’t actually exist.

David Christensen is an auto accident attorney at Christensen Law in Southfield, Michigan with over 25 years experience. If your client is facing a difficult no-fault issue, contact Christensen Law today for a referral.