                          STATE OF MICHIGAN

                           COURT OF APPEALS



KEN HOLDINGS, L.L.C.,                                               UNPUBLISHED
                                                                    November 1, 2016
               Plaintiff-Appellant,

v                                                                   No. 325427
                                                                    Genesee Circuit Court
AUTO-OWNERS INSURANCE COMPANY,                                      LC No. 11-095991-CK
MICHAEL J. KAPTURE, and AMERICA ONE
KAPTURE INSURANCE AGENCY, INC., also
known as KAPTURE INSURANCE AGENCY,
INC.,

               Defendants-Appellees.


Before: METER, P.J., and SHAPIRO and O’BRIEN, JJ.

O’BRIEN, J. (concurring in part and dissenting in part).

        I write separately to express my disagreement with the majority’s ultimate conclusion—
that no genuine issue of material fact remains as to whether KEN Holdings, L.L.C., is entitled to
coverage under Clause C. The majority justifies this conclusion, in pertinent part, by stating that
“Auto-Owners intended to sell the entire Endorsement, and the insured intended to buy the entire
Endorsement with coverage under all three clauses.” I do not believe there is a dispute as to
whether the parties were buying and selling partial endorsements. Instead, I believe there is a
dispute as to whether the parties intended that Clause B or Clause C apply to KEN Holdings, and
this Court has already explained why the insurance contract at issue is ambiguous in this regard.
See KEN Holdings v Auto-Owners Ins Co, unpublished opinion per curiam of the Court of
Appeals, issued June 26, 2014 (Docket No. 312894), pp 4-6. Rather than reverse and remand
again, however, the majority concludes that the parties intended that Clause C, not Clause B,
apply to KEN Holdings as a matter of law. The only support for this conclusion in the insurance
contract is the presence of KEN Holdings with the notation “Interest: Loss Payable” in the
commercial property coverage declaration, and this Court has already “conclude[d] that the
insurance contract is ambiguous regarding what effect, if any, the notation ‘Interest: Loss
Payable,’ has on KEN Holdings’ right to recover under the contract even if HCSL is not entitled
to coverage.” KEN Holdings, unpub op at 5. On remand, Auto-Owners presented testimony
that, had the contracting parties intended Clause C, not Clause B, to apply, they would have




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designated KEN Holdings’ interest as that of a “Lender’s Loss Payee,” not a “Loss Payee.”
KEN Holdings presented testimony to the contrary. I believe that the factfinder must resolve this
factual dispute.1 Rather than allow the factfinder to do so, however, the majority concludes, as a
matter of law, that “the intent of the parties is clear” based on the price of the insured’s
premium.2 I do not believe the well-established rules of contract interpretation in this state allow
such a conclusion.3 Accordingly, I would reverse the trial court’s grant of summary disposition
to Auto-Owners, affirm the trial court’s denial of summary disposition to KEN Holdings, and
remand this matter for further proceedings with respect to Auto-Owners’ liability, if any.4




                                                             /s/ Colleen A. O’Brien




1
 I agree with the majority’s statement that the additional testimony presented by the parties did
not resolve the ambiguity.
2
  Specifically, the majority explains that, had Auto-Owners desired to have only Clause C apply,
it should have offered an endorsement with only Clause C. But, the majority continues, because
it offered the entire “Loss Payable Provisions” Endorsement as one endorsement with one
premium, the parties intended that there be coverage under all three clauses.
3
 In my view, the majority’s opinion reflects the application of the rule of contra proferentem,
which allows the factfinder, not this Court, to find in favor of the nondrafter “only after all
conventional means of contract interpretation, including the consideration of relevant extrinsic
evidence, have been applied and found wanting.” Klapp v United Ins Group Agency, Inc, 468
Mich 459, 472 NW2d 447 (2003).
4
 I agree with the majority’s conclusion that a remand to a different trial judge is not required
under the facts and circumstances of this case.


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