                           STATE OF MICHIGAN

                           COURT OF APPEALS


COX III, LLC, and ANDRE LEON QUEEN,                                UNPUBLISHED
                                                                   April 12, 2018
              Plaintiffs-Appellees,

v                                                                  No. 336777
                                                                   Wayne Circuit Court
FARMERS INSURANCE COMPANY, INC.,                                   LC No. 15-010122-CK

              Defendant-Appellant,

and

FARMERS INSURANCE EXCHANGE,

              Defendant.


Before: SAWYER, P.J., and HOEKSTRA and MURRAY, JJ.

PER CURIAM.

        In this insurance coverage action, defendant1 appeals as of right a stipulated order
granting damages to plaintiffs, Cox III, LLC, and Andre Leon Queen. However, defendant’s
issue on appeal arises out of two prior orders granting summary disposition to plaintiffs. We
reverse.

        This action arises out of a car accident involving plaintiff, Andre Leon Queen (“Queen”),
while he was delivering sandwiches for plaintiff, Cox III, LLC (“Cox III”), a Jimmy John’s
franchisee. Queen hit another driver with his car, and the driver filed a personal injury lawsuit
against plaintiffs. Queen’s vehicle was insured by defendant through a policy that was issued to
Queen’s father. Plaintiffs sought coverage and indemnification through the automobile
insurance that Queen retained through defendant. Defendant was required to defend and
indemnify Queen up to the insurance policy limit of $50,000. Defendant declined to cover



1
  Farmers Insurance Exchange was dismissed as a defendant in a stipulated order granting
dismissal and does not participate in this appeal. All references to defendant herein are
references to Farmers Insurance Company, Inc.


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plaintiffs based on two exclusions in Queen’s automobile insurance policy. The exclusions are
as follows:

       This coverage does not apply to:

              1. Bodily injury or property damage arising out of the ownership,
       maintenance or use of a vehicle while used to carry persons or property for a
       charge. This exclusion does not apply to shared expense car pools.

                                              * * *

               6. Bodily injury or property damage arising out of the ownership,
       maintenance or use of any vehicle by any person employed or otherwise engaged
       in a business . . . . This exclusion does not apply to the maintenance or use of a:

               a. Private passenger car

               b. Utility car that you own if rated as a private passenger car, or

               c. Utility trailer used with a vehicle described in a. or b. above.

        Additionally, an amendment to the applicable exclusions states that Exclusion #6 applies
to any vehicle “[w]hile used in employment by any person whose primary duties are the delivery
of products or services . . . .”

       Plaintiffs alleged two causes of action in their initial complaint. Count I of plaintiffs’
complaint alleged that defendant’s denial of coverage constituted a breach of contract. Count II
of plaintiffs’ complaint sought declaratory relief, and requested that the trial court find that
defendant was obligated to defend and indemnify plaintiffs. Defendant filed a motion for
summary disposition, and plaintiffs filed a counter-motion for summary disposition. Following
the correction of an error in the original order, Count II was disposed of in a revised order
granting plaintiffs’ motion for summary disposition, in which the trial court stated that defendant
was obligated to defend and indemnify plaintiffs because neither of the contested exclusions
applied to plaintiffs. After the disposition of Count II, plaintiffs and defendant both moved for
summary disposition regarding Count I. The trial court found that defendant breached its
insurance contract with plaintiffs, and Count I was disposed of in a separate order granting
summary disposition to plaintiffs.

        Defendant argues that the trial court erred in granting summary disposition in favor of
plaintiffs because both Exclusion #1 and Exclusion #6 preclude coverage of plaintiffs for the
lawsuit that arose out of Queen’s car accident. We agree with regard to Exclusion #1.

       This Court reviews the grant or denial of a motion for summary disposition de novo.
Arias v Talon Dev Group, Inc, 239 Mich App 265, 266; 608 NW2d 484 (2000). “A motion
brought under MCR 2.116(C)(10) tests the factual support for the plaintiff’s claim.” Id. This
Court considers the “pleadings, admissions, and other evidence submitted by the parties in the
light most favorable to the nonmoving party.” Latham v Barton Malow Co, 480 Mich 105, 111;
746 NW2d 868 (2008). “Summary disposition is appropriate if there is no genuine issue

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regarding any material fact and the moving party is entitled to judgment as a matter of law.” Id.
A genuine issue of material fact “exists when the record, giving the benefit of reasonable doubt
to the opposing party, leaves open an issue upon which reasonable minds might differ.” West v
General Motors Corp, 469 Mich 177, 183; 665 NW2d 468 (2003).

       Defendant first argues that Exclusion #1, which excludes coverage for vehicles that are
used “to carry persons or property for a charge,” is not an ambiguous provision, and that it
precludes coverage of plaintiffs because the delivery of sandwiches amounts to carrying property
for a charge. The language of an insurance policy is construed and interpreted in accordance
with ordinary contract construction principles. Citizens Ins Co v Pro-Seal Service Group, Inc,
477 Mich 75, 82; 730 NW2d 682 (2007). The question whether the language of a contract is
ambiguous is a question of law that this Court reviews de novo. Casey v Auto Owners Ins Co,
273 Mich App 388, 394; 729 NW2d 277 (2006). The trial court found that the language of
Exclusion #1 was ambiguous because the exclusion did not appropriately define what “carrying a
person or property for a charge” included, or indicate whether delivering sandwiches constituted
carrying property for a charge.

        However, this Court has found that a similar arrangement, where an individual was paid a
wage to deliver pizzas using his personal car, amounted to carrying property for a charge.
Amerisure Ins Co v Graff Chevrolet, Inc, 257 Mich App 585, 596; 669 NW2d 304 (2003), rev’d
in part on other grounds 469 Mich 1003 (2004). In Amerisure, an employee of a company
insured by the plaintiff got into a car accident while delivering pizzas. Id. at 587. The
employee’s fiancée had rented the car, and placed the employee on the rental contract as a
permissive user of the car. Id. The employee was sued by the other driver. Id. The plaintiff and
the defendant both contributed $90,000 to the settlement of the case against the employee, and
the plaintiff then sued the defendant, seeking a declaratory judgment that the defendant was
responsible for the payment of the entire settlement. Id. at 587-588. This Court found that the
rental contract provided by the defendant “was also, in a way, an insurance contract,” because it
provided insurance coverage. Id. at 594.

        The rental contract in Amerisure contained an exclusion that precluded insurance
coverage where the car was used “to carry . . . property for consideration . . . .” Id. at 587. The
plaintiff argued that, because the employee was “paid a wage for whatever work he did and did
not receive a special wage or mileage reimbursement for carrying pizzas, he did not carry
property for consideration.” Id. at 595. The employee was paid an hourly wage and received
tips for pizza deliveries. Id. at 596. This Court found that the employee’s hourly wage
constituted consideration within the meaning of the insurance policy, and “because [the
employee] was hired for the purpose of delivering pizzas, his transportation of those pizzas was
for consideration.” Id.

        In this case, Queen was an employee of Cox III’s Jimmy John’s franchise and delivered
sandwiches in return for hourly compensation, as well as tips. With the exception of the type of
food being delivered, the arrangement between plaintiffs is the same as the arrangement between
the employee and employer in Amerisure. In Amerisure, this Court did not differentiate between
a car rental contract and the type of automobile insurance contract that is typically issued to the
owner of a vehicle. Id. at 597. This Court ultimately held that the exclusion in the rental
contract, which closely mirrors the exclusion at issue in plaintiffs’ case, precluded insurance

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coverage for car accidents sustained while the insured’s car is being used to carry property in
exchange for an hourly wage. Id. Therefore, the language in Exclusion #1 is not ambiguous,
and plaintiffs are precluded from coverage because the accident occurred while Queen used the
vehicle to carry property for a charge.

        We need not determine whether Exclusion #6 applies because the trial court’s error in
determining whether the language of Exclusion #1 was ambiguous ultimately results in a
favorable outcome for defendant. “ ‘[C]overage under a policy is lost if any exclusion within the
policy applies to an insured’s particular claims.’ ” Michigan Battery Equipment, Inc v Emcasco
Ins Co, 317 Mich App 282, 285; 892 NW2d 456 (2016). Accordingly, plaintiffs should not have
been granted summary disposition because Exclusion #1 precludes insurance coverage for the
car accident that Queen was involved in.

       Reversed. Defendant may tax costs.



                                                           /s/ David H. Sawyer
                                                           /s/ Joel P. Hoekstra
                                                           /s/ Christopher M. Murray




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