Insurer must defend until questions of fact are resolved regarding permissive use
In auto cases in Michigan, there is a rebuttable statutory presumption that a driver is using another's motor vehicle with the owner's consent. Car insurance policies must be written to cover liability resulting from permissive use, and Michigan insurance policies are written to make the owner's policy apply before the operator's liability policy. In Citizens v. Secura v. Gillespie, the Court of Appeals held that the owner's insurer is obligated to defend a lawsuit until such time as the factual issue of consent has been resolved.
The case arose out of the negligent deaths of two innocent victims, and serious injuries to two others. The owner's insurer declined to participate or defend the resulting claims, arguing that the driver did not have the express or implied consent of his mother, the owner. The trial court had ruled against the insurer and the Court of Appeals affirmed the duty to defend, citing existing law enforcing the rebuttable presumption of consent until such time as the factual basis of consent is disproven.