In the matter of Muzafer Isovska v Fitzpatrick, USAU, Progressive, MAIPF, Court of Appeals docket number 368902, published opinion (Oct. 30, 2025), Shareholder, Mark Nawrocki of Anselmi Mierzejewski Ruth & Sowle, PC successfully argued on behalf of the MAIPF.
Plaintiff was the named insured on a USAU policy for her Toyota Yaris. Plaintiff’s daughter, Brianna, owned a Ford Focus that was insured with Progressive. Plaintiff was also the registrant of the Ford Focus. Plaintiff was involved in a motor vehicle accident while operating the Ford Focus. Her claim with Progressive was denied as Progressive rescinded the policy, ab initio, due to Brianna failing to disclose that she lived with her mother/Plaintiff. Plaintiff’s claim with USAU was also denied for two reasons: 1) the Plaintiff was the registrant of the Ford Focus and it was not insured with USAU, and 2) the Plaintiff was the registrant of an uninsured vehicle involved in the motor vehicle accident as progressive rescinded its policy, Sec 3113(b).
Progressive argued that its policy should be rescinded due to the material misrepresentation in the application process. USAU argued that: 1) the Plaintiff was the registrant of the Ford Focus and it was not insured with USAU (policy Exclusion D), and 2) the Plaintiff was the registrant of an uninsured vehicle involved in the motor vehicle accident as Progressive rescinded its policy, Sec 3113(b) (policy exclusion E). MAIPF argued that Plaintiff either obtained coverage from Progressive based on a resident relative theory of Sec. 3114(1) or alternatively, that Plaintiff was the registrant of an uninsured vehicle, (Sec. 3113(b)). The trial court granted all of the Defendants filed dispositive motions and Plaintiff appealed.
Because Progressive wanted to rescind its policy, the Court of Appeals had to balance the equities as they applied to the Plaintiff as a third-party to the policy. The Court found that Progressive did not produce evidence to conclusively demonstrate that the Plaintiff was aware of the alleged fraud in the application and vacated the trial court’s order granting Progressive’s dispositive motion. The Court found that USAU policy exclusion “D” violated the No-Fault Act and was invalid. However, in dicta, as to USAU’s exclusion “E”, the Court examined the Michigan Supreme Court’s ruling in Wilmore-Moody v Sentinel Ins Co¸ 502 Mich 390 (2018) and concluded that rescission/voiding a policy ab-initio, is a legal fiction between the contracting parties and a third-party to that contract cannot rely on the rescission. As such, the rescission “does not alter reality or act as a DeLorean time machine” or “create an alternative reality.”
Despite the policy being rescinded ab-initio, the vehicle was insured at the time of the motor vehicle accident. The Court did not rule on the rescission issue as there were material facts in dispute surrounding Progressive’s rescission. The Court reversed the trial court’s granting of USAU’s dispositive motion as to PIP benefits. Lastly, as to MAIPF’s dispositive motion, the Court affirmed the trial court’s ruling as MAIPF correctly argued that either of its potential outcomes set forth in its Motion would preclude liability on the part of the MAIPF.
The Court affirmed the trial court’s granting of the MAIPF’s dispositive motion.