Garnishment action by one insurer against another; Collateral estoppel; Wilcox v Sealey; Res judicata; Privity; Cloud v Vance; Effect of failing to pursue appellate review of the order denying a motion to intervene in a related declaratory judgment action; Whether the garnishment action was a “collateral attack” on the settlement in the declaratory judgment action; Workers’ Comp Agency Dir v MacDonald’s Indus Prod, Inc (On Reconsideration); Coverage under a homeowner’s policy; “Resident”; Grange Ins Co of MI v Lawrence

The court held that neither collateral estoppel nor res judicata applied to bar third-party plaintiff-Allstate’s current garnishment action against garnishee defendant-Pioneer. Further, the fact Allstate did not pursue appellate review of an order denying its motion to intervene in Pioneer’s declaratory judgment action against third-party defendant-Odeh did not render this garnishment action an impermissible collateral attack on the settlement in that case. Finally, the trial court did not err in granting Allstate summary disposition as to whether Odeh had coverage under his mother’s Pioneer homeowner’s policy. The home of Allstate’s insured, plaintiff-Muha, was destroyed by fire. It was “highly contested” whether Odeh resided there or in his mother’s home. After Muha sued Allstate, it filed “a third-party subrogation complaint against Odeh based on negligence.” He forwarded it to Pioneer seeking to have it defend and indemnify him. Pioneer did not name Allstate, Muha, or his mother as defendants in its declaratory judgment action against him. After receiving the “final order” in that action, Allstate unsuccessfully moved to intervene and to set it aside. Following a bench trial on its third-party complaint, Odeh was found liable to Allstate and a judgment was entered. It then filed a request and writ for garnishment on Pioneer. On appeal, the court determined that the second element of collateral estoppel was not met here because “Pioneer’s deliberate actions denied Allstate a full and fair opportunity to litigate the issue of Odeh’s coverage under the Pioneer policy.” As to res judicata, Allstate was not a party to the declaratory judgment action, and it was not in privity with Odeh. The court found Cloud “dispositive. Pioneer knew of Allstate’s claim against Odeh, yet it did not provide meaningful notice to Allstate. Allstate was denied the right to intervene, and deprived of a full and fair opportunity to litigate the question of whether Odeh resided in his mother’s home and” thus, was insured under her policy. Further, Pioneer did not persuasively explain “how this garnishment action constituted an impermissible collateral attack of” a trial court order. Lastly, “the trial court did not err by finding that Odeh simultaneously maintained two residences, one of them being the home that he shared with his mother. As such, he is an ‘insured’ under the plain language of the” Pioneer policy. Affirmed.