No-fault insurance; PIP benefits; Pedestrian injury; Resident relative; MCL 500.3114(1); MCL 500.3115; Rescission; Material misrepresentation; Innocent third party; Equitable balancing; Bazzi v Sentinel Ins Co; Sherman v Progressive MI Ins Co; Pioneer State Mut Ins Co v Wright; Medical provider claim; MCL 500.3112; MCL 500.3172; Michigan Automobile Insurance Placement Facility (MAIPF); Michigan Assigned Claims Plan (MACP)

The court held that the trial court did not abuse its discretion by declining to extend rescission of the no-fault policy to plaintiff or intervening plaintiff, and that the MAIPF was not liable while defendant-CURE’s policy remained applicable. Plaintiff was injured as a pedestrian and sought PIP benefits as a domiciled relative of the named insured, who had materially misrepresented household members and vehicle ownership in her application. The court first held that rescission was not required as to plaintiff. Although CURE “made a ‘diligent effort . . . to discover contradictions or omissions” in the application and plaintiff could alternatively seek benefits through the MAIPF, the record showed no evidence plaintiff knew of the misrepresentations and no evidence she acted recklessly or negligently in the accident. Because CURE bore the burden to show rescission was warranted, the trial court’s refusal to rescind as to plaintiff was within the range of reasonable outcomes. The court next held that rescission did not bar intervening plaintiff-DMC’s provider claim because the Legislature amended the No-Fault Act to “explicitly allow medical providers to bring direct actions” against insurers, and CURE failed to show the equities favored rescission as to DMC. Finally, because applicable personal protection insurance existed through CURE, plaintiff and DMC could not recover through the MACP, which applies only when “[n]o personal protection insurance is applicable to the injury.” Affirmed.