Auto negligence; Effect of defendant’s bankruptcy discharge; 11 USC § 524(a); In re Jet Florida Sys, Inc (11th Cir); Pursuit of the case for purposes of collecting uninsured motorist (UM) coverage from plaintiff’s own insurer; Andreson v Progressive Marathon Ins Co

The court held that the trial court erred in dismissing plaintiff’s motion for judgment based on “defendant’s bankruptcy discharge and the fact that plaintiff did not include his insurer as a party” where he sought to collect UM benefits. The parties were involved in an auto accident. While this negligence action was pending, defendant filed for Chapter 7 bankruptcy. Plaintiff moved for relief from the automatic stay so he could “continue his action against defendant for purposes of collecting” UM coverage from his own insurer. The bankruptcy court granted his motion. Plaintiff later was granted summary disposition in this action. But when he moved for entry of judgment, defendant opposed the motion and the trial court denied it. He argued that the trial court erred because the bankruptcy discharge did not preclude him “from continuing his negligence action for insurance purposes.” The court agreed. He had “explicitly stated that he only seeks a judgment against defendant to permit his recovery under his [UM] policy and, notably, the bankruptcy court granted plaintiff relief from the stay during the bankruptcy proceedings for that purpose.” UM coverage in Michigan is governed by the applicable policy’s provisions. Plaintiff’s policy provides “that the insurer ‘will pay compensatory damage which an “insured” is legally entitled to recover from the owner or operator of an’” uninsured vehicle due to bodily injury. Thus, “in light of the well-established principle that a plaintiff may proceed against a discharged debtor to establish liability to recover from an insurer,” the court held that the trial court erred in “denying plaintiff’s motion for judgment on the basis of defendant’s bankruptcy discharge.” As to his failure to name his insurer as a party, his “policy, at most, requires his insurer’s consent before seeking a judgment for damages, if plaintiff seeks to bind his insurer—there is no requirement that his insurer is a party to the lawsuit.” Vacated and remanded for “the trial court to properly consider the amount of damages owed to plaintiff.”