Michigan Supreme Court Clarifies “Unlawful Taking” Bar to No-Fault Benefits
Swoope v. Citizens Insurance Co. of the Midwest, Michigan Supreme Court (March 10, 2026)
The Michigan Supreme Court recently clarified the proper interpretation of the unlawful-taking exclusion under Michigan’s No-Fault Act, MCL 500.3113(a).
The Court emphasized a critical distinction: the statute focuses on whether the vehicle was taken unlawfully, not whether it was operated unlawfully. Accordingly, unlawful operation alone, including driving without a valid license, does not automatically disqualify a claimant from recovering PIP benefits. The relevant inquiry is whether the claimant obtained possession of the vehicle unlawfully and knew or should have known that the taking was unlawful.
The Court reversed the Court of Appeals after concluding that the lower court had focused on the plaintiff’s unlawful operation of the vehicle rather than the statutory question of whether the vehicle had been unlawfully taken. The case was remanded for further proceedings addressing that issue.
The decision reinforces the statutory boundaries of MCL 500.3113(a). Courts must apply the statute as written, even where the outcome may appear difficult to reconcile with broader notions of fairness or accountability. Under the current framework, it remains possible for an unlicensed driver to recover PIP benefits even where that driver’s conduct contributes to serious injury.
Cases like this may prompt a broader policy discussion. The Legislature may wish to consider whether Michigan’s No-Fault Act should expressly bar PIP recovery by individuals operating a motor vehicle without a valid license, particularly in cases involving catastrophic injury to others.
Swoope v. Citizens Insurance Co. of the Midwest, Michigan Supreme Court (March 10, 2026)
The Michigan Supreme Court recently clarified the proper interpretation of the unlawful-taking exclusion under Michigan’s No-Fault Act, MCL 500.3113(a).
The Court emphasized a critical distinction: the statute focuses on whether the vehicle was taken unlawfully, not whether it was operated unlawfully. Accordingly, unlawful operation alone, including driving without a valid license, does not automatically disqualify a claimant from recovering PIP benefits. The relevant inquiry is whether the claimant obtained possession of the vehicle unlawfully and knew or should have known that the taking was unlawful.
The Court reversed the Court of Appeals after concluding that the lower court had focused on the plaintiff’s unlawful operation of the vehicle rather than the statutory question of whether the vehicle had been unlawfully taken. The case was remanded for further proceedings addressing that issue.
The decision reinforces the statutory boundaries of MCL 500.3113(a). Courts must apply the statute as written, even where the outcome may appear difficult to reconcile with broader notions of fairness or accountability. Under the current framework, it remains possible for an unlicensed driver to recover PIP benefits even where that driver’s conduct contributes to serious injury.
Cases like this may prompt a broader policy discussion. The Legislature may wish to consider whether Michigan’s No-Fault Act should expressly bar PIP recovery by individuals operating a motor vehicle without a valid license, particularly in cases involving catastrophic injury to others.
| swoope-v-citizens-insurance-michigan-supreme-court-no-fault-unlawful-taking-pip-benefits-2026.pdf.pdf |