In Frownfelter v Esurance Prop and Casualty Ins Co, No 168356, ___ Mich ___, ___ NW3d ___ (July 22, 2026), the Michigan Supreme Court overruled its earlier decision in Grange Ins Co v Lawrence, 494 Mich 475, 835 NW2d 363 (2013), holding that a custody order alone cannot set a child’s domicile for purposes of the No-Fault Act.
Facts
Plaintiff was injured in an automobile accident at age 15 while riding as a passenger in a vehicle driven by her brother and owned by her father. Her father was insured under policies issued by Esurance Property and Casualty Insurance Company, Progressive Michigan Insurance Company, and Farmers Insurance Company. Plaintiff had spent the night before the accident at her father’s home. Although her parents shared joint custody, plaintiff lived with her mother approximately 75 percent of the time. Her mother was insured by Auto-Owners Insurance Company. A dispute arose regarding which insurer was highest priority to pay no-fault benefits. Plaintiff filed suit against Esurance, and Esurance filed a third-party complaint against Progressive, Farmers, and Auto-Owners. Esurance moved for summary disposition, arguing that plaintiff was domiciled with her mother, making Auto-Owners the highest priority insurer under MCL 500.3114(1). The trial court denied Esurance’s motion and granted Auto-Owners’ request for judgment under MCR 2.116(I)(2). Plaintiff also filed a separate action against her father and his insurers seeking noneconomic damages under MCL 500.3135. The parties disputed whether a step-down provision in the Esurance policy applied that would lower bodily injury liability coverage from $250,000 to $20,000. Plaintiff moved for summary disposition on that issue, arguing that the provision did not apply because she was not a resident of her father’s home at the time of the accident. The trial court denied plaintiff’s motion for summary disposition. The court of appeals affirmed each of the trial court’s rulings.
Holding
The supreme court held that a custody order does not determine a child’s domicile for purposes of the No-Fault Act, overruling Grange Ins Co v Lawrence, 494 Mich 475, 835 NW2d 363 (2013). A custody order can serve as a starting point in determining a child’s domicile, but if the child’s actual living arrangements are clearly inconsistent with the family court’s orders, those orders should not be considered to dispositively show the child’s domicile. Instead, courts should look to the factors for determining domicile for purposes of no-fault insurance in Workman v Detroit Auto Inter-Ins Exch, 404 Mich 477 (1979) and Dairyland Ins Co v Auto-Owners Ins Co, 123 Mich App 675 (1983). Courts should also consider where the child actually spends the majority of their time and where the child actually sleeps most nights of the week, among other factors. The judgment of the court of appeals was vacated with respect to both the holding that plaintiff was domiciled with her father at the time of the accident and the holding that plaintiff was a resident of her father’s home at that time for purposes of the step-down provision in his Esurance policy, and the case was remanded to the trial court for further proceedings.