Detroit Automobile Inter-Insurance Exchange v. United Bonding Insurance

Michigan Court of Appeals

Detroit Automobile Inter-Insurance Exchange v. United Bonding Insurance

166 N.W.2d 651, 15 Mich. App. 481, 1969 Mich. App. LEXIS 1497

CourtMichigan Court of Appeals

DecidedJanuary 27, 1969

DocketDocket No. 4,158

StatusPublished

Cited by1 cases

This text of 166 N.W.2d 651 (Detroit Automobile Inter-Insurance Exchange v. United Bonding Insurance) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Detroit Automobile Inter-Insurance Exchange v. United Bonding Insurance, 166 N.W.2d 651, 15 Mich. App. 481, 1969 Mich. App. LEXIS 1497 (Mich. Ct. App. 1969).

Pincite

Opinion

Per Curiam:.

Plaintiff in this case first started an action against Regional Credit Bureau for conver[482]*482sion, which resulted in a judgment. Regional Credit proved to he uncollectible. At this point plaintiff brought an action for recovery under a statutory collection agency bond, posted by the defendant herein for the Credit Bureau. Defendant interposed three defenses: election of remedy in that plaintiff sued on a promissory note, which evidenced an agreed shortage; novation, in that plaintiff brought suit against the collection agency without joining¹ the bonding company, defendant herein; and accord and satisfaction, in that plaintiff obtained a judgment against the collection agency only and exhausted its post-judgment collection proceedings thereon.

The statute¹ controls and provides in part:

“This remedy shall not be considered as exclusive but in addition to all other remedies provided by law in such cases.”

Election of remedies, novation, accord and satisfaction have no effect under this statute. The construction of this statute is, that when all else fails, there is still protection under the statutory bond. CLS 1961, § 445.204 (Stat Ann 1964 Rev § 19.655[4]) provides the specific authority to sue the bonding company when there is a loss resulting from a violation of the statute, regardless of any intermediate attempts to settle or reduce the amount. If there is a loss and it remains, the bond is available. It is the' plain provision of the statute that the remedy under the bond is not exclusive, but is in addition to all other remedies provided by law in such cases.

The purpose is to protect the public in dealing with a collection agency from losses occasioned by a conversion of funds. It was the obvious intent of the legislature in enacting the statute that sureties [483]*483would become responsible under the bond for such losses. Any other construction would disregard the legislative intent and defeat one of the main reasons for its enactment.

Under the statute, defendant United Bonding Insurance Company is liable under its bond to the plaintiff.

Affirmed. Costs to appellee.

McGregor, P. J., and Fitzgerald and J. H. Gillis, JJ., concurred.

Free access — add to your briefcase to read the full text and ask questions with AI

Per Curiam:.

Plaintiff in this case first started an action against Regional Credit Bureau for conver[482]*482sion, which resulted in a judgment. Regional Credit proved to he uncollectible. At this point plaintiff brought an action for recovery under a statutory collection agency bond, posted by the defendant herein for the Credit Bureau. Defendant interposed three defenses: election of remedy in that plaintiff sued on a promissory note, which evidenced an agreed shortage; novation, in that plaintiff brought suit against the collection agency without joining¹ the bonding company, defendant herein; and accord and satisfaction, in that plaintiff obtained a judgment against the collection agency only and exhausted its post-judgment collection proceedings thereon.

The statute¹ controls and provides in part:

“This remedy shall not be considered as exclusive but in addition to all other remedies provided by law in such cases.”

Election of remedies, novation, accord and satisfaction have no effect under this statute. The construction of this statute is, that when all else fails, there is still protection under the statutory bond. CLS 1961, § 445.204 (Stat Ann 1964 Rev § 19.655[4]) provides the specific authority to sue the bonding company when there is a loss resulting from a violation of the statute, regardless of any intermediate attempts to settle or reduce the amount. If there is a loss and it remains, the bond is available. It is the' plain provision of the statute that the remedy under the bond is not exclusive, but is in addition to all other remedies provided by law in such cases.

The purpose is to protect the public in dealing with a collection agency from losses occasioned by a conversion of funds. It was the obvious intent of the legislature in enacting the statute that sureties [483]*483would become responsible under the bond for such losses. Any other construction would disregard the legislative intent and defeat one of the main reasons for its enactment.

Under the statute, defendant United Bonding Insurance Company is liable under its bond to the plaintiff.

Affirmed. Costs to appellee.

McGregor, P. J., and Fitzgerald and J. H. Gillis, JJ., concurred.

Cite This Page — Counsel Stack

Bluebook (online)

166 N.W.2d 651, 15 Mich. App. 481, 1969 Mich. App. LEXIS 1497, Counsel Stack Legal Research, https://law.counselstack.com/opinion/detroit-automobile-inter-insurance-exchange-v-united-bonding-insurance-michctapp-1969.

Opinion

Related

Cite This Page — Counsel Stack