Sixth Circuit Court Of Appeals Affirms Summary Judgment Obtained By Michael F. Schmidt In Insurance Policy Rescission Case

Mohammed Huda v Integon National Insurance Company, No. 08—2193(6th Cir, 2009), appeal from summary judgment granted by U. S. District Court Eastern District of Michigan in favor of Integon National Insurance Company that it properly rescinded an automobile insurance policy based on a material misrepresentation made by the insured in the application, by failing to disclose all household members who were of driving age including his son, Mohammed Huda, Jr. The plaintiff sustained catastrophic injuries including loss of his right eye in an auto accident. The Sixth Circuit agreed with our argument that under Michigan law an insurer can void a policy when there has been a material misrepresentation in the application. The insured claimed that he was not asked about other drivers in the household and did not fill out the page requesting this information. However, we argued that he signed the Applicant’s Certification which indicated that he had answered all of the questions in the application and that all persons of eligible driving age or permit age who lived with him as well as resided in his household had been shown in the policy. The court also rejected the plaintiff’s argument that Integon should be estopped and held to have waived the rescission by failing to assure that Huda had filled out the entire application including the Undisclosed Driver section. The court agreed with our argument that waiver and estoppel cannot be established by mere silence and that the plaintiff’s argument was contrary to the Applicant’s Certification. The court further rejected Huda’s argument that the misrepresentation could have been “ascertained easily” since Huda had disclosed a prior homeowner policy which also listed his wife as a household member. The court agreed with our argument that this did not establish any knowledge of Huda, Jr. and that the argument was based on Huda’s claim that failure to inform Integon about one driver in his household could be excused by his failure to inform Integon about another driver. The court also rejected Huda’s argument that the application was ambiguous.