Amerisure Insurance Co. v. DeBruyn Produce Co., 298 Mich. App. 137

Summary

The Michigan Court of Appeals held that an employee’s unauthorized issuance of additional checks to herself constituted embezzlement covered under the employee-dishonesty provision of the employer’s commercial insurance policy. The court concluded that the policy’s exclusion for salary and other employee benefits did not apply because the employer did not knowingly provide the funds as compensation.

Holdings

1. The additional checks were not salary or employee benefits earned in the normal course of employment because DeBruyn did not knowingly intend to issue them as compensation. Phillips's conduct was embezzlement and fell within the policy's employee-dishonesty coverage.
2. The trial court properly ruled that the policy covered DeBruyn's loss, and its order was affirmed.

Questions Presented

1. Whether Phillips's unauthorized issuance of additional checks from DeBruyn's payroll account constituted employee dishonesty covered by the commercial insurance policy.
2. Whether the policy exclusion for employee benefits earned in the normal course of employment, including salary and similar compensation, excluded coverage for Phillips's embezzlement.

Disposition

affirmed