McCollum v. Community Service Ins Co

In McCollum v. Community Service Ins Co, 137 Mich. App. 805; 359 N.W.2d 215 (1984), the decedent was a recently divorced mother who received welfare but was actively seeking employment. The decedent and her children lived in a house on the decedent's mother's farm with the understanding that the decedent would pay rent and utilities when she obtained employment. The decedent's mother also loaned her as much as $ 300 a month to meet the needs of her family. McCollum, 137 Mich. App. at 807-808. The defendant insurer argued that because the maternal grandparents continued to provide financial support and rent-free housing to the decedent's children after her death in an automobile accident, the children had not sustained an economic loss. However, the Court held that the amounts loaned by family members to the decedent to care for her children while she was unemployed were "contributions of tangible things of economic value" received from the decedent because the decedent "exercised her independent judgment upon how these funds could best be used to support her children." Id. at 811. Moreover, the funds were loans that the decedent had agreed to repay. Id. at 812. Because her children had lost "this guarantee of repayment security," they had suffered tangible economic loss compensable under the statute. Id.