eNotes: Liability – April 2023 – Pennsylvania

SIGNIFICANT CASE SUMMARIES

Pennsylvania Case Summaries

Erie Ins. Exch. v. Mione
Pennsylvania Supreme Court
No. 89 MAP 2021

Decided: February 15, 2023

Pennsylvania Supreme Court holds that the household exclusion remains valid where Plaintiff was injured while occupying a vehicle for which he had rejected UM/UIM coverage based on the rationale that it was not a matter of stacking because there was no first priority coverage

Background

In this UIM case, Mr. Mione was injured by a third party in an automobile accident while operating a motorcycle insured by Progressive. Mr. Mione had expressly rejected UM/UIM coverage under the Progressive policy. After recovering from the tortfeasor, Mr. Mione then sought UIM coverage from two Erie household auto policies, despite his rejection of UIM coverage under the Progressive policy. Erie denied UIM benefits arguing that the motorcycle was not listed on the automobile policy, was separately insured, and that the insured had expressly waived UIM benefits under the Progressive policy. Erie further argued that the litigation did not involve stacking, as in Gallagher, because there were no benefits upon which to stack with the household automobile policy. As such, the “household exclusion” applied and precluded Mr. Mione from recovering any benefits arising out of the operation of a vehicle which was not insured or listed in the Erie policy.

Holding

The Supreme Court reasoned that when an insured seeks UM/UIM benefits under a household policy but does not have UM/UIM coverage on the vehicle that he was occupying at the time of the collision, it cannot be said that a household vehicle exclusion in the UM/UIM containing policy is operating as the sort of disguised waiver of stacking that was disapproved in Gallagher. Rather, in such circumstances, the household vehicle exclusion serves as an unambiguous preclusion of all UM/UIM coverage (even unstacked coverage) for damages sustained while operating an unlisted household vehicle.

The Supreme Court rejected the view that household vehicle exclusions are ipso facto unenforceable. Importantly, the Court reasoned that “Gallagher did not undermine Eichelman’s central holding in that regard; it simply held that a household vehicle exclusion cannot conflict with Section 1738 by purporting to take away coverage that the law says is mandatory unless waived using a specific form. In cases where the exclusion does not interfere with the insured’s ability to stack UM/UIM coverage, Gallagher’s de facto waiver rationale is not applicable.”

Questions about this case can be directed to John Lucy at (717) 441-7067 or jlucy@tthlaw.com.

Marotto v. Hibner
Pennsylvania Superior Court
No. 202 WDA 2022

Decided: February 23, 2023

Jury was permitted to find lack of factual cause despite defense medical expert suggesting at least some injury was sustained.

Background

Hibner was operating her vehicle at a slow rate of speed while following Marotto on October 28, 2015. Hibner rear-ended Marotto’s vehicle. Neither vehicle was damaged. Marotto denied injuries at the scene of the accident and denied medical assistance. Marotto later sought medical attention from her chiropractor for pain in left shoulder and neck. Further, Marotto sought an emergency medical procedure for pain ten months later, where she was diagnosed with cervical radiculopathy. Shortly thereafter, Marotto filed a Complaint alleging injuries from the accident including cervical and lumbar strains and sprains.

A three-day jury trial ensued. During trial, Hibner’s medical expert testified, that using information from Marotto’s subjective complaints, he believed Marotto experienced some level of injury from the subject accident and that Marotto experienced pain which would be permanent and could potentially require ongoing interventions. However, Hibner’s medical expert clarified that there was no objective evidence of an injury upon exam or imaging. The jury returned a verdict which identified that Hibner’s negligence was not a factual cause of Marotto’s injuries. Marotto appealed the verdict as improper given Hibner’s expert conceding that an injury was caused by the accident, as improper as defense did not contest the fact that Marotto sustained some injury, and as against the weight of the evidence.

Holding

The Superior Court affirmed the judgment. The Court held that there was no abuse of discretion, nor was there an error of law. The Superior Court’s analysis explained that the experts’ agreement as to a factual cause of injury was not binding upon the jury, because there was contradictory evidence that Plaintiff complained of and treated for neck and shoulder pain symptoms prior to the accident. The Superior Court continued, explaining that because Marotto’s credibility was at direct issue, so were the two expert’s opinions based upon Marotto’s communications of her own injuries. The Superior Court held that the jury properly executed their judgment in making a credibility determination, and accordingly, the verdict was not so contrary to the evidence that it shocked one’s sense of justice.

Questions about this case can be directed to Logan Nagle at (717) 255-7234 or lnagle@tthlaw.com.

Waldinger v. Wokulich
Pennsylvania Superior Court
No. 478 WDA 2023

Decided: February 15, 2023

Whether a surgical scar constitutes a serious permanent disfigurement for breaching limited tort threshold is genuine issue of material fact left to the factfinder.

Background

Plaintiff and Defendant were involved in a motor vehicle accident. Plaintiff was governed by the limited tort alternative. Following the accident, Plaintiff was treated at a hospital for her knee, chest and right wrist and hand, which were her dominant side. She treated with a chiropractor for four months, received injections to her wrist, and ultimately had surgery to her right wrist which resulted in a two inch scar. Plaintiff testified to how the injuries and scar affected her daily life, and how they did not affect her work or recreation. Plaintiff’s expert report opined that Plaintiff had made a good recovery, required no further treatment, and had an excellent prognosis, but did not discuss how the injuries affected her life. Defendant filed a Motion for summary judgment arguing that her injuries did not breach the “serious injury” threshold.

The Trial Court granted summary judgment, concluding that she did not sustain a serious impairment of a body function. On appeal, the Superior Court held that there was no error on the claim of “serious injury” because the objective evidence did not support Plaintiff’s subjective claims on how the injuries impacted her life. The Court held that the Trial Court erred in determining that the Plaintiff’s scar from her surgery was not a serious permanent disfigurement. The Trial Court considered the impact the scar had on the Plaintiff’s life, not the effect on her appearance. The Court concluded that the inquiry is the effect on the person’s appearance. Medical evidence is not necessary to determine whether a scar impacts one’s appearance. In this case, a question for the jury existed because reasonable minds could differ as to whether Plaintiff’s scar constitutes a serious permanent disfigurement.

Holding

The Court reversed the order of judgment and remanded the case for further proceedings so that a factfinder could determine whether Plaintiff was entitled to non-economic damages based upon the question of whether her scar breached the limited tort threshold.

Questions about this case can be directed to James F. Swartz, III at (610) 332-7028 or jswartz@tthlaw.com.

Loftus v. Decker
Pennsylvania Superior Court
2023 Pa. Super. 214

Decided: February 1, 2023

Superior Court holds that there is no cause of action for negligent spoliation of evidence under the theory of promissory estoppel.

Background

Loftus was injured in an automobile accident in the course and scope of her employment with Tri-County Transportation. She sought worker’s compensation benefits from Tri-County’s worker’s compensation carrier, Eastern Alliance Insurance Group. She settled her worker’s compensation case and, as part of the settlement, Eastern Alliance retained its absolute right to statutory subrogation of the $196,093.34 paid to Loftus. Thereafter, Loftus filed a Writ of Summons against Decker, the culpable driver, seeking civil damages for her injuries.

Although Loftus had not yet filed a Complaint, Eastern Alliance filed a Petition to intervene to protect its subrogation rights. In the Petition, Eastern Alliance alleged that Loftus refused to accept the $25,000 offered by Decker to settle the case unless Eastern Alliance would compromise the lien and, instead, Loftus was willing to abandon the litigation against Decker.

The Trial Court denied Eastern Alliance’s Petition to intervene, finding that as Loftus had not filed a verified complaint setting forth the facts supporting the cause of action, the Court could not determine the merits of Eastern Alliance’s Petition to intervene. In other words without a Complaint by Loftus, it was impossible for Eastern Alliance to demonstrate the existence of a legally enforceable interest. The Trial Court also determined that the decision was not an appealable collateral order. Despite this determination of the Trial Court, Eastern Alliance filed an appeal to the Superior Court. A panel of the Superior Court quashed the appeal, but Eastern Alliance’s Application for re-argument en banc was granted.

Holding

On re-argument, the Superior Court determined that the Order denying Eastern Alliance’s Petition to intervene had to satisfy all three prongs of the test under Pa.R.A.P. 313(b) to be considered a collateral appealable order. After determining that the Order was separable from the Loftus’ tort claim, the Superior Court determined that it did not meet the second prong of being a right “too important to be denied review.” The Court agreed with the Trial Court that without a complaint, the record did not contain sufficient information to determine whether Eastern Alliance’s intervention was proper under the rules. Simply, as Eastern Alliance did not have a legal interest or a right to protect, it could not be shown that there was a right too important to be denied collateral review. In doing so, the Superior Court noted that the law provides that only Loftus, and not Eastern Alliance, could pursue a direct action against the tortfeasor and that Eastern Alliance had no right to compel Loftus to do so. Under these circumstances, the Superior Court en banc quashed the appeal.

Questions about this case can be directed to Rebecca Sember-Izsak at (412) 926-1446 or rsember@tthlaw.com.

Yoder v. McCarthy Constr., Inc.
Pennsylvania Superior Court
2023 Pa. Super. 13

Decided: January 31, 2023

Injured employee of subcontractor could not defeat contractor’s statutory employer immunity by claiming independent contractor status after receiving workers’ compensation benefits from the subcontractor.

Background

Defendant was contracted to remove and replace the roof of a public library, and subcontracted part of the work to the roofing company (RRR) for which Plaintiff worked. Plaintiff fell through a hole in the roof and was injured. He filed a workers’ compensation claim against RRR and sued Defendant for negligence. In response to Plaintiff’s Original Complaint, Defendant pled that the claim was barred by the exclusivity provision of the Workers’ Compensation Law. Defendant later moved for summary judgment on the basis that it was immune from suit under the statutory employer doctrine, without having responded to an Amended Complaint filed more than a year earlier. After moving for summary judgment, Defendant filed an Answer to the amended pleading asserting all available defenses under the Workers’ Compensation Law. The Trial Court denied summary judgment to Defendant, and granted Plaintiff’s Motion to strike the untimely Answer and Motion in limine to preclude evidence regarding the statutory employer defense on the basis that it had been waived. The Trial Court further denied Defendant’s Motions for nonsuit and directed verdict raising the statutory employer issue. The jury returned a $5 million verdict in favor of Plaintiff, and Defendant moved for judgment notwithstanding the verdict (“JNOV”), which the Trial Court denied. The Trial Court filed an Opinion indicating that Defendant’s Motions were denied for failure to establish the fifth element of the defense (which requires that plaintiff is an employee of the subcontractor) because Plaintiff was an independent contractor of RRR.

The Superior Court emphasized the non-waivable nature of the statutory employer defense, which affects the existence of subject matter jurisdiction and can thus be raised at any time by the defendant or by the court itself. Regarding the fifth element of the defense, the Superior Court held that Plaintiff was judicially estopped from disputing his status as an employee of the subcontractor on the basis that he had sought and obtained workers’ compensation from RRR based upon representations that RRR was his employer. The Superior Court further held that the other four elements of the statutory employer defense were met, in that Defendant was under contract with the owner of the library; Defendant occupied or controlled the part of the library premises where the injury occurred; Defendant had a subcontract with RRR; and Defendant entrusted to RRR part of the work for which it was responsible under its contract with the owner.

Holding

The Superior Court, while expressing its displeasure with disturbing the jury’s verdict, held that the law compelled the verdict in Plaintiff’s favor to be reversed and judgment to be entered in favor of Defendant.

Questions about this case can be directed to Karin M. Romano at (412) 926-1426 or kromano@tthlaw.com.

Erie Ins. Exch. v. Matthews
Pennsylvania Superior Court
2023 Pa. Super. Unpub. LEXIS 206, 2023 WL 384234

Decided: January 25, 2023

A change in the company name, from Ion Construction LLC to Ion Construction, Inc., on an automobile insurance policy, did not create a second policy requiring a new form rejecting UIM coverage.

Background

In 2015, Erie issued a policy to Ion Construction LLC, insuring a 2003 Chevrolet Avalanche. Alexander Matthews, who was then the vice president of the LLC, signed a form rejecting UM and UIM coverage. Subsequently, the company changed its name for tax and liability purposes. In 2016, Erie was notified of the name change. In February of that year, amended declarations were issued making the name change, but retaining the same policy number and the same coverages. Erie did not request a new waiver of UM and UIM coverage, none was provided per the declarations, and no premium was charged for any such coverage. In April of 2017, Jason Matthews (the father of Alexander and a company officer) was injured while driving the Avalanche. He made a claim for UIM benefits, which Erie denied. Erie filed a declaratory judgment action contending that no UIM benefits were available under the policy because the corporate name change did not give rise to a new policy requiring a new UIM rejection form. The Trial Court disagreed and entered summary judgment against Erie. In an interlocutory appeal, the Superior Court reversed and remanded the case with instructions to enter summary judgment in favor of Erie.

Holding

The Superior Court held that the change in the name of the corporate insured did not create a new entity, nor did it affect the corporation’s property, rights or liabilities. The amended declarations of the policy used the same policy number, provided the same coverages, and involved no increase in premiums. The former waiver of UM and UIM coverage was still effective and the company thus enjoyed the same savings on premiums by rejecting UM and UIM coverage, and allowing such coverage now would reward the company for its inaction in adding such coverage. The Appellate Court relied upon a number of cases in which the name of the insurer had changed without otherwise creating a new policy with any changes in coverages or premiums. Thus, the Superior Court rejected Jason Matthews’ contention that a new waiver of UM and UIM coverage was required following the corporate name change.

Questions about this case can be directed to Louis Long at (412) 926-1424 or llong@tthlaw.com.