Aetna Ins. Co. v. PENNSYLVANIA MANUFACTURERS ASS'N

• Citation: 456 F. Supp. 627
• Decision Date: 30 June 1978
• Docket Number: Civ. A. No. 76-2783.
• Parties: AETNA INSURANCE COMPANY v. PENNSYLVANIA MANUFACTURERS ASSOCIATION INS. CO., Publicker Industries, Inc., Salvatore Dejewski and Carol, h/w Joan Wexler, ADMX. of the Estate of Neil Wexler, Deceased.
• Court: U.S. District Court — Eastern District of Pennsylvania

456 F. Supp. 627

AETNA INSURANCE COMPANY v. PENNSYLVANIA MANUFACTURERS ASSOCIATION INS. CO., Publicker Industries, Inc., Salvatore Dejewski and Carol, h/w Joan Wexler, ADMX. of the Estate of Neil Wexler, Deceased.

Civ. A. No. 76-2783.

United States District Court, E. D. Pennsylvania.

June 30, 1978.

COPYRIGHT MATERIAL OMITTED

Albert L. Bricklin, Philadelphia, Pa., for plaintiff.

Michael Louis Brodie, Philadelphia, Pa., for Publicker.

James E. Beasley, Philadelphia, Pa., for Salvatore & Carol Dejewski & Joan Wexler.

John F. McElvenny, Philadelphia, Pa., for Pa. Mfgrs. Assoc. Ins.

MEMORANDUM

CLIFFORD SCOTT GREEN, District Judge.

FACTS AND PROCEDURAL HISTORY

This declaratory judgment action arises out of incidents occurring on the premises of Publicker Industries, Inc. (Publicker). On January 27, 1971, Shafiq Suleiman was discharged from his position with Publicker. On January 29, 1971, Suleiman returned to the premises of Publicker and shot Neil Wexler and Carol Dejewski, both employees of Publicker. As a result of the shooting incident, Wexler died and Dejewski sustained injury.

Subsequently, Dejewski and Joan Wexler, administratrix of the estate of Neil Wexler, brought suit in the Common Pleas Court for Philadelphia County against Publicker. In support of her request for compensatory and punitive damages, Dejewski alleged in part:

Prior to January 29, 1971, the Defendant Publicker through its employees, servants and agents, knew that Shafiq Suleiman was unstable, that he threatened female employees of the Defendant, that he threatened the wife-plaintiff, that he had threatened to take violent action against his being fired on or about January 27, 1971, that he constituted a danger to all employees of the Defendant and the wife-plaintiff in particular.¹

Wexler, seeking damages for the death of her husband, alleged that:

The death of the decedent was caused by the negligence of Publicker, its agents, servants and employees in that they having, or should have had knowledge (sic) that the said Shafiq Suleiman a former employee was a dangerous person, mentally deranged, who had frequently threatened that he would commit bodily harm to Publicker's employees nevertheless permitted him to enter upon the premises of Publicker.²

Wexler also filed a Workmen's Compensation Fatal Claim Petition against Publicker. Publicker filed an Answer denying that the death was related to employment. Such Answer was filed through the Pennsylvania Manufacturers' Association Insurance Company (PMA), Publicker's Workmen's Compensation carrier. At the request of claimant Wexler's attorney, Referee Stevenson ordered an indefinite postponement of the Workmen's Compensation proceeding pending the determination of the Common Pleas action.

Publicker tendered the defense of both the Dejewski and Wexler actions to PMA pursuant to the provision of a Workmen's Compensation and Employer's Liability policy issued to Publicker. PMA declined to afford Publicker either a defense or coverage for the actions, stating that the claims do not "arise out of and in the course of (the claimants') employment", within the meaning of the policy provisions which afford coverage.

Publicker also notified plaintiff herein, Aetna Insurance Company (Aetna), of the suits and tendered the defense and coverage for the claims to Aetna under the provisions of the general liability insurance policy which Aetna had issued to Publicker. After initially rejecting the Publicker tender on the alleged ground that the claims "arose out of and in the course of (the claimants') employment" and hence were excluded from coverage under a provision in Aetna's policy, Aetna caused an appearance to be entered on behalf of Publicker in the Common Pleas Court actions. However, Aetna has afforded Publicker a defense only under the provisions of a reservation of rights letter in which Publicker was advised of Aetna's position that no coverage was afforded under the policy in question.

Aetna has instituted an action for declaratory judgment, praying that this Court adjudge the following:

(a) That coverage for the suits instituted in the Common Pleas Court of Philadelphia County as above described is provided under the policy issued by Pennsylvania Manufacturers Insurance Company;

(b) That Aetna Insurance Company, plaintiff herein, does not extend coverage for the damages claimed in said suits;

(c) That P.M.A. shall be obliged to assume the defense of the actions pending in the Common Pleas Court within the limits of its coverage;

(d) That plaintiff shall be reimbursed by P.M.A. for all expenses and costs incurred to date; and

(e) For such other and further relief as may seem proper.³

Plaintiff Aetna has joined insurer PMA, the insured, Publicker, and claimants Dejewski and Wexler as defendants in this action. Jurisdiction is asserted under 28 U.S.C. § 1332, the diversity jurisdiction statute.

Defendant PMA has moved for judgment on the pleadings or, in the alternative, for summary judgment.⁴ We deny defendant's motion for judgment on the pleadings since plaintiff's pleadings are sufficient on their face. In view of our finding set forth below that there is indeed at least one genuine issue as to a material fact, i. e., the intentions of the parties to the contracts of insurance, we deny defendant PMA's motion for summary judgment.

JURISDICTION

A. Diversity of Citizenship.

Defendant PMA argues that we are without jurisdiction to entertain this matter. As the parties are presently aligned there is diversity jurisdiction; plaintiff Aetna is a Connecticut corporation; all the defendants are Pennsylvania parties; the requisite amount has been alleged. PMA seeks to defeat diversity jurisdiction by realigning Aetna and Publicker on plaintiff Aetna's side of the caption. Such a realignment of parties would result in Pennsylvania parties appearing as both plaintiff and defendant and would effectively divest this Court of jurisdiction over this matter. For reasons set forth below, we decline to realign the parties to this action.

PMA argues that Aetna and Publicker have identical interests in this litigation. It is urged that inasmuch as the claimants in the Common Pleas action have set forth claims far in excess of the coverage extended by Aetna, it is in Publicker's economic interest that PMA provide coverage for the claims in question. Thus, it is argued that Aetna and Publicker must be realigned as plaintiffs to reflect their similar interest. PMA cites no legal authority in support of this argument. Universal Underwriters Insurance Company v. Wagner, 367 F.2d 866 (8th Cir. 1966), cited by Aetna in support of its position that the parties are currently properly aligned as they appear in the caption, refutes PMA's argument. As in Universal, Publicker, has been placed in an undesirable position by Aetna. Aetna claims that Publicker is not entitled to any coverage under the provisions of its policy. Aetna also avers that it has afforded Publicker a defense against the claims in question under a full reservation of its rights under its policy.⁵ In a letter to this Court dated June 16, 1977, considered as a memorandum of law, Publicker responded to PMA's motion for judgment on the pleadings, stating in part that it is its position that "either PMA or Aetna, and perhaps both simultaneously, are legally obligated to extend coverage to us under their respective policies." There is no suggestion in the letter that Publicker endorses Aetna's position that it owes neither a defense nor coverage to Publicker relative to the claims presented against it. These facts belie the contention that there is an amicable relationship between Aetna and Publicker. On the contrary, Aetna's position relative to the claims against Publicker is similar to PMA's position relative to such claims; both insurers vigorously disclaim coverage and accordingly must be considered at loggerheads with Publicker. Universal determines that the fact that an insured may be afforded more beneficial coverage under a policy issued by insurer A as compared to a policy issued by insurer B is not dispositive of the question as to whether there is an actual and substantial controversy between the insured and insurer A. Such question is determined by examination of the positions the respective insurers have taken with respect to coverage. Our examination of the position taken by Aetna regarding the claims presented against Publicker discloses that there is in fact an actual and substantial controversy between Aetna and Publicker such that it would be improper to realign the parties, as urged by PMA.

B. Exhaustion of Administrative Remedies.

Defendant PMA argues that claimants Dejewski and Wexler have not exhausted their administrative remedies and therefore their claims are not properly before the Common Pleas Court. Furthermore, PMA argues that the claimants' failure to exhaust their administrative remedies renders this Court an improper forum for litigating the issues raised by Aetna which may have a bearing upon the question of compensability of the claims under the Pennsylvania Workmen's Compensation Act, 77 P.S. § 1 et seq. PMA places reliance on Greer v. United States Steel Corporation, 237 Pa.Super. 597, 352 A.2d 450 (1975). In Greer, plaintiff brought an action in trespass against his employer for a disease plaintiff alleged he contracted in the course of employment. The Superior Court entered judgment on the pleadings for the employer, finding that plaintiff was not entitled to bring an action for work related injuries or diseases, after he had accepted the Workmen's Compensation Act and alleged in the course of his pleadings that he contracted a disease in the course of his employment which arose out of his employment, and is related thereto; under Greer, Workmen's Compensation authorities not the Common Pleas Courts are empowered to make the initial determination as to compensability.

Dejewski and Wexler argue...