Danko v. Erie Ins. Exchange

• Decision Date: 01 October 1993
• Parties: Mary Catherine DANKO, Appellant, v. ERIE INSURANCE EXCHANGE, Appellee.
• Court: Pennsylvania Superior Court

Page 1219

630 A.2d 1219

428 Pa.Super. 223

Mary Catherine DANKO, Appellant, v. ERIE INSURANCE EXCHANGE, Appellee.

Superior Court of Pennsylvania.

Argued Jan. 5, 1993.

Filed July 19, 1993.

Reargument Denied Oct. 1, 1993.

William M. Radcliffe, Uniontown, for appellant.

Stephen P. McCloskey, Washington, for appellee.

Before ROWLEY, President Judge, and JOHNSON and MONTGOMERY, JJ.

MONTGOMERY, Judge:

This appeal presents an issue of first impression concerning the Pennsylvania Motor Vehicle Financial Responsibility Law ("MVFRL"). Act of February 12, 1984, P.L. 26, No. 11, § 3, 75 Pa.C.S.A. § 1701, et seq., effective October 1, 1984. This action was instituted by plaintiff Mary Catherine Danko to recover income loss benefits against defendant Erie Insurance Exchange, her motor vehicle insurer. The plaintiff's action was based upon an interpretation of the MVFRL which differed from that relied upon by the insurer. The appeal arises from an order by the Court of Common Pleas of Fayette County which granted summary judgment for the defendant as to one of four counts in the plaintiff's complaint. We conclude that the trial court erred in granting that summary judgment.

It is initially appropriate to discuss the issue of whether this matter is ripe for appellate review. The plaintiff instituted a four count complaint against the defendant, alleging it had improperly failed to pay her income loss benefits. Count I alleged breach of contract; Count II alleged a breach of an implied covenant of good faith and fair dealing; Count III alleged a violation of the Unfair Trade Practices and Consumer Protection Law; and Count IV presented a class action claim for all similarly situated insureds who had been denied benefits sought by the plaintiff in this action. The trial court granted summary judgment in favor of the defendant on the first count, holding that income loss benefits were not due under the terms of the insurance contract. The trial court certified the order for interlocutory appeal by permission, pursuant to Pa.R.App.P. 312, by including language in its order in accordance with 42 Pa.C.S.A. § 702(b). Even in the circumstance of such a certification, Pa.R.App.P. 1311(b) requires that an appellant file a petition for permission to appeal. In the absence of such a petition from the appellant, the appeal would ordinarily be quashed and the case remanded, despite both the trial court's certification of the issue, and the lack of any objection from the opposing party. Vendale Coal Company, Inc. v. Voto Manufacturing Sales Company, 353 Pa.Super. 635, 510 A.2d 1246 (1986); Gellar v. Chambers, 292 Pa.Super. 324, 437 A.2d 406 (1981). However, a review of the issues presented in this case makes it clear that the order granting summary judgment for the defendant on the first count of the plaintiff's complaint effectively put the plaintiff out of court and ended the litigation. The determination by the trial court that the defendant had not improperly failed to pay the plaintiff the income loss benefits, as claimed in Count I, precluded any further litigation of the plaintiff's breach of covenant of good faith and fair dealing (Count II), Unfair Trade Practices and Consumer Protection Law (Count III), and class action (Count IV) claims. Accordingly, the order of the trial court will be considered as final and immediately appealable. See, Pugar v. Greco, 483 Pa. 68, 394 A.2d 542 (1978); Bell v. Beneficial Consumer Discount Company, 465 Pa. 225, 348 A.2d 734 (1975). We also note that because this action was commenced prior to July 6, 1992, the amendment to Pa.R.App.P. 341, regarding final orders, does not apply.

In reviewing the trial court order granting summary judgment, we are mindful that the trial court's order should not be reversed unless the court has committed an error of law or clearly abused its discretion. Denlinger, Inc. v. Dendler, 415 Pa.Super. 164, 608 A.2d 1061 (1992). Of course, the instant case presents a question of whether the trial court erred in interpreting a provision of the MVFRL. Thus, a claimed error of law is presented by this appeal.

The facts are not in dispute. The plaintiff was injured in a motor vehicle accident on January 18, 1990, while in the course of her employment with Burke Bus Lines. As a result of her injuries, the plaintiff has been disabled and unable to perform her duties as a bus driver. At the time of the accident, the plaintiff's average weekly wage was $152.60. Since the date of the accident, her employer's workmen's compensation insurance carrier has been paying the plaintiff workmen's compensation benefits in the amount of $139.67 per week. ¹ The difference between the plaintiff's average pre-injury weekly gross income and the workmen's compensation benefit she received was $12.93. The MVFRL, in 75 Pa.C.S.A. § 1712(2)(i) provides that the income loss benefit to be provided by an insurer shall be "Eighty percent of actual loss of gross income." Consistent with that statutory provision, the policy issued to the plaintiff by the defendant indicated that the insurer would pay eighty percent of the gross income "... actually lost by a person we protect." The policy provided for income loss benefits in maximums of no more than $15,000 per accident, to be paid at a rate not to exceed $1,000 per month.

The plaintiff provided a proof of loss to the defendant, and made a demand for income loss benefits on March 26, 1990. In a response, the defendant denied that any benefits were due. It is the position of the plaintiff that she is entitled to income loss benefits of $10.34 per week, representing eighty percent of the $12.93 difference between her average weekly gross income of $152.60 and the workmen's compensation benefit which amounts to $139.67 per week. Thus, the plaintiff maintains that "eighty percent of actual loss of gross income" in the applicable policy and the MVFRL means that income loss benefits should be calculated, in this situation, by subtracting the weekly workmen's compensation benefit from the gross weekly income she enjoyed at the time of the accident, and computing eighty percent of the difference. She argues that the difference represents the "actual loss of gross income". The defendant, on the other hand, maintains that no income loss benefits are due, because the plaintiff is already receiving workmen's compensation benefits that are greater than eighty percent of the gross weekly wage she enjoyed immediately prior to her period of disability from the motor vehicle accident. Thus, the insurer contends that it is not required, either under the applicable policy or the MVFRL, to pay the plaintiff any income loss benefits. The defendant argues that the proper way to calculate income loss benefits would be to multiply the plaintiff's pre-injury average weekly gross income by eighty percent, and then subtract from that result any weekly workmen's compensation benefits which may be paid to the insured. Because the plaintiff's workmen's compensation benefits exceeded eighty percent of her weekly gross income at the time of the accident, under the defendant's proposed interpretation no income loss benefits would be due.

We are called upon in this case to interpret a statutory provision which has some ambiguity. In determining the legislative intent with regard to the legislation in issue, we are guided by a number of concepts and rules. The Act of December 6, 1972, P.L. 1339, No. 290, § 3, 1 Pa.C.S.A. § 1921, provides the following rules of statutory construction:

(a) The object of all interpretation and construction of statutes is to ascertain and effectuate the intention of the General Assembly. Every statute shall be construed, if possible, to give effect to all its provisions.

(b) When the words of a statute are clear and free from all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit.

(c) When the words of the statute are not explicit, the intention of the General Assembly may be ascertained by considering, among other matters:

(1) The occasion and necessity for the statute.

(2) The circumstances under which it was enacted.

(3) The mischief to be remedied.

(4) The object to be attained.

(5) The former law, if any, including other statutes upon the same or similar subjects.

(6) The consequences of a particular interpretation.

(7) The contemporaneous legislative history.

(8) Legislative and administrative interpretations of such statute.

In resolving the issue presented in this appeal, we recognize that the MVFRL was enacted as a means of insurance reform to reduce the escalating costs of purchasing motor vehicle insurance in our Commonwealth. Lambert v. McClure, 407 Pa.Super. 257, 595 A.2d 629 (1991); Huber v. Erie Insurance Exchange, 402 Pa.Super. 443, 587 A.2d 333 (1991). However, the underlying objective of the MVFRL is to provide broad coverage to assure the financial integrity of the policyholder. Callahan v. Federal Kemper Insurance Company, 390 Pa.Super. 201, 568 A.2d 264 (1989); Omodio v. Aetna Life and Casualty, 384 Pa.Super. 544, 559 A.2d 570 (1989). The Law is to be construed liberally to afford the greatest possible coverage to injured claimants. Sturkie v. Erie Insurance Group, 407 Pa.Super. 117, 595 A.2d 152 (1991). In close or doubtful insurance cases, it is well-established that a court should resolve the meaning of insurance policy provisions or the legislative intent in favor of coverage for the insured. Motley v. State Farm Mutual Insurance Company, 502 Pa. 335, 466 A.2d 609 (1983); Crawford v. Allstate Insurance Company, 305 Pa.Super. 167, 451 A.2d 474 (1982); See also 1 Pa.C.S.A. § 1928(c).

When considering arguably ambiguous statutory provisions, a court may consider prior law, if any, upon the same or similar subjects. 1 Pa.C.S.A. § 1921(c)(5). In that regard, we are assisted in the resolution of this case...