Donnelly v. Bauer
| Decision Date | 29 September 1998 |
| Citation | 553 Pa. 596,720 A.2d 447 |
| Parties | Dennis DONNELLY, Appellant, v. Debra BAUER, Appellee. Francis and Kathy HAVEL, Appellants, v. Lorriane McCARRY, Appellee. Roberto HENNINGHAM, Appellant, v. Nong PHEACH, Appellee. Joan P. WILLIAMS and Barbara Merriweather and Denise Williams and Helene Savage, v. Mary Sandra SHEMONSKY. Appeal of Barbara MERRIWEATHER. Mervis M. URQUHART and DeWayne Dixon, a minor, by his Parent and Natural Guardian, Mervis M. URQUHART and Mervis M. Urquhart in her own right, Appellants, v. Marla MEDNICK, Appellee. Julia TRULEAR, v. Roger TRULEAR, v. Bessie LAYTON. Appeal of Julia TRULEAR. Francisco HIGUITA and Rosalba Higuita, Appellants, v. Hai Son DINH, Appellee. |
| Court | Pennsylvania Supreme Court |
Mitchell S. Clair, Nicholas J. Oritz, Philadelphia, James R. Ronca, Harrisburg, Richard M. Golomb, Philadelphia, for Dennis Donnelly.
Michael E. Kosik, Harrisburg, Amicus-Pa. Trial Lawyers.
Joseph M. Hankins, Wayne A. Schaible, Lise Luborsky, Philadelphia, John J. McGrath, Jr., Joseph J. Urbain, Peter J. Hoffman, Philadelphia, for Deborah Bauer.
Joseph E. Mayk, Philadelphia, Amicus-Assigned Risk Plan.
Scott J. Tredwell, Amicus-Pa. Ins. Federation of Pa. and Nat. Assoc. of Independent Insurers and Pa. Defense Institute.
Terrence A. Keating, Harrisburg, Amicus-Pa. Ins. Dept.
Mitchell S. Clair, Richard M. Golomb, Edwin L. London, Philadelphia, James R. Ronca, Harrisburg, for Francis and Kathy Havel.
Joseph M. Hankins, Wayne A. Schaible, Lise Luborsky, Robert J. Casey, Jr., Philadelphia, for Lorraine McCarry.
David Levenberg, Mitchell S. Clair, Philadelphia, for Robert Henningham.
Joseph D. Mancano, Philadelphia, for Nong Pheach.
David Levenberg, Mitchell S. Clair, Richard M. Golomb, Philadelphia, James R. Ronca, Harrisburg, for Barbara Merriweather.
Daryl W. Winston, Philadelphia, for Mary Sandra Shemonsky.
Michael B. Krupnick, Mitchell S. Clair, Philadelphia, James R. Ronca, Harrisburg, for Mervis M. Urquhart and Dewayne Dixon.
Amy Loperfido, Philadelphia, for Marla Mednick.
David Levenberg, Mitchell S. Clair, Philadelphia, James R. Ronca, Harrisburg, for Julia Trulear.
Stephen J. Margolin, Philadelphia, for Roger Trulear.
James Stover, Philadelphia, for Bessie Layton.
Barbara M. Daly, Philadelphia, for Francisco and Rosalba Higuita.
Robert J. Casey, Philadelphia, for Hai Son Dinh.
Before FLAHERTY, C.J., and ZAPPALA, CAPPY, CASTILLE, NIGRO and NEWMAN, JJ.
The sole issue in these consolidated appeals is whether the Motor Vehicle Financial Responsibility Law ("MVFRL")1 requires that an individual, who applies for an original insurance policy after July 1, 1990, be provided with a specific form which contains premium information for both the full and limited tort options. While we find that the plain language of the MVFRL requires an individual purchasing an original insurance policy after July 1, 1990 to receive such premium information, we nevertheless affirm the order of the Superior Court because the MVFRL fails to provide a remedy to an individual who does not receive this information. An understanding of the specific facts particular to each appellant is not necessary for purposes of this appeal. Instead, one must understand the general facts concerning appellants' original purchase of automobile insurance.
In the appeal sub judice, there are two general factual scenarios regarding the original purchase of automobile insurance. Appellants Havel, Urquhart and Trulear all purchased original automobile insurance policies with the insurance company of their choice after July 1, 1990.2 When each appellant applied for their original insurance policies, they received a notice required by 75 Pa.C.S. § 1791.1 which explained the difference between the limited tort option and the full tort option. The notice each appellant received did not contain any premium or cost comparison between the limited tort option and the full tort option. After receiving these notices, each of these appellants elected the limited tort option offered by each insurance company. The purchase of the "limited tort" option allowed appellants to reduce their insurance premium. In return for this reduced premium, appellants were generally precluded from recovering for a non-economic loss3 unless they sustained a "serious injury"4 from an accident. 75 Pa.C.S. § 1705(d).
Appellants Donnelly, Henningham and Merriweather did not purchase their insurance policies directly through a private insurer. Instead, each of these three appellants received their original insurance after July 1, 1990 through Pennsylvania's Assigned Risk Plan.5 When deciding whether to select the limited tort option or the full tort option, each of these three appellants received and signed Form PA-1000. This Form PA-1000 was issued by the assigned risk plan and contained virtually the same information contained in the notice required by 75 Pa.C.S. § 1791.1. Thus, the appellants participating in the assigned risk plan did not receive a premium or cost comparison between the limited tort option and the full tort option.
Subsequent to the purchase of insurance, each appellant was involved in an automobile accident. As a result of their accidents, appellants instituted a lawsuit against the respective appellee in each case on this appeal. Appellants filed motions in limine prior to trial seeking to preclude appellees from raising the limited tort waiver defense. In essence, appellants sought to invalidate their limited tort selections on the grounds that their insurance companies had failed to provide the proper notice before the purchase of insurance that is required by 42 Pa.C.S. § 1705. The notice required by 42 Pa.C.S. § 1705(a)(1) must contain the annual premium which an insured would incur if he purchased the limited tort option or the full tort option.
Appellants' motions in limine were consolidated in the trial court pursuant to Philadelphia Civil Rule 206.2 and the Administrative Order of the Honorable Alex Bonavitacola. The trial court, after reviewing the above-referenced statutory provisions and the purpose behind the enactment of the MVFRL, concluded that appellants' insurance companies were required by law to issue a notice pursuant to 42 Pa.C.S. § 1705 containing the premium cost associated with choosing the limited tort option and the full tort option. The trial court based this conclusion on the trial court's public policy perception that consumer protection required notice of the cost comparison involved in choosing a particular option. Since the trial court determined that the insureds had not made valid and knowing elections of tort coverage, the trial court held that the full tort election applied and granted the motions in limine. See 75 Pa.C.S. § 1705(a)(3).6
After entering this order, the trial court certified the present cases for interlocutory appeal to the Superior Court. On March 6, the Superior Court granted permission to appeal. On October 29, 1996, an en banc Superior Court in a seven-to-three decision reversed the trial court. The Superior Court majority decision enforced appellants' limited tort selections because it found that the legislative design and administrative scheme formulated by the Insurance Department only required the cost comparison to be offered to insureds renewing their policy for the first time after July 1, 1990. Since appellants did not purchase their original insurance policy until after July 1, 1990, no premium comparison was required for appellants.7 This Court granted allocatur in order to decide whether the MVFRL required appellants, who applied for an original insurance policy to be issued after July 1, 1990, to have been provided with a specific notice that contains premium information for both the full and limited tort options.
This Court begins its analysis by looking to the appellants who obtained their insurance through the voluntary market. In enacting the 1990 amendments to the MVFRL,8 the General Assembly sought to slow the rising cost of automobile insurance in the Commonwealth. As part of this plan, the General Assembly gave each individual the ability to choose full tort or limited tort coverage. As previously described, the limited tort option gave an individual lower premiums in return for relinquishing the right to seek recovery for non-monetary damages while an individual choosing the full tort option did not receive as great of a premium reduction since he still had the ability to recover non-monetary damages. As part of the 1990 amendments to the MVFRL, an individual selecting the limited tort option was to receive a twenty-two percent (22%) reduction in his total premium for the same coverage prior to the amendments while a person choosing the full tort option was to receive a ten percent (10%) premium reduction. 75 Pa.C.S. § 1799.7(b)(1) & (2).
When enacting this plan to provide rate reductions, the General Assembly provided mechanisms by which consumers were to be alerted of their available options. Section 1705(a)(1) of Title 75 provides:
NOTICE TO NAMED INSUREDS
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