Kohler v. Selective Fire & Cas. Ins. Co.

• Decision Date: 29 September 2022
• Docket Number: Civil Action 3:19-CV-1310
• Parties: ARIAN KOHLER, Plaintiff, v. SELECTIVE FIRE AND CASUALTY INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — Middle District of Pennsylvania

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ARIAN KOHLER, Plaintiff, v. SELECTIVE FIRE AND CASUALTY INSURANCE COMPANY, Defendant.

Civil Action No. 3:19-CV-1310

United States District Court, M.D. Pennsylvania

September 29, 2022

MEMORANDUM OPINION

ROBERT D. MARIANI UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

Selective Fire and Casualty Insurance Company's Motion for Summary Judgment (Doc. 19) is pending before the Court. With the Motion, Defendant seeks summary judgment on the claims contained in Plaintiff Arian Kohler's Complaint and Defendant's counterclaim. This action arises from an accident which occurred in Puerto Rico when Arian Kohler (“Plaintiff'), a Pennsylvania resident, was a volunteer for Healing Emergency Aid Response (“Heart 9/11”). Plaintiff was a pedestrian crossing the street in San Juan when he was struck by a vehicle which was not covered by an auto insurance policy. Selective Fire and Casualty Company (“Selective” “Defendant”) insured Heart 9/11 under a commercial policy (“Policy”) which was in effect at the relevant time. Defendant asserts that Plaintiff is not entitled to coverage under the terms of the Policy for the accident. Plaintiff maintains that he is entitled to coverage because the Policy is invalid and unenforceable under Pennsylvania and New Jersey law. For the reasons that follow, Defendant's Motion will be granted in part and denied in part.

II. STATEMENT OF UNDISPUTED FACTS

Plaintiff was a resident and citizen of Pennsylvania and a volunteer with Heart 9/11 in Puerto Rico when he was involved in an accident. (Doc. 19-2 ¶¶ 1-2; Doc. 23 ¶¶ 1-2.) On June 23, 2018, Plaintiff was crossing a road in San Juan when he was hit by a vehicle that fled the scene. (Id. ¶ 2.) The driver of the vehicle was intoxicated, and the car was not insured. (Id. ¶ 3.) As a result of the accident, Plaintiff suffered a broken leg, severed artery in his leg, and perforated bowels. (Id. ¶ 4.) Plaintiffs right leg was amputated above the knee, requiring a prosthesis. (Id.) Plaintiff obtained benefits for his injuries under his person auto insurance policy issued by USAA and his homeowner's insurance policy issued by Allstate. (Id. ¶5.)

Selective issued Commercial Policy No. S 2202207 to Heart 9/11, a New Jersey corporation, for the policy period March 22, 2018, to March 22, 2019. (Id. ¶¶ 6, 7 (citing Doc. 7-1).)

The Policy provides Uninsured and Underinsured Motorists (“UM/UIM”) Coverage pursuant to the Policy's New Jersey Uninsured and Underinsured Motorists Coverage Endorsement Form SA 2114 10 16. (Id. ¶ 9 (citing Doc. 7-1 at pp. 32-37).) The Policy's UM/UIM Coverage is written on a Covered Auto Symbol 6 basis. (Id. ¶ 10 (citing Doc. 7-1 at 29).) The Description of Covered Auto Designation Symbols in the Business Auto Coverage Form indicates that Symbol 6 applies to “Owned ‘Autos' Subject to a Compulsory Uninsured Motorists Law”:

Only those “autos” you own that because of the law in the state where they are licensed or principally garaged are required to have and cannot reject Uninsured Motorists Coverage. This includes those “autos” you acquire ownership of after the policy begins provided they are subject to the same state uninsured motorists requirement.

(Id. ¶ 11 (citing Doc. 7-1 at 52).)

The UM/UIM Coverage insuring agreement provides:

We will pay all sums the “insured” is legally entitled to recover as compensatory damages from the owner or driver of an “uninsured motor vehicle” or an “underinsured motor vehicle”. The damages must result from “bodily injury” sustained by the “insured”, or “property damage” caused by an “accident". The owner's or driver's liability for these damages must result from the ownership, maintenance or use of an “uninsured motor vehicle” or an “underinsured motor vehicle”.

(Id. ¶ 12 (citing Doc 7-1 at 32 § A.1).)

The UM/UIM Endorsement defines who is an “insured” for purposes of the Endorsement.

If the named insured is designated in the Schedule or Declaration as a partnership, limited liability company, corporation or any other form of organization, then the following are “insureds”:

a. Anyone “occupying” a covered “auto” or a temporary substitute for a covered “auto”. The covered “auto” must be out of service because of its breakdown, repair, servicing, “loss” or destruction.

b. Anyone for damages he or she is entitled to recover because of “bodily injury” sustained by another “insured".

c. The Named Insured for “property damage” only.

(Id. ¶ 13 (citing Doc. 7-1 at 33 § B.2).) The Named Insured of the Policy at issue is “Healing Emergency Aid Response, 9/11 Inc.” (Doc. 7-1 at 16.)

The Policy defines “occupying” as: “in, upon, getting in, on, out or off.” (Doc. 19-3 ¶ 14 (citing Doc. 7-1 at 36 § F.3); Doc. 23 ¶ 14.) The Policy identifies seven autos in the Auto Schedule which constituted the Policy's covered autos. (Id. ¶ 15 (citing Doc. 7-1 at 29).)

The Policy provides Personal Injury Protection (“PIP”) Coverage pursuant to the Policy's New Jersey Personal Injury Protection Form SA 22 30 12 17. (Id. ¶ 15 (citing Doc. 7-1 at 38).) The PIP Coverage insuring agreement provides:

We will pay Personal Injury Protection Benefits for “bodily injury” sustained by an “eligible injured person” caused by an “accident” occurring during the policy period and arising out of the ownership, maintenance or use, including loading or unloading, of a “private passenger auto” as an auto.

(Id. ¶ 17 (citing Doc. 7-1 § A.1).) The Policy's PIP Coverage section defines “eligible injured person” as:

a. The “named insured” and, if the “named insured” is an individual, any “family member,” if the “named insured" or the “family member” sustains “bodily injury.”

1) As a result of any “accident” while occupying, using, entering into or alighting from a “private passenger auto;" or

2) While a “pedestrian,” caused by a “private passenger auto” or by an object propelled by or from a “private passenger auto.”

b. Any other person who sustains “bodily injury":

1) While, with you sic] permission, that person occupying, using, entering into or alighting from the covered “auto” or

2) While a “pedestrian”, caused by the covered “auto” or as a result of being struck by an object propelled by or from the covered “auto”.

(Id. ¶ 18 (citing Doc. 7-1 at 50 § E.3).)^[1]

The PIP Coverage contains the following exclusion:

We will not pay Personal Injury Protection Benefits for “bodily injury”:

c. To any person who is not occupying a covered “auto”, other than the “named insured” or any “family member” or a resident of New Jersey, if the “accident” occurs outside of New Jersey[.]

(Id. ¶ 19 (citing Doc. 7-1 at 42 § B.1.c).)

The Policy's New Jersey Personal Injury Form SA 22 30 12 17 also provides Pedestrian Personal Injury Protection (“Pedestrian PIP”) Coverage. (Id. ¶ 20 (citing Doc. 7-1 at 41 § A.3).) The Policy's Pedestrian PIP insuring agreement provides:

This coverage applies to “pedestrians” and only to “accidents” which occur during the policy period in New Jersey. With respect to an "insured motor vehicle” as described for this coverage, Pedestrian Personal Injury Protection Coverage is the only Personal Injury Protection Coverage for that vehicle.

We will pay Pedestrian Personal Injury Protection Benefits to an “eligible injured person”.

(Id. ¶21 (citing Doc. 7-1 at 41 § A.3).)

For purposes of the Pedestrian PIP section,

a. “Eligible injured person” means:

A person who sustains “bodily injury” while a “pedestrian”, caused by an “insured motor vehicle” or as a result of being struck by an object propelled from the “insured motor vehicle”.

b. “Insured motor vehicle” means a self-propelled motor vehicle designed for use principally on public roads which is not a “private passenger auto" and to which the liability coverage of this Coverage Form applies.

(Doc. 7-1 at 51 § E.5.)

The Policy provides Auto Medical Payments Coverage pursuant to the Policy's Auto Medical Payments Coverage Form CA 99 03 03 06. (Doc. 19-2 ¶ 24 (citing Doc. 7-1 at 80-81); Doc. 23 ¶ 24).) The Auto Medical Payments Coverage is provided on a Covered Auto Symbol 7 basis. (Id. ¶ 25 (citing Doc. 7-1 at p. 29).) The Description of Covered Auto Designation Symbols in the Business Auto Coverage Form indicates that Symbol 7 applies to “Specifically Described ‘Autos'” described as “[o]nly those ‘autos' described in Item Three of the Declarations for which a premium charge is shown (and for Liability Coverage any ‘trailers' you don't own while attached to any power unit described in Item Three).” (Doc. 71 at 52.)

The Auto Medical Payments Coverage insuring agreement provides:

We will pay reasonable expenses incurred for necessary medical and funeral services to or for an “insured” who sustains “bodily injury” caused by “accident”. We will pay only those expenses incurred, for services rendered within three years from the date of the "accident.”

(Doc. 19-2 ¶ 26 (citing Doc. 7-1 at 80 § A); Doc. 23 ¶ 23).)

The Policy's Auto Medical Payments Coverage section defines “insured” as:

1. You while “occupying” or, while a pedestrian, when struck by any “auto”.

2. If you are an individual, any “family member” while “occupying” or, while a pedestrian, when struck by any “auto”.

3. Anyone else “occupying” a covered “auto” or a temporary substitute for a covered “auto”. The covered “auto” must be out of service because of its breakdown, repair, servicing, loss or destruction.

(Id. ¶ 27 (citing Doc. 7-1 at 80 § B).) Under the Policy, “the words ‘you' and ‘your' refer to the Named Insured.” (Id. ¶ 28 (citing Doc. 7-1 at 52).) Under the Auto Medical Payments Coverage section, the term “occupying” means “in, upon, getting in, on, out or off.” (Id. ¶ 29 (citing Doc. 7-1 at 81 § F.2).)

Plaintiff provided notice to Selective of his claim for UM/UIM coverage under the...