Merchants Mut. Ins. Co. v. American Arbitration Ass'n

• Decision Date: 15 January 1969
• Parties: MERCHANTS MUTUAL INSURANCE COMPANY v. AMERICAN ARBITRATION ASSOCIATION and Michael DiUmberto and Patricia DiUmberto, his wife. Appeal of Michael DiUMBERTO and Patricia DiUmberto his wife.
• Court: Pennsylvania Supreme Court

248 A.2d 842

433 Pa. 250

MERCHANTS MUTUAL INSURANCE COMPANY v. AMERICAN ARBITRATION ASSOCIATION and Michael DiUmberto and Patricia DiUmberto, his wife. Appeal of Michael DiUMBERTO and Patricia DiUmberto his wife.

Supreme Court of Pennsylvania.

January 15, 1969.

Joseph J. Zapitz, Curtin & Heefner, Morrisville, for appellants.

Langdon W. Harris, III, Philadelphia, for appellee Harris, Hammond & Harris, Philadelphia, of counsel.

Before BELL, C.J., and JONES, COHEN, EAGEN, O'BRIEN and ROBERTS, JJ.

OPINION OF THE COURT

COHEN Justice.

This appeal evolved from an automobile collision in which the appellant Mrs. DiUmberto was struck by one who subsequently became an uninsured motorist. Appellants made a demand upon the appellee, Merchants Mutual Insurance Company, with whom appellants carried a collision insurance policy that included in Uninsured Motorists Clause, but were unable to secure satisfaction. They then filed a formal demand for arbitration with the American Arbitration Association pursuant to the provisions of the policy. After the demand for arbitration was served upon it, appellee filed a complaint in equity seeking a preliminary injunction restraining arbitration relying upon the applicability of of two year statute of limitations. Appellee contended that the courts should decide the applicability of the statute of limitations while appellants, relying on Harleysville Mutual Insurance Company v. Medycki, 431 Pa. 67, 244 A.2d 655 (1968), and National Grange Mutual Insurance Company v. Kuhn, 428 Pa. 179, 236 A.2d 758 (1968) would have the arbitrator make that determination.

The court below agreed with the appellee-insurance company's position and issued a preliminary injunction restraining arbitration. The insured appeals from this decree.

In the Kuhn case this Court interpreted the language of the arbitration clause to permit the arbitrator to determine whether the tortfeasor was uninsured, and in Medycki the arbitrator was permitted to decide whether claimant had fulfilled conditions precedent relating to proof of loss. In the instant case, we are required to determine whether the applicability of the statute of limitations is to be adjudicated by the arbitrator or the courts. In the final paragraph of Judge O'Brien's opinion in Medycki it was clearly stated that the arbitrator decides all the issues which bear an uninsured motorists coverage:

'Finally, appellant argues that the arbitrator should not be permitted to decide an issue which has bearing upon all of the...