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July 24, 1962

Peter DITORO, Paul Brawer, Alfred Brawer, S. C. Mazaleski and The Pittston Hospital, Defendants

The opinion of the court was delivered by: SHERIDAN

This is a motion by certain defendants to dismiss plaintiff's complaint for a declaratory judgment. The plaintiff is a Maryland corporation with its principal place of business in Baltimore, Maryland. The defendants are Dr. Peter Ditoro and Dr. S. C. Mazaleski, who are physicians and citizens of Pennsylvania. The Pittston Hospital, a Pennsylvania corporation, and Paul Brawer and Alfred Brawer, individuals, and citizens of New Jersey, are also defendants, but did not move to dismiss.

Motion affidavits were filed by the plaintiff and by defendants, Ditoro.

 On September 2, 1959, defendant, Paul Brawer, a minor, complained of abdominal pain and consulted Ditoro. After treatment by Ditoro, Brawer was admitted to The Pittston Hospital for an appendectomy. On September 6, 1959, the operation was performed by Mazaleski, who had been called into the case by Ditoro. Ditoro assisted Mazaleski during the operation. While in the hospital, Brawer was a surgical patient of Mazaleski, although there were occasional visits by Ditoro. Brawer's condition did not improve, and Mazaleski performed two additional operations to relieve certain complications which developed following the appendectomy.

 Between January, 1960, and February, 1961, Ditoro received four letters regarding Paul Brawer from various attorneys in New Jersey and Pennsylvania. The first three letters were destroyed. Their contents depend on statements made to plaintiff by Ditoro and on Ditoro's affidavit. Ditoro described the first two letters as requests for the name of his insurance company and for information concerning Paul Brawer's treatment. The third letter threatened suit. The fourth letter, attached to Ditoro's affidavit, stated, 'the treatment given Paul Brawer did not conform to the standard of professional care which should have been afforded him.' It invited Ditoro or his representatives to enter into discussions to conclude the matter without the necessity of bringing suit.

 In his affidavit Ditoro said it was his understanding that any injury to Paul Brawer was the result of surgical procedures. Since he was not a surgeon, and did not perform the surgery, and his insurance policy did not cover surgical treatment, he did not notify his insurance carrier of the potential claim.

 On July 18, 1961, Paul Brawer, a minor, by his parent and natural guardian, Alfred Brawer, and Alfred Brawer, in his own right, plaintiffs, filed Civil Action No. 7343 in the United States District Court for the Middle District of Pennsylvania against Ditoro, Mazaleski and The Pittston Hospital, defendants, for personal injuries allegedly due to negligence in the medical and surgical treatment of Paul Brawer. On July 26, 1961, the complaint was served on Ditoro who delivered it to the Allen Insurance Agency, Pittston, on the following day. It is not indicated whether the insurance agency was authorized to receive such notices. In any event, the plaintiff received actual notice by August 2, 1961.

 Plaintiff disclaimed liability under the policy because it contended Ditoro had not given timely notice of Brawers' claims. Plaintiff requested Ditoro to sign an agreement under which plaintiff would undertake Ditoro's defense in Civil Action No. 7343 with a reservation of its right to contest liability under the policy. Ditoro refused and insisted that the company defend the action without reservation. On September 29, 1961, plaintiff notified Ditoro that while it denied liability under the policy, it would join in Ditoro's defense; the joinder was not to be construed as a waiver of any of the conditions of the policy; and the plaintiff would insist on strict compliance with all terms of the policy, especially those concerning notice. Plaintiff also reserved the right to withdraw from the action at anytime. On October 2, 1961, plaintiff's attorney and private counsel for Ditoro filed an answer to Civil Action No. 7343.

 On October 23, 1961, plaintiff filed this declaratory judgment action. In the complaint plaintiff requests the Court to declare that Ditoro did not comply with the notice conditions of the insurance policy; that plaintiff will not be liable to Ditoro for Brawers' claims; and that all proceedings in Civil Action No. 7343 be stayed until final determination of the declaratory judgment proceeding.

 The insurance contract between plaintiff and Ditoro provides in part:

 'I Professional Liability

 Coverage A-Individual Coverage

 To pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of injury arising out of malpractice, error or mistake in rendering or failing to render professional services in the practice of the Insured's profession described in the declarations, committed during the policy period by the Insured or by any person for ...

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