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RESOLUTE INSURANCE CO. v. PENNINGTON (11/15/66)

decided: November 15, 1966.

RESOLUTE INSURANCE CO., INC., APPELLANT,
v.
PENNINGTON



Appeal from order of Court of Common Pleas of Allegheny County, July T., 1966, Execution No. 86, in case of Resolute Insurance Co., Inc., Guy C. Read, Jr., trustee v. Mary H. Pennington and Dolores Hewitt.

COUNSEL

Allen N. Brunwasser, for appellant.

Henry E. Rea, Jr., with him Brandt, Riester, Brandt & Malone, for appellees.

Bell, C.j., Musmanno, Jones, Cohen, Eagen, O'Brien and Roberts, JJ. Opinion by Mr. Justice Eagen. Dissenting Opinion by Mr. Chief Justice Bell.

Author: Eagen

[ 423 Pa. Page 474]

This appeal is from an order of the Court of Common Pleas of Allegheny County striking and setting aside a writ of execution and levy filed by the appellant, Resolute Insurance Company (Resolute), against Manhattan Life Insurance Company of New York (Manhattan), as garnishee, and the holder of certain insurance proceeds payable to Dolores Hewitt, one of the defendants in the proceedings below.

In June 1964, Western Allegheny Mining Company, Inc. (Western) and Mac Coal Company (Mac), enterprises controlled by George N. Pennington, required performance bonds to comply with the provisions of the Bituminous Coal Open Pit Conservation Mining Act, 52 P.S. ยง 1396.4(g). Resolute posted the bonds and in return secured from Western, Mac, Pennington and his wife a written contract of indemnity designed to protect Resolute against loss. Dolores Hewitt, daughter of George N. Pennington, executed the contract as surety. The agreement contained, inter alia, the following provision: "That the company has become bound under the said bonds for the special benefit of the principal and the indemnitor and the special benefit and protection of the property of the principal and the indemnitor, their income and earnings. That the indemnitor is substantially and beneficially interested in obtaining the said suretyship. That the company looks

[ 423 Pa. Page 475]

    to and relies upon and shall at all times have the right to look to and rely upon, recover from, and follow the property which the principal and the indemnitor now have and which they hereafter may have and the income and earnings thereof for any sum or sums due or to become due the company under this agreement." Also, a provision that in the event of default on the contract, entry of judgment and execution, the indemnitors would claim "no benefit of exemption . . . under and by virtue of any exemption law now in force or which may be hereafter passed."

Resolute was later called upon to pay under the provisions of the bonds and sustained a loss, which they now seek to collect from the indemnitors. It confessed judgment against Mary H. Pennington and Dolores Hewitt on April 7, 1966, for the sum of $127,409.65 including $16,618 as attorney's commission for collection. The confession of judgment was pursuant to a warrant of attorney contained in the contract.

The record discloses that George N. Pennington died on February 9, 1966. At the time of his death, there was in force a policy of insurance on his life with Manhattan. Dolores Hewitt was the beneficiary. The insured, during his lifetime, had opted for an annuity type mode of settlement for the beneficiary, so that Manhattan holds a bulk sum in behalf of Dolores Hewitt payable to her in equal monthly installments.*fn1 It is this sum, $19,146.69, which Resolute levied against.

Dolores Hewitt filed a motion to strike and set aside the writ of execution and levy, pursuant to Pa. R. C. P. 3121(d). A ...


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