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ST. PAUL MERCURY INSURANCE COMPANY v. AMERICAN ARBITRATION ASSOCIATION (05/24/67)

decided: May 24, 1967.

ST. PAUL MERCURY INSURANCE COMPANY, APPELLANT,
v.
AMERICAN ARBITRATION ASSOCIATION



Appeal from decree of Court of Common Pleas No. 3 of Philadelphia County, Dec. T., 1965, No. 3724, in case of St. Paul Mercury Insurance Company v. American Arbitration Association, Edgar R. Einhorn, Sidney B. Gottlieb et al.

COUNSEL

Miles Warner, for appellant.

Walter Lazaroff, with him Bernstein, Bernstein, Harrison & Kessler, for appellee.

Bell, C. J., Musmanno, Jones, Eagen, O'Brien and Roberts, JJ. Opinion by Mr. Justice O'Brien. Mr. Justice Cohen took no part in the consideration or decision of this case.

Author: O'brien

[ 425 Pa. Page 549]

Sidney B. Gottlieb was involved in an automobile accident while driving an automobile owned by his wife. The other party to the collision was one Leland P. Plenty. The Gottlieb automobile was covered by a liability insurance policy issued by appellant, St. Paul Mercury Insurance Company, which, by definition of the persons insured, included Sidney Gottlieb. Included

[ 425 Pa. Page 550]

    among the various coverages of the policy was uninsured motorist coverage. St. Paul paid Mrs. Gottlieb for damages to her automobile under the collision coverage of the policy, and was thereby subrogated to her rights against Plenty. Sidney Gottlieb made a claim for personal injuries on Plenty, who was ostensibly covered by a liability insurance policy issued by Safeguard Mutual Insurance Company. During the pendency of Sidney Gottlieb's claim against Plenty, Safeguard's representatives equivocated as to whether Plenty was, in fact, covered by an insurance policy written by Safeguard.

Eventually, Gottlieb filed an action of trespass against Plenty and an appearance for Plenty was entered by counsel for Safeguard. This suit is still pending.

On September 7, 1965, after interrogatories had been filed and other steps taken by Safeguard, indicating that it was rendering a defense on behalf of Plenty, Safeguard wrote to counsel for Gottlieb as follows: ". . . there is no insurance coverage in force in favor of Leland Plenty under which Sidney B. Gottlieb, the plaintiff, will be paid any monies if he is successful in the above captioned matter. We specifically disclaim all liability to him as we are defending this matter under a non-waiver arrangement with the defendant." (Emphasis supplied)

Following receipt of this letter, Gottlieb made a claim on St. Paul Mercury for $10,000, which was the limit of his coverage under the uninsured motorist provision of his policy. Subsequently, Gottlieb addressed a demand to the American Arbitration Association for arbitration of his claim against St. Paul Mercury. St. Paul Mercury filed an action in equity against Gottlieb, the American Arbitration Association, and its named arbitrator, Edgar R. Einhorn, and Safeguard Mutual Insurance Company, seeking to enjoin

[ 425 Pa. Page 551]

    the arbitration of Gottlieb's claim. St. Paul Mercury further sought a declaration that Safeguard's policy issued to Plenty afforded him coverage as of the date of the accident, and ...


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