The opinion of the court was delivered by: SHERIDAN
This matter is before the court on the objections of Nationwide Mutual Insurance Company, garnishee, to interrogatories propounded by plaintiff, and to plaintiff's motion to produce certain records related to this action.
Pursuant to the insurance contract, defendant was represented by counsel of Nationwide's choice who was entrusted with all phases of the case from investigation through the post trial motions. Defendant did not have private counsel. Plaintiff offered to settle for the policy limits of $25,000, but Nationwide refused. After denial of the post trial motions, Nationwide paid plaintiff the $25,000.
Plaintiff then filed a praecipe for writ of execution against defendant. The writ directed the Marshal to attach the property of the defendant in the possession of Nationwide as garnishee. At the same time, it directed interrogatories to Nationwide pursuant to Rule 3144 of the Pennsylvania Rules of Civil Procedure, 12 P.S.Appendix.
Nationwide answered interrogatories 1, 2 and 3 concerning the existence of and terms of the insurance policy, and interrogatories 21, 22 and 23 concerning the judgment, the payment of the policy limits and that it is indebted to defendant for $731.09, representing interest from the time of the judgment to the payment of the policy limits. It objected to all intervening interrogatories, 4 to 20 inclusive, as not within the scope of the attachment execution proceedings and as not relevant to the attachment of any debt, property, title or interest of defendant under the control of Nationwide. Plaintiff also filed a motion for production of records under Rule 34 of the Federal Rules of Civil Procedure which sought to obtain for inspection many of the documents whose existence was sought to be ascertained by the interrogatories.
Plaintiff contends that Nationwide breached its duty of fair representation by rejecting plaintiff's offer of settlement thereby subjecting defendant to liability for the deficiency between the judgment and the policy limits;
that a claim for the breach lies against an insurer; that the claim is assignable and that the attachment worked an assignment; and that the garnishment and interrogatories under Pennsylvania procedure constitute a pleading which states the cause of action of breach of duty of fair representation. Nationwide contends that there is no debt in the present posture of this lawsuit which is attachable through garnishment; and that in effect plaintiff is attempting to set herself up as a third party beneficiary under the insurance contract, which was not intended by either Nationwide or defendant.
In Gray v. Nationwide Mut. Ins. Co., 1966, 422 Pa. 500, 223 A.2d 8, the Pennsylvania Supreme Court clearly held that an insured has a cause of action in assumpsit against an insurer which subjects the former to liability by virtue of a breach of the fiduciary duty of good faith representation. In Gray, there was an actual assignment to the injured party of the insured's rights against the insurer, which the court held to be a proper assignment. The question presented here is whether under the doctrine of equitable assignment and by means of garnishment proceedings, plaintiff is permitted to pursue the same course without an actual assignment.
We must distinguish between the accrual of a cause of action and its enforcement. Nationwide's action or inaction, whether known or unknown to defendant, may have given rise to a cause of action for breach of duty of good faith. Thus, to that extent the facts giving rise to a possible cause of action were fixed at some previous time, and a claim exists, potentially at least. Defendant, however, has not taken any steps to assert that claim. He has not made a demand on Nationwide. He has not acknowledged that the right exists by means of an assignment or by other means. He may not even feel aggrieved.
In Paul v. Kirkendall, 1957, 6 Utah 2d 256, 311 P.2d 376, the Supreme Court of Utah had a similar situation before it. A plaintiff-judgment creditor sought to enforce, through garnishment, his debtor's supposed right of action for breach of duty of good faith representation against the liability insurer which had refused to settle the claim. The court rejected the proposition that the chose in action in favor of the defendant-judgment debtor and against the garnishee had matured to the point where it represented a debt which could be reached in garnishment:
"In plaintiffs' brief it is contended that the chose in action in favor of defendant and against the garnishee is a liquidated claim in the amount of $10,605.39. It is impossible either to agree with this contention or to follow the processes by which such conclusion is reached, and the contention is without facts to support the same."
The court also pointed out that the defendant-judgment debtor had asserted no claim against the insurer, and had not authorized the plaintiff-judgment creditor, through assignment, to assert the claim.
"However, we are not here concerned with the substantive rights between Kirkendall and the Maryland Casualty Company. The insured is not here complaining of any act or omission on the part of garnishee by which he claims to have been damaged.
"There is a complete lack of any suggestion that the plaintiffs have been authorized to protect defendant against the garnishee. There is no suggestion that defendant's rights against the ...