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SMALIGO v. FIREMAN'S FUND INSURANCE COMPANY (11/12/68)

decided: November 12, 1968.

SMALIGO
v.
FIREMAN'S FUND INSURANCE COMPANY, APPELLANT



Appeal from order of Court of Common Pleas of Allegheny County, April T., 1968, No. 719, in case of Michael Smaligo et al. v. Fireman's Fund Insurance Company.

COUNSEL

Robert E. Wayman, with him Bernard J. McAuley, and Wayman, Irvin, Trushel & McAuley, for appellant.

Robert E. Walsh, with him Suto, Power, Balzarini & Walsh, for appellees.

Bell, C. J., Musmanno, Jones, Cohen, Eagen, O'Brien and Roberts, JJ. Opinion by Mr. Justice Jones. Mr. Justice Musmanno, Mr. Justice Cohen, and Mr. Justice Roberts did not participate in this decision.

Author: Jones

[ 432 Pa. Page 134]

Michael and Mary Smaligo, as personal representatives of their daughter's estate, instituted arbitration proceedings to recover for the daughter's death caused by a hit-and-run driver on March 27, 1967, at a time said daughter, aged 37, was on a home week-end visit from Mayview State Hospital where she had been a patient since 1962. Arbitration proceeded under the "Uninsured Motorist Clause" of Smaligos' policy of insurance with Fireman's Fund Insurance Company, which resulted in an award to Smaligos of only $243.00 (a figure which represented one-third of the cost of the family memorial monument).

Smaligos moved to vacate the award on the ground of certain irregularities in the arbitration proceedings, to wit: (1) that the arbitrator proceeded to make an

[ 432 Pa. Page 135]

    award even though informed by Smaligos' counsel of their acceptance of a settlement offer made prior to the arbitration proceedings, which offer Smaligos claimed was still outstanding; and (2) that the arbitrator denied a request of Smaligos' counsel for a recess to obtain the testimony of Dr. Parsons, decedent's attending physician, as to decedent's future work expectancy, the arbitrator holding such testimony not to be necessary. Smaligos argued that these irregularities resulted in an unjust, inequitable and unconscionable award for the death of a 37-year old woman who had been gainfully employed prior to her commitment to Mayview State Hospital in 1962. After a hearing on Smaligos' motion the court below issued an order vacating the award and remanding the case for hearing de novo before another arbitrator to be selected from the American Arbitration Association Panel.

The insurance company has appealed from said order, contending that, since the proceedings were admittedly under the common law, the court was bound by the arbitrator's action. In making this argument, the insurance company relies on our holding in Harwitz v. Selas Corporation of America, 406 Pa. 539, 178 A.2d 617 (1962), as follows: "If the appeal is from a common law award, appellant, to succeed, must show by clear, precise and indubitable evidence that he was denied a hearing, or that there was fraud, misconduct, corruption or some other irregularity of this nature on the part of the arbitrator which caused him to render an unjust, inequitable and unconscionable award, the arbitrator being the final judge of both law and fact, his award not being subject to disturbance for a mistake of either."

A review of the record reveals the following facts: Elizabeth Smaligo, the decedent -- a high school graduate who had also attended night classes at Duquesne

[ 432 Pa. Page 136]

University -- had been gainfully employed as a secretary by Westinghouse Electric Corporation from 1949 until October, 1962, when she was admitted to Western Psychiatric Hospital and there diagnosed as schizophrenic. Later she was committed to Mayview State Hospital and, at the time of her death, was still so committed though permitted to visit her home on weekends and holidays. During such a home week-end stay she was struck by a hit-and-run driver on March 27, 1967. Smaligos then made claim against their insurance company under the terms of the Uninsured Motorist Provisions of an automobile liability policy that had been issued to them by that company wherein the company had agreed to pay "all sums which the insured or his legal representative shall be legally entitled to recover as damages." The company refused to pay the $9,750.00 asked by Smaligos in settlement and on July 27, 1967 the company notified Smaligos' counsel by letter as follows: "We concede that there is a settlement value to the case but that it is not worth $9750. as demanded by you. In an effort to avoid further expenses and time to both, I will now make an offer to conclude this claim on ...


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