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O'SHANICK v. ALLSTATE INS. CO.

May 11, 1977

LESTER M. O'SHANICK, Plaintiff
v.
ALLSTATE INSURANCE COMPANY, a corporation, Defendant



The opinion of the court was delivered by: SNYDER

 This action was brought for the payment of insurance benefits and was removed to the United States District Court by the Defendant, Allstate Insurance Company (Allstate) because of diversity jurisdiction. Allstate has now moved for partial judgment on the pleadings as to Plaintiff's claim for punitive damages and this Court will grant the Defendant's Motion.

 I.

 O'Shanick was involved in an automobile accident on November 20, 1975. He was uninsured and made application for Pennsylvania No-fault Insurance Benefits under the provisions of the Act (40 P.S. § 1009.101 et seq.) to the Pennsylvania Mutual Casualty Insurance Company, the insurer of Warren C. Saurers, Inc., who was also involved in the accident. Pennsylvania Mutual denied O'Shanick's claim which was therefore assigned under the Pennsylvania Assigned Claims Plan (40 P.S. §§ 1009.204-5) to Allstate. O'Shanick brought this suit for non-payment of benefits within 30 days after Allstate had received sufficient information, seeking not only the amount of his claim, but punitive damages as well. His medical bills amounted to $2239.50. *fn1"

 The essence of O'Shanick's claim is that Allstate exhibited bad faith in not immediately paying his benefits and that this is sufficient for the imposition of punitive damages. Allstate replies:

 (1) The mere failure to pay within 30 days is not evidence of bad faith and,

 (2) In any event, the No-fault statute precludes the allowance of punitive damages.

 We shall direct our consideration to the Defendant's second contention.

 II.

 The Court's attention has not been drawn to any Pennsylvania cases construing the allowance of punitive damages in the no-fault situation. This Pennsylvania statute is a comprehensive one which replaces the basic accident and insurance law as to liability for vehicle accidents.

 The statute provides: (40 P.S. § 1009.102)

 
"(5) exhaustive studies by the United States Department of Transportation, the Congress of the United States and the General Assembly have determined that the present basic system of motor vehicle accident and insurance law, which makes compensation and restoration contingent upon:
 
(A) every victim first showing that someone else ...

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