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June 22, 1979


The opinion of the court was delivered by: VANARTSDALEN


Cross-motions for summary judgment have been filed. The action seeks a declaratory judgment as to the rights of the parties under an "uninsured motorist" clause of an insurance policy issued by the plaintiff. Gabriel Pont was the occupant of a car that had been insured by plaintiff. He was injured when the car had a collision with another car operated by Ruth A. Joell. Ms. Joell's car carried liability insurance through GEICO for the Pennsylvania statutorily mandated minimum sum of $ 15,000.00. Defendant, Gabriel Pont settled with Ruth A. Joell and GEICO by collecting the full $ 15,000 from GEICO. Defendant then claimed against the plaintiff, Prudential Property and Casualty Insurance Company (Prudential), for the maximum coverage of $ 15,000 that Prudential's policy provided to the car in which he was an occupant under the "uninsured motorist" clause. Upon Prudential's denial of coverage, defendant demanded arbitration, claiming such right under the policy. This action ensued to determine the rights between Prudential and the occupant of the car, Gabriel Pont. The collision occurred in Pennsylvania, and Pennsylvania law controls.

 Preliminarily, a jurisdictional issue was raised by defendant, a Pennsylvania citizen, claiming lack of diversity by asserting that Prudential's principal place of business is in Pennsylvania. Plaintiff has filed an uncontested affidavit together with a copy of its certificate of incorporation, showing that its State of Incorporation and principal place of business is New Jersey. There is diversity jurisdiction.

 The issues raised were addressed in the memorandum and order of February 14, 1979 denying defendant's motion to dismiss. Plaintiff contends that Ruth A. Joell, having the required $ 15,000 minimum liability coverage was not an uninsured motorist under Prudential's policy. Defendant, in substance, contends that (a) the uninsured motorists clause should be construed to mean "underinsured motorist" and (b) in any event, he is entitled to have the issue finally decided, whether rightly or wrongly, by arbitration.

 Neither party has suggested that there is any factual issue in dispute. I conclude that plaintiff is entitled to summary judgment.

 The car that was operated by Ruth A. Joell carried liability insurance in the limit of $ 15,000 for bodily injury to any one person. Under the Pennsylvania No-fault Motor Vehicle Act, vehicles are required to be insured to pay up to a limit of $ 15,000 for personal injuries to any one person in any accident in which the operator is legally liable to the injured person. 40 P.S. § 1009.104. This amount of insurance was recovered by Gabriel Pont. Pennsylvania law also requires that all automobile liability insurance policies contain an "uninsured motorist" provision for "the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury." 40 P.S. § 2000(a). The Prudential policy had such a clause, providing $ 15,000 coverage for injury to any one person. The basic question is whether Ruth A. Joell was an "uninsured motorist" despite the fact that her car carried the required minimum liability coverage, which was paid in full to the injured party.

 The policy expressly provides that the uninsured motorist clause will be applicable, only when the injured party cannot recover from the person legally liable because such person either has no liability insurance or has less than the amount required by the state's financial responsibility law:

If you've paid for this coverage (see the Declarations Page), we'll pay persons insured under this part the amount they should have collected as damages for bodily injury from the person or organization responsible for the car accident in which they are injured, but only when they could not collect because:
The person or organization responsible for the accident has no liability insurance or has inadequate (less than the amount required by your state's financial responsibility law) liability insurance coverage at the time of the accident.

 Although insurance policies are generally liberally construed in favor of the insured, it seems impossible to contend with logic that the clause could be applied so as to provide for coverage for Gabriel Pont. Ruth A. Joell's vehicle was not uninsured for liability nor was the $ 15,000 inadequate in the sense of being less than the mandated minimum amount under Pennsylvania law. There is no contention that the policy clause in any way failed to conform with the requirements of Pennsylvania law. As Justice Roberts stated in his concurring opinion in Pattani v. Keystone Insurance Co., 426 Pa. 332, 339, 231 A.2d 402, 405 (1967):

I join in the majority opinion, but I wish to add that the result reached therein is, in my view, mandated not only by the contract provisions of this specific policy but also by the Uninsured Motor Vehicles Statute, Act of August 14, 1963, P.L. 909, 40 P.S. § 2000. An uninsured motorist is one who is without effective insurance coverage and is thus incapable of satisfying the minimum liability imposed by the Legislature.

 Although counsel have cited no Pennsylvania Supreme Court case directly on point, many other courts from other states and federal courts have construed similar uninsured motorist clauses. The great weight of authority is that "uninsured" does not mean "underinsured" provided the liability coverage meets the state's minimum requirements. See plaintiff's brief pages 4 through 7 for citations.

 The major thrust of defendant's argument is not that substantively he is entitled to coverage under Prudential's uninsured motorist clause, but rather that the matter must be determined by arbitration. It would appear that what defendant really hopes is that, even though under the law defendant is not entitled to recover, the arbitrators will, nevertheless, rule in his favor, and such a ruling will either be unappealable, or if ...

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