UNITED STATES DISTRICT COURT, EASTERN DISTRICT OF PENNSYLVANIA
October 8, 1980
TRAVELERS INSURANCE COMPANY
The opinion of the court was delivered by: GILES
Before the court is plaintiff's Motion for Summary Judgment pursuant to Fed.R.Civ.P. 56. Counsel have agreed to all genuine issues of material fact.
For the reasons stated below, plaintiff's motion shall be granted.
In this diversity action, plaintiff, Travelers Insurance Company ("Travelers") seeks a declaratory judgment that its insured, the defendant Michael McDermott, is not entitled to proceed to arbitration on certain insurance claims.
The defendant asserts that his claims fall within the "protection against uninsured motorists" provisions of his contract with Travelers
and should be arbitrated in accordance with the provisions of that contract. On the other hand, Travelers asserts that McDermott's insurance claim is not governed by the uninsured provisions since it is a claim arising out of collision with an under-insured motorist as distinguished from an uninsured motorist.
There is no explicit "under-insured collision" provision in the contract. For purposes of the "uninsured motorist protection" section, the term "uninsured highway vehicle" is contractually defined in relevant part to include a vehicle for which, at the time of the accident, there is no applicable bodily injury liability bond or insurance policy, establishing coverage in at least the amounts specified by the financial responsibility law of the state in which the insured vehicle is principally garaged. Counsel have agreed that the vehicle with which McDermott collided did have at least the minimum statutorily required
The Pennsylvania Supreme Court has not rendered any decision on the issue presented here, although there have been relevant decisions by the Pennsylvania trial courts and intermediate appellate court.
On May 1, 1980, the United States Court of Appeals for the Third Circuit decided Safeco Insurance Co. v. Wetherill, 622 F.2d 685 (1980), addressing the uninsured/under-insured question. In making an independent judgment as to how the Pennsylvania Supreme Court would confront and decide this issue, the Third Circuit analyzed and discussed the Pennsylvania decisions. It held that a vehicle which carries the legally required minimum insurance is not an "uninsured" vehicle and that there is "no basis in such cases to compel arbitration under a policy such as that applicable here." At 689. The court recognized that such an interpretation yields an anomalous result: injured claimants would be in a better position if the tortfeasor's vehicle were totally uninsured rather than under-insured. However, it declined to enter the legislative sphere to alter the perceived legislative "objective" of the financial responsibility statute. The court affirmed the lower court's entry of an injunction preventing the insured from proceeding to arbitration.
The pertinent language of the instant Travelers' policy is virtually identical to that in Safeco.
As in Safeco, Travelers did not consent to arbitrate the dispute but instead filed an action seeking to preclude arbitration. I am bound by Safeco which is dispositive of the extant issue.
Finding there to be no genuine issue of material fact before me, and Safeco to be controlling legal precedent, I must grant plaintiff's Motion for Summary Judgment. Accordingly, declaratory judgment is entered in favor of plaintiff and against defendant.