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YODER v. DRESSLER

January 7, 1981

Jesse Jason YODER and Gladys Yoder, husband and wife, individually and as parents and natural guardian of Naomi Yoder, a minor et al., Plaintiffs,
v.
Wayne E. DRESSLER and Denise L. Dressler, Defendants



The opinion of the court was delivered by: RAMBO

MEMORANDUM

Before the court are cross motions for summary judgment which necessitate the resolution of a conflict of law. Plaintiffs, residents of Delaware, were involved in a motor vehicle collision on April 24, 1977 in Juniata County, Pennsylvania. Denise L. Dressler, a Pennsylvania resident, was the driver of the other vehicle involved in the accident. Robert and Joseph Yoder died as a result of injuries from the crash. Jesse, Gladys and Naomi Yoder were injured. The Yoders were insured under a policy with Nationwide Mutual Insurance Company (Nationwide). Nationwide paid first party no-fault benefits to the Yoders.

 Erie Insurance Exchange (Erie) carried the Dressler motor vehicle insurance. On June 27, 1979 Erie settled claims made by the estates of Robert and Joseph Yoder. Subsequently, Erie was notified by Nationwide, in letters dated August 12, 1977 and March 3, 1978, that the latter expected reimbursement for the no-fault benefits paid to the Yoders. In February of 1979 Jesse and Gladys Yoder settled the remaining claims of the family against Denise Dressler. Three months later this lawsuit was initiated in the Yoders' names to assert Nationwide's claim for payments it made to the Yoders covering medical, funeral and burial expenses.

 The parties do not dispute that, under the Delaware law applicable at the time of the accident, Nationwide had the right to bring suit to recover the expenses at issue. It is also undisputed that Pennsylvania's No-Fault Motor Vehicle Insurance Act *fn1" prohibits subrogation for amounts paid by the no-fault carrier to its insured as first-party benefits. 40 P.S. § 1009.111. There is no agreement on whether Delaware or Pennsylvania law governs this issue. The court finds that Pennsylvania law controls the issue of subrogation, and that subrogation for the amounts claimed is prohibited by Pennsylvania law. It will, therefore, grant summary judgment in favor of the defendants for the reasons which follow.

 A federal court in a diversity action is required to apply the conflict of law rules of the forum state. Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1941). Pennsylvania has by statute directed which state law should determine the potential existence of liability when a lawsuit arises out of the operation of a motor vehicle in the Commonwealth. The No-Fault Motor Vehicle Insurance Act contains a section governing motor vehicles in interstate travel. 40 P.S. § 1009.110. A sub-section of that section provides:

 (c) Applicable law.

 
(1) The basic loss benefits available to any victim or to any survivor of a deceased victim shall be determined pursuant to the provisions of the state no-fault plan for motor vehicle insurance in effect in the state of domicile of the victim on the date when the motor vehicle accident resulting in injury occurs. If there is no such state no-fault plan in effect or if the victim is not domiciled in any state, then basic loss benefits available to any victim shall be determined pursuant to the provisions of the state no-fault plan for motor vehicle insurance, if any, in effect in the state in which the accident resulting in injury occurs.
 
(2) The right of a victim or of a survivor of a deceased victim to sue in tort shall be determined by the law of the state of domicile of such victim. If a victim is not domiciled in a state, such right to sue shall be determined by the law of the state in which the accident resulting in injury or damage to property occurs.

 First, it must be noted that an out-of-state victim's right to sue in tort for motor vehicle injuries inflicted in Pennsylvania is determined by the law of his state of domicile without regard to whether that state has a no-fault plan. The Yoders' right to sue a tortfeasor is controlled by Delaware law. Under the law of their home state they could not present evidence and recover the special damages which are the subject of this lawsuit. 21 Del.Code § 2118(g).

 The question of which state law governs the payment of basic loss benefits, the claim asserted in the case sub judice, must be answered by reference to the type of motor vehicle insurance plan in existence in the victim's state of domicile. It is not the title or name of the foreign state's plan that determines whether it is a no-fault plan under Pennsylvania law. The Commonwealth adopted regulations in 1975 which specify the components that a foreign state's no-fault act must contain in order to be considered a no-fault plan for purposes of applying Pennsylvania law. The regulations direct:

 
(2) A "state no-fault plan' is defined to be a plan which contains the following elements:
 
(i) compulsory or mandatory automobile insurance,
 
(ii) first party benefits, and
 
(iii) a restriction on the right to bring action for noneconomic detriment, or a relevant change in the evidentiary rules of practice and proof with respect to these actions. ...

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