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DANA A. CHIESA v. A.M. FETCHKO (08/12/83)


filed: August 12, 1983.


No. 117 Pittsburgh, 1982, Appeal from the Order entered January 19, 1982, Court of Common Pleas, Allegheny County, Civil Action, Law at No. GD 81-00477.


Bradford Dorrance, Harrisburg, for appellant.

William S. Schweers, Pittsburgh, for appellees.

Brosky, Johnson and Montgomery, JJ. Brosky, J., files a concurring opinion.

Author: Johnson

[ 318 Pa. Super. Page 190]

The Pennsylvania Department of Public Welfare (the Department) appeals the Order of the trial court entered January 19, 1982, denying their Petition to Intervene.

The record indicates that plaintiff Dana A. Chiesa filed a medical malpractice complaint against the defendant doctors in February of 1980 under the Health Care Services Malpractice Act (HCSMA), 40 P.S. § 1301.101 et seq.*fn1 The action was subsequently transferred to the Court of Common Pleas in December of 1980. Plaintiff, who was receiving both Medicaid and cash assistance from the Department, did not notify the Department of the pendency of this action. By letter dated July 14, 1981, the Department requested information from plaintiff's counsel concerning any personal injury claim and informing counsel of his duty to notify the Department of such a claim.*fn2 A reply dated September 4, 1981 was sent by plaintiff's counsel to the Department, stating that the HCSMA, specifically section 602,*fn3 required no notice to the Department, nor was the Department entitled to any right of subrogation.

Following this exchange of correspondence, the claim was settled and, on October 16, 1981, the docket marked "settled and discontinued." The Department then presented a Petition

[ 318 Pa. Super. Page 191]

    to Intervene*fn4 to the court. The trial court ordered the settlement monies, $50,000, placed in escrow. The parties then stipulated to the Department's claims of $5,807.95 for medical assistance and $3,996.50 in cash assistance. The Department's Petition was denied by court order entered January 19, 1982.

The Department on appeal seeks review of the trial court's determination that (1) no irreconcilable conflict exists between section 1409 of the Fraud Abuse and Control Act and section 602 of the HCSMA, (2) that section 602 of the HCSMA prevails over section 1409 of the Fraud Abuse and Control Act and (3) that said section 602 does not conflict with sections 1974 or 1975 of the Support Law.*fn5

We must first determine whether the Order appealed from is final or interlocutory.*fn6

An order denying intervention is not appealable unless it "would be a practical denial of relief to which the petitioner for intervention is entitled and can obtain in no other way." Frey's Estate, 237 Pa. 269, 271, 85 A. 147, 148 (1912). See Annot., 15 A.L.R.2d 33.

Richard Held Builders, Inc. v. A.G. Allebach, Inc., 266 Pa. Super. 101, 103, 403 A.2d 113, 114 (1979); see also Boise Cascade Corp. v. East Stroudsburg Savings Association, 300 Pa. Super. 279, 446 A.2d 614 (1982).

[ 318 Pa. Super. Page 192]

Unless we consider the merits -- or "ramifications" -- of a case, we cannot tell whether an order denying a petition to intervene is "a practical denial of relief to which the petitioner for intervention is entitled." See, e.g., Taub v. Page 192} Merriam, 251 Pa. Superior Ct. 572, 380 A.2d 1245 (1977) (deciding appeal); Richard Held Builders, Inc. v. A.G. Allebach, Inc., 266 Pa. Superior Ct. 101, 403 A.2d 113 (1979) (quashing appeal).

Boise Cascade Corp. v. East Stroudsburg Savings Association, 300 Pa. Super. at 282, 446 A.2d at 615 (footnote omitted).

The record indicates that the trial court ordered the settlement monies placed into escrow and that the parties stipulated to the sums paid to the plaintiff by the Department by way of medical and cash assistance. Therefore, as a practical matter, the undisputed res in controversy is being held by the court pending this appeal. The trial court, pursuant to its opinion dated January 11, 1982,*fn7 held that the Department was not entitled to the monies as a matter of law. The Order of the trial court denying the Department's Petition to Intervene is therefore a practical denial of relief.

The second part of the test for appealability is whether the Department can obtain relief by any other method. The Department has the right, under 62 P.S. § 1974, to sue a beneficiary for reimbursement of benefits paid by the Department. See Commonwealth of Pennsylvania, Department of Public Welfare v. Livingood, 22 Pa. Commw. 530, 349 A.2d 816 (1976); see also Shearer v. Moore, 277 Pa. Super. 70, 419 A.2d 665 (1980) (Commonwealth, in furtherance of efforts to obtain reimbursement for medical assistance payments, may sue recipient of assistance in court of common pleas). Also, the Fraud Abuse and Control Act, 62 P.S. § 1409(b)(1),*fn8 states that the Department may sue a tortfeasor

[ 318 Pa. Super. Page 193]

    or his insurer directly for recovery of benefits paid on behalf of a beneficiary who has suffered injury. However, as stated previously, the trial court held that the Department was not entitled to recover benefits from the plaintiff in the instant case. We hold that, as a practical matter, the Department has no legal alternative*fn9 to intervention in the instant case. The order denying the Department's Petition to Intervene is, therefore, appealable.

We now turn to the issues raised on appeal.

Initially, it must be noted that all three issues raised by the Department involve the force and effect of section 602 of HCSMA. The record indicates the action was transferred to the Court of Common Pleas, pursuant to an Election of Jurisdiction, by the plaintiff.*fn10 The record also indicates that the controversy was settled after the transfer.

We therefore must initially determine whether section 602 of the HCSMA is applicable in a situation involving the settlement of a malpractice action after transfer of the action from the jurisdiction of the HCSMA to the common pleas court.

[ 318 Pa. Super. Page 194]

It is clear that since the holding in Mattos v. Thompson, supra, the HCSMA no longer has original exclusive jurisdiction over claims for loss or damage, arising from the furnishing of medical services, against health care providers in Pennsylvania. Therefore, where such an action is either originally instituted in the court of common pleas or transferred to said court from the jurisdiction of the HCSMA pursuant to the Opinion of the Attorney General, 15 D & C 3d 585 (1980), certain other provisions of the HCSMA will no longer apply to the action.*fn11

The provision in question states:

§ 1301.602 Reduction of award by other benefits

The loss and damages awarded under this act shall be reduced by any public collateral source of compensation or benefits. A right of subrogation is not enforceable against any benefit or compensation awarded under this act or against any health care provider or its liability insurer. (Emphasis added)

An award has been defined as the decision or determination rendered by arbitrators or commissioners upon a controversy submitted to them. Black's Law Dictionary (5th ed. 1979). See also 3 P.L.E. Arbitration § 12 (an award is the final judgment or decision pronounced by the arbitrators in settlement of the controversy submitted to them). Also, it has been held that an award is a judgment of a tribunal selected by the parties to determine matters actually in variance between them. Keiser v. Berks County, 253 Pa. 167, 97 A. 1067 (1916).

In the instant case, the settlement was made while jurisdiction was held by the court of common pleas, not the HCSMA. Although certain provisions of the HCSMA remain

[ 318 Pa. Super. Page 195]

    in force in such circumstances, we hold that section 602 is inapplicable to the instant case, as no award was involved.

In Marquez v. Hahnemann Medical College and Hospital of Philadelphia, 56 Pa. Commw. 188, 424 A.2d 975 (1981), an action for damages under the HCSMA was settled. Plaintiff's attorneys sought approval of the settlement and the fixing of counsel fees from the court of common pleas, which was granted by order of court. The settlement was then submitted to the Administrator of the HCSMA for approval, pursuant to section 307(b)*fn12 of the Act, because the action involved a minor. The Administrator declined to approve the settlement until attorneys' fees were put into conformance with section 604(a) of the Act. On appeal, the commonwealth court held that the court of common pleas had no jurisdiction over the case because the action was within the exclusive jurisdiction of the HCSMA and that the common pleas court's application of the Rules of Civil Procedure concerning settlement did not apply.

We believe the inverse of this holding to be applicable to the instant appeal; where the court of common pleas has jurisdiction over a medical malpractice claim, those sections of the HCSMA which concern only actions for arbitration within the ambit of the Act are inapplicable.

As set forth in footnote 8 supra, 62 P.S. § 1409(b)(1) clearly gives the Department of Public Welfare the right to recover the reasonable value of benefits provided a beneficiary from a tortfeasor or tortfeasor's insurer.

Section 1409(b)(5) states:

(5) If either the beneficiary or the department brings an action or claim against such third party or insurer, the beneficiary or the department shall within thirty days of

[ 318 Pa. Super. Page 196]

    filing the action give to the other written notice by personal service, or certified or registered mail of the action or claim. Proof of such notice shall be filed in such action or claim. If an action or claim is brought by either the department or beneficiary, the other may, at any time before trial on the facts, become a party to, or shall consolidate his action or claim with the other if brought independently.

The instant action never reached trial on the facts. Therefore, section 1409(b)(5) appears to permit the Department to become a party to or to consolidate their action with that of the plaintiff.

Furthermore, section 1409(b)(9) states that "[n]o judgment, award or settlement in any action where the department has an interest, shall be satisfied without first giving the department notice and opportunity to perfect and satisfy his [sic] lien." (Emphasis added.)

It is clear that the Department of Public Welfare has the right to recover the benefits paid, on behalf of plaintiff, from the defendants or their insurer. Plaintiff was required to notify the Department within 30 days of the institution of the action in the instant case.*fn13 The Department also had the right to become a party to the action. Because the Department was not given notice of the action, its Petition to Intervene should have been granted.

The Order entered January 19, 1982 is reversed and the case remanded for further proceedings consistent with this opinion. Jurisdiction is not retained.

BROSKY, Judge, concurring:

I concur in the result. But I differ with the rationale employed in the majority opinion. It concludes that the Health Care Services Malpractice Act (HCSMA) provision in

[ 318 Pa. Super. Page 197]

    question here, 40 P.S. § 1301.602, is inapplicable to the case sub judice because it uses the word "award" and the case before us was settled. In my view this treatment is unnecessary, creates and undesirable method of deciding future cases in this area, and is used to draw a possibly erroneous conclusion.

First, it is unnecessary to rely upon this difference to reach the conclusion that the provisions of the HCSMA do not apply to actions in the Court of Common Pleas. Absent a clear statutory expression to the contrary, there is no reason to suppose that procedures set up under the HCSMA would have any effect on actions pursued in the Courts of our Commonwealth. In other words, it need not be proven that § 1301.602 does not govern in our courts. Quite to the contrary, the burden would be on the party seeking to establish that § 1301.602 does reach into the courtroom.

The fact that one of the many provisions of the HCSMA may carry over does not alter this basic presumption. There would appear to be quite definite reasons for holding that one of the parts of the HCSMA have currency in malpractice actions in our courts. 40 P.S. § 1301.701(d).*fn1 This would, however, be the exception to the rule.

Second, I suggest that the majority opinion creates an unfortunate uncertainty as to which of the other provisions of the HCSMA may carry over into the courts, or, indeed, whether this provision would carry over under different facts. It does this by relying upon a specific difference between the HCSMA section in question and the facts of this case to decide that the section was not applicable here. The issue could have been resolved by asking whether there was any indication that HCSMA provisions in general should apply to actions in the courts. This side effect of the majority opinion is all the more regrettable as it is wholly unnecessary to the disposition of the case before us. There is no need for the question before us to be answered by specific arguments supporting the non-applicability of § 1301.602. As noted above, it is its applicability which

[ 318 Pa. Super. Page 198]

    would require a convincing argument. Without such an argument, its non-applicability would be the inevitable conclusion. In reaching the issue in the manner it has, the majority has utilized not only an unnecessary approach, but also a counter-productive one.

Third, I also have doubts about the accuracy of the implied distinction made between awards and settlements under the HCSMA. If, indeed, the action had remained under the HCSMA and had been settled, it is not at all clear to me that the provisions of § 1301.602 would not apply. The Act itself does not make an explicit distinction between an award and a settlement. Yet the majority opinion would reach such a situation. However, I do not believe that this question is presented by the facts of this case. Therefore, I do not make any firm conclusion myself on this matter; just as I do not think that the majority opinion should reach it.

In conclusion, the majority opinion establishes an unjustifiable procedure of having to establish the non-applicability of HCSMA provisions in court actions. It also makes an unwarranted and possibly erroneous holding as to settlements under the HCSMA.

I concur in the result.

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