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THOMAS MURPHY v. PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY (12/30/83)

decided: December 30, 1983.

THOMAS MURPHY
v.
PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY, APPELLANT



No. 85 E.D. Appeal Docket, 1983, Appeal from Order of the Superior Court at No. 194 Philadelphia, 1981, entered April 8, 1983, Pa. Super. , Roberts, C.j., and Nix, Larsen, Flaherty, McDermott, Hutchinson and Zappala, JJ. Flaherty, J., joins and files a concurring opinion in which Nix, McDermott and Hutchinson, JJ., join. Larsen, J., files a dissenting opinion.

Author: Roberts

[ 503 Pa. Page 530]

OPINION OF THE COURT

At issue on this appeal is the timeliness of an action brought against an insurer under the Pennsylvania No-fault Motor Vehicle Insurance Act, Act of July 19, 1974, P.L. 489, § 101 et seq., 40 P.S. § 1009.101 et seq. (Supp.1983), by an insured who seeks to recover the cost of medical services allegedly rendered over a period in excess of two years as a result of an automobile accident. The Superior Court reversed an order of the Court of Common Pleas of Philadelphia which had granted summary judgment in favor of the insurer, and remanded the record for trial on the entire sum claimed. We vacate the order of the Superior Court and hold, in accordance with section 106(c)(1) of the No-fault Act, that the action was untimely insofar as it sought to recover the cost of medical services rendered more than two years prior to the date on which the action was commenced.

The present action was commenced by appellee Thomas Murphy on May 18, 1979, by the filing of a complaint against appellant Prudential Property and Casualty Insurance Company. Appellant was the insurer under a policy of insurance issued to appellee's sister pursuant to the No-fault Act. Appellee claimed to have resided with his sister on March 16, 1977, the date of an automobile accident which allegedly required appellee to undergo extended medical treatment, performed by five different physicians. The complaint alleged that appellant had refused to make payment of bills totaling $1265 owed to a medical laboratory and the five physicians. Appellee's claims had been formally refused by appellant on April 26, 1979, less than one month prior to the date that the present action was commenced.

Appellant filed an answer and new matter, which averred that appellee and his counsel had failed to submit information

[ 503 Pa. Page 531]

    to appellant concerning the alleged cause of action in a timely manner, and that appellee's action was time-barred. Neither party made copies of the bills for medical services a part of the record, although the record does contain appellee's answers to appellant's request for admissions, in which appellee acknowledged that he had received medical treatment on dates more than two years prior to the commencement of the action from each of the physicians who were named in the complaint as having provided covered services.

The governing portion of section 106(c)(1) of the No-fault Act requires an alleged victim seeking to recover a "loss" to commence an action against a no-fault carrier

"not later than two years after the victim suffers the loss and either knows, or in the exercise of reasonable diligence should have known, that the loss was caused by the accident, or not later than four years after the accident, whichever is earlier."

40 P.S. § 1009.106(c)(1).*fn* A "loss" is defined as an "accrued economic detriment resulting from injury arising out of the maintenance or use of a motor vehicle consisting of, and limited to, allowable expense [(which includes medical expenses)], work loss, replacement services loss, and survivor's loss." § 103, 40 P.S. § 1009.103. Section 106(a)(1) provides that "[n]o-fault benefits are payable monthly as loss accrues. Loss accrues not when injury occurs, but as allowable expense, work loss, replacement services loss, or survivor's loss is sustained." 40 P.S. § 1009.106(a)(1).

In light of these latter provisions of the No-fault Act, particularly section 106(a)(1), which sets forth the legislative concept that a loss "accrues" as an expense is

[ 503 Pa. Page 532]

"sustained," it is evident that an alleged victim of an automobile accident suffers a loss for purposes of section 106(c)(1) on the date that an allegedly covered service was rendered. Accord, Platts v. Government Employees Insurance Co., 301 Pa. Super. 379, 447 A.2d 1017 (1982). We hold, therefore, that the governing portion of section 106(c)(1) of the No-fault Act requires a claimant seeking to recover the cost of an allegedly covered service to commence suit within two ...


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