No. 3586 Philadelphia, 1982, Appeal from the Order Entered on November 16, 1982 in the Court of Common Pleas of Philadelphia County, Civil Division, No. 3084 December Term, 1980
Ralph L. Hose, Ardmore, for Juneja, appellees.
Wilbur L. Kipnes, Philadelphia, for Hall, appellees.
Olszewski, Popovich and Cercone, JJ. Popovich, J., concurs in the result.
[ 337 Pa. Super. Page 462]
Esther Green, plaintiff-appellee, filed this action in declaratory judgment to determine the effect of a cancellation of an insurance policy by defendant Dr. Ish K. Juneja. He had purchased the malpractice policy from defendant-appellant Argonaut Insurance Co., Inc. (Argonaut).*fn1 (In an underlying action, Green sued Dr. Juneja for negligent medical treatment which allegedly resulted in loss of vision in her right eye.) Green filed a Motion for Summary Judgment which the trial court granted and it is from this order that Argonaut appeals.
The basic facts were stipulated. On December 16, 1975, Dr. Juneja submitted an application for medical liability insurance to Argonaut. He was notified on February 19, 1976, that it was accepted and that a policy from January 1 to April, 1976 was in effect. He paid the premium on August 4, 1976. On August 14, 1976, Dr. Juneja wrote to Argonaut and requested cancellation of the aforementioned policy on grounds that he had not practiced medicine during the period in question. (It was stipulated that he did indeed practice medicine at that time.) Without an investigation by Argonaut, his policy was cancelled "flat" as if it were never issued and the premium was applied to a new policy effective July 1, 1976. Then, in December 1977, Green sued Dr. Juneja for allegedly negligent medical care in January and February 1976. It is plaintiff Green who seeks the determination as to whether Dr. Juneja is indeed covered.*fn2
[ 337 Pa. Super. Page 463]
The trial court found, pursuant to Green's Motion for Summary judgment on the pleadings,*fn3 that Argonaut's policy, number PM00707, issued to Dr. Juneja, was in full force and effect during the relevant period, from January 1, 1976, to April 1, 1976, and that the retroactive cancellation of the policy on August 17, 1976, was void and without effect. Essential to the court's reasoning was the mandatory nature of malpractice coverage as set forth in the Health Care Services Malpractice Act, 40 P.S. § 1301.701.*fn4 The court referred to one of the purposes of the Act, to benefit those persons who have "sustained injury or death as a result of tort or breach of contract by a health care provider." 40 P.S. § 1301.102. Thus, it concluded that the basic purpose of the Act, to protect the public, would fail if Argonaut were to be released from its contractual obligations. The court found that Green was a third party beneficiary who would be unjustly deprived of a possible recovery by retroactive cancellation of the policy. The court referred to 40 P.S. § 1301.1002, Cancellation of insurance policy, and found that because Argonaut did not notify the insurance commissioner in accordance with this section, that the cancellation did not occur. Finally, the court found there was no evidence in the record of fraud on Dr. Juneja's part, which Argonaut argues would render the insurance contract void ab initio.
Preliminarily, we note that under Pa.R.C.P. 1035, summary judgment may only be entered where the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Acker v. Palena, 260 Pa. Super. 214, 393 A.2d 1230 (1978).
[ 337 Pa. Super. Page 464]
"In addition, we are mindful that in considering a motion for summary judgment the court must examine the record in the light most favorable to the non-moving party; that the court's function is not to decide issues of fact but merely to determine whether any such issues exist; and that all doubts as to the existence of a genuine issue of material fact must be resolved in favor of the non-moving party [citations omitted]". Taylor v. Tukanowicz, 290 Pa. Super. 581, 586, 435 A.2d 181, 183 (1981).
We are persuaded that the decision of the trial court was correct in that the insurer did not comply with the cancellation procedures of the Health Care Services Malpractice Act, 40 P.S. § 1301.1002, and because of that, the retroactive cancellation ...