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CHARLES R. PASTERNAK v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY (01/31/86)

filed: January 31, 1986.

CHARLES R. PASTERNAK, APPELLANT,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, APPELLEE



Appeal from Order of the Court of Common Pleas, Civil Division, of Allegheny County, No. GD-81-04987.

COUNSEL

Mark F. Geary, Pittsburgh, for appellant.

Frank M. Gianola, Pittsburgh, for appellee.

Wieand, Del Sole and Hester, JJ.

Author: Wieand

[ 350 Pa. Super. Page 449]

Charles R. Pasternak was injured when, on June 13, 1977, his motorcycle was struck by an automobile owned and operated by Robert A. Heckman. Heckman's liability carrier

[ 350 Pa. Super. Page 450]

    paid $15,000, its policy limits, in settlement of Pasternak's claim. Pasternak then filed a claim against his insurance carrier, State Farm Mutual Automobile Insurance Company, under the uninsured motorist provisions of the policy. State Farm denied the claim. Pasternak then requested arbitration pursuant to policy provisions by which the parties had agreed to resolve their disputes by statutory arbitration. A hearing was held before arbitrators on July 29, 1980. At the hearing, the parties specifically agreed that the Arbitration Act of 1927 was applicable to and controlling of the proceedings. In January, 1981, the arbitrators awarded Pasternak the sum of $45,000.*fn1 The trial court, on petition of State Farm, set aside the award on December 22, 1983. It did so because the award was contrary to law. The court held that the uninsured motorist feature of the policy did not have application where the third party motorist was "underinsured." Pasternak appealed.

The contract between the parties, as we have observed, provided for arbitration under the Act of 1927. At the hearing before arbitrators the parties also agreed that the arbitration was being held under the Act of 1927. By the time the award was entered in January, 1981, however, the Act of 1927 had been repealed and replaced by the Uniform Arbitration Act, 42 Pa.C.S. § 7301 et seq. We conclude that under these circumstances, the Act of 1927 was nevertheless controlling. See: Vogel v. National Grange Mutual Insurance Co., 332 Pa. Super. 384, 386-387 n. 2, 481 A.2d 668, 669 n. 2 (1984) (law extant at time cause of action arises governs subsequent arbitration). See also: McDonald v. Keystone Insurance Co., 313 Pa. Super. 404, 407 n. 3, 459 A.2d 1292, 1294 n. 3 (1983). Therefore, the trial court could set aside or modify the award as being contrary to law. See: Act of April 27, 1927, P.L. 381, No. 248, § 11(d), 5 P.S. § 171(d); State Farm Mutual Automobile Insurance Co. v. Williams, 481 Pa. 130, 392 A.2d 281 (1978).

[ 350 Pa. Super. Page 451]

Even if we look to the Uniform Arbitration Act to determine our scope of review, the result must be the same. Section 501(b) of the Uniform Arbitration Act of October 5, 1980, P.L. 693, which has been reprinted as part of the Historical Note at 42 Pa.C.S. § 7302, provides as follows:

The provisions of 42 Pa.C.S. § 7302(d)(2) (relating to special application) shall be applicable to any non-judicial arbitration pursuant to:

(1) An agreement made prior to the effective date of this act which expressly provides that it shall be interpreted pursuant to the law of this Commonwealth and which ...


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