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filed: December 9, 1987.


Appeal from the Judgment of the Court of Common Pleas of Philadelphia County, Civil at No. 4658 July Term 1982.


Alfred W. Putnam, Jr., Philadelphia, for appellant.

Charles W. Craven, Philadelphia, for appellee.

Cavanaugh, Rowley and Montemuro, JJ.

Author: Montemuro

[ 369 Pa. Super. Page 549]

This is an appeal by the Southeastern Pennsylvania Transportation Authority (hereinafter "SEPTA") from an order of the Court of Common Pleas of Philadelphia County, denying SEPTA's request for post trial relief from the trial court's initial order directing a verdict in favor of appellee Chubb and Sons, Inc. (hereinafter "Chubb") under Pennsylvania's No-fault Motor Vehicle Insurance Act.*fn1 (hereinafter "No-fault Act"). We affirm.

The events leading up to this action began on August 15, 1980 when Thomas McGilley, a cab driver, pulled into a line of cabs at a cab stand in front of the Warwick Hotel in Philadelphia. The cab that McGilley was driving was owned by Mar-Jan Taxi Company, which insured the cab under a policy with Chubb.*fn2 When Mr. McGilley pulled into the cab stand at approximately 10:25 in the morning, his plan was to pick up a short fare before meeting his partner, James Burns, for lunch at around noon. The rendezvous was to take place at a small restaurant approximately fifty (50) feet away from the Warwick Hotel, at which time, Mr. McGilley would exchange the cab for Mr. Burns' private

[ 369 Pa. Super. Page 550]

    automobile and proceed to take his family to the New Jersey shore.

After waiting in line for approximately twenty minutes, Mr. McGilley turned his ignition key to off, got out, and walked to the cab in front of his to "bum a cigarette" from the driver. As he was chatting with the driver about the day's business, a SEPTA bus approached from the rear. When warned by the driver of the other cab about the oncoming bus, Mr. McGilley attempted to make his way to the curb, but unfortunately to no avail. The bus struck him resulting in the loss of his leg.

Mr. McGilley filed an action in trespass against SEPTA which was settled.*fn3 However, the settlement with SEPTA excluded Mr. McGilley's medical expenses. Consequently, he filed a claim against the Mar-Jan Taxi Company, his employer, under the Workmen's Compensation Act.*fn4 Because Mar-Jan failed to carry such insurance, Mr. McGilley, who owned no car and therefore carried no automobile insurance of his own, filed suit under the No-fault Act against Chubb, Mar-Jan's no fault insurance carrier.*fn5 Alternatively, Mr. McGilley sued SEPTA, a self-insured entity, also under the No-fault Act.

[ 369 Pa. Super. Page 551]

A trial was held before a jury. Mr. McGilley was the sole witness presented and at the close of his testimony all parties moved for a directed verdict. The stipulation of facts between the parties*fn6 and the interim settlement agreement,*fn7 when read together, left a purely legal question, that is, whether SEPTA or Chubb was the obligor responsible for compensating Mr. McGilley under the priorities established in Section 204(a) of the No-fault Act. The trial court directed a verdict in favor of Chubb and against SEPTA, finding that under the No-fault Statute SEPTA was the obligor responsible for paying basic loss benefits to Mr. McGilley. SEPTA's post-trial motion was denied and this appeal followed.

The question before us today is whether the trial court properly concluded that SEPTA was responsible for the payment of basic loss benefits under the priority provisions of Section 204(a) of the No-fault Act, 40 P.S. § 1009.204(a). The resolution of this question requires us to determine: (1) Whether McGilley was "occupying" the cab at the time of the accident and (2) Whether the Act's definition of an "insured" preempts the definition of an "insured" found in the Chubb insurance policy for purposes of determining the applicable security under Section 204(a).

[ 369 Pa. Super. Page 552]

Initially, we note that our scope of review of a trial court's decision to direct a verdict is limited to a determination of whether there exists "an abuse of discretion or error of law which controlled the outcome of the case." Jozsa v. Hottenstein, 364 Pa. Super. 469, 528 A.2d 606 (1987), citing Page 552} McDevitt v. Terminal Warehouse Co., 304 Pa. Super. 438, 442, 450 A.2d 991, 993 (1982).

In McMullin v. Dallago, 353 Pa. Super. 527, 510 A.2d 787, (1986), we explained the purpose behind the enactment of Pennsylvania's No-fault Insurance Act, as well as the types of insurance coverage required on vehicles registered in the Commonwealth:

The stated purpose of the Pennsylvania No-fault Motor Vehicle Insurance Act was "to establish at reasonable cost to the purchaser of insurance a Statewide system of prompt and adequate basic loss benefits for motor vehicle accident victims and the survivors of deceased victims." 40 P.S. § 1009.102(b). To accomplish this purpose, the Act required every vehicle registered or operated in Pennsylvania to be insured, either by a policy of insurance, or by self-insurance. 40 P.S. § 1009.104. This insurance had to provide for the payment of basic loss benefits and for the payment of statutorily-designated sums which the owner or authorized operator may be liable to pay as damages for personal injury to any one person and for property destruction. 40 P.S. § 1009.104(a); Tierney v. Pennsylvania Assigned Claims Plan, 319 Pa. Super. 299, 466 A.2d 168 (1983). Thus, an owner or authorized operator, driving an insured vehicle, who was injured in an automobile accident was to be paid basic loss benefits by his insurer whether he was at fault or not. At the same time he was covered up to the limits of his insurance policy for any tort liability he may have incurred. 40 P.S. § 1009.111.

Id., 353 Pa. Superior Ct. at 530-31, 510 A.2d at 789-90.

Section 201 of the No-fault Act entitles any "victim"*fn8 of an accident or survivor of a deceased victim to recover "basic loss benefits"*fn9 in accordance with the ...

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