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NEREIDA MELENDEZ v. PENNSYLVANIA ASSIGNED CLAIMS PLAN AND TRAVELERS INSURANCE COMPANY. APPEAL ESMARALDO CRUZ AND MARGARET HEMINGWAY (04/20/89)

filed: April 20, 1989.

NEREIDA MELENDEZ, APPELLANT,
v.
PENNSYLVANIA ASSIGNED CLAIMS PLAN AND TRAVELERS INSURANCE COMPANY. APPEAL OF ESMARALDO CRUZ AND MARGARET HEMINGWAY



Appeal from the Order entered March 28, 1988, in the Court of Common Pleas of Philadelphia County, Civil, No. 2391 December Term, 1986.

COUNSEL

David Deratzian, Philadelphia, for appellant.

Michael Senoyuit, III, Delaware, for appellee.

Cirillo, President Judge, and Beck and Kelly, JJ.

Author: Beck

[ 384 Pa. Super. Page 49]

This case presents the issue of whether, under the Financial Responsibility Law, an Assigned Claims Plan insurer may deny a claimant's demand for recovery where the claimant has extinguished the insurer's right to subrogation against a tortfeasor. We find that under these circumstances, the insurer may deny recovery to the claimant.

Appellant Nereida Melendez sustained injuries in an automobile accident on December 14, 1984. On December 12, 1986, she filed a complaint seeking first-party benefits from Travelers Insurance Company (Travelers) under the Pennsylvania

[ 384 Pa. Super. Page 50]

Motor Vehicle Financial Responsibility Law, (Financial Responsibility Law), 75 Pa.Cons.Stat.Ann. ยง 1701 et seq. (Purdon Supp.1988). Melendez also filed an action against the alleged tortfeasor, Margaret Hemingway, who was the operator of the vehicle with which Melendez collided. This suit was prosecuted to judgment in an arbitration action. On August 17, 1987, Melendez, without seeking and obtaining approval of Travelers, executed a release in favor of Hemingway.

In March of 1987, Melendez filed an amended complaint against Travelers. Travelers filed a third party suit against additional defendants Margaret Hemingway and Esmeraldo Cruz, the uninsured owner of the vehicle Melendez was operating at the time of the accident. Travelers filed an answer and new matter to Melendez' complaint, and Cruz and Hemingway filed an answer and new matter to Travelers' complaint. Travelers then filed a motion for summary judgment, and Melendez filed a response to this motion. The trial court granted Travelers' motion and Melendez' complaint was dismissed. This appeal followed.

Melendez asserts that the trial court erred in granting Travelers' motion for summary judgment because Melendez' settlement with Hemingway did not discharge Travelers' obligation to pay first-party benefits under the Assigned Claims Plan (ACP).

In reviewing a grant of summary judgment, the Superior Court's function is to determine whether there are genuine issues of triable fact. Bobb v. Kraybill, 354 Pa. Super. 361, 511 A.2d 1379 (1986). In deciding a motion for summary judgment, a court must accept as true all well-pleaded facts in the non-moving party's pleadings, giving the non-moving party the benefit of all reasonable inferences to be drawn therefrom. To uphold summary judgment, there must be not only an absence of genuine factual issues, but ...


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