from the Order Entered July 9, 2015 In the Court of Common
Pleas of Allegheny County Civil Division at No(s): GD
BEFORE: SHOGAN, OLSON and STRASSBURGER, [*] JJ.
James Green, appeals from an order entered on July 9, 2015,
which granted summary judgment in favor of Appellee,
Pennsylvania Property and Casualty Insurance Guaranty
Association (PPCIGA). After the careful consideration, we vacate
and remand for further proceedings.
facts and procedural history in this case are as follows.
Appellant sustained injuries on July 4, 1996 when he received
a gunshot wound to his leg. At the time, Appellant was a
patron at Kong's Night Club, an establishment owned and
operated by Uropa, Inc. (Uropa). George Dankovich
(Dankovich), the club's manager, had possession of the
firearm that discharged and wounded Appellant. During this
period, Uropa carried a commercial general liability policy
issued by Security Indemnity Insurance Company (Security
letter dated September 18, 1996, Appellant's then-counsel
notified Security Indemnity that a claim had accrued to
Appellant under the Uropa policy. On September 24, 1996,
Security Indemnity advised that it would neither defend nor
indemnify Uropa with respect to Appellant's claim
pursuant to the "assault and battery" and
"expected or intended injury" exclusions within the
policy. Security Indemnity further advised that Uropa
breached its duty to give notice of the claim within a
reasonable period of time.
December 10, 1996, Appellant filed a complaint against Uropa
and Dankovich seeking recovery for bodily injuries arising
from the gunshot wound. The complaint alleged three counts of
negligence against the defendants. On December 30, 1996,
counsel for Dankovich sent a letter to Security Indemnity,
together with a copy of the complaint, requesting that the
insurer provide a defense against Appellant's claims on
grounds that the shooting was accidental and Dankovich was
acting in the course and scope of his employment with Uropa
when the incident occurred.
Indemnity replied to Dankovich's counsel by letter dated
January 7, 1997. The insurer's reply enclosed a copy of
its September 24, 1996 coverage denial letter with respect to
Uropa and explained that the denial extended to Dankovich.
entered a default judgment against Dankovich on February 12,
1997. Thereafter, a judgment in the amount of $1, 000, 000.00
was entered on April 10, 1997. In pursuit of his recovery,
Appellant filed a writ of execution against both Dankovich
and Security Indemnity, as garnishee. Appellant also served
garnishment interrogatories upon Security
15, 1997, Security Indemnity filed a notice of removal,
removing the garnishment action to the United States District
Court for the Western District of Pennsylvania. While the
action was pending in federal court, Security Indemnity filed
a federal declaratory judgment action.
8, 1997, the federal court remanded the matter back to state
court, concluding that the garnishment action necessarily
involved an inquiry into the nature of Dankovich's
conduct, which lay at the center of the underlying state
court litigation. By separate order on March 10, 1998, the
federal court dismissed Security Indemnity's declaratory
judgment action, noting that the issues in the declaratory
judgment action were identical to the claims in the pending
2003, following remand to state court, Appellant's
garnishment action, along with all other litigation pending
against Security Indemnity, became subject to a stay order
entered by the New Jersey Superior Court, which placed the
insurer into "rehabilitation" status. On June 30,
2004, Security Indemnity was declared insolvent and all
claimants pursuing relief against the insurer were required
to file proof of claim forms with a liquidator. At this time,
no court had ever reached the merits of Appellant's
coverage claims against Security Indemnity.
timely filed his proof of claim form with the liquidator for
Security Indemnity on or around October 8, 2004.
Subsequently, in April 2007, Appellant's former counsel
wrote PPCIGA's counsel regarding the status of
Appellant's liquidation claim. Counsel for PPCIGA responded
that she represented PPCIGA, not Security Indemnity.
PPCIGA's counsel further informed counsel for Appellant
that PPCIGA did not have a claim established for Appellant
and that Appellant should work with the liquidator for
Security Indemnity. Following this exchange, Appellant's
counsel took no further action in pursuing legal redress
on March 11, 2011, Appellant received notice of a final claim
determination from Security Indemnity's liquidator. The
notice advised Appellant that payment of his claim was
"priority 4" and indicated that his claim "is
being adjudicated by [PPCIGA] pursuant to statute."
Although the notice set forth a mechanism through which to
appeal the liquidator's determination, Appellant took no
further legal action against the liquidator. On September 26,
2012, PPCIGA denied coverage of Appellant's claim.
initiated this declaratory judgment action against PPCIGA by
filing a complaint on August 15, 2013. An amended complaint
was filed October 25, 2013. Appellant alleged that PPCIGA is
obligated to pay him $1, 000, 000.00 based upon the default
judgment obtained against Dankovich on April 10, 1997. PPCIGA
answered Appellant's complaint on December 23, 2013.
the parties had an opportunity to conduct discovery,
Appellant moved for summary judgment on March 5, 2015. PPCIGA
filed its own motion for summary judgment on May 5, 2015. The
trial court convened oral argument on June 16, 2015.
Thereafter, the trial court granted summary judgment in favor
of PPCIGA on July 9, 2015. The court denied Appellant's
motion by separate order entered on the same day.
trial court offered three distinct grounds for its rulings on
the parties' motions. Relevant to the statute of
limitations, the court reasoned that Appellant's cause of
action against PPCIGA accrued no earlier than September 24,
1996, the date of Security Indemnity's coverage denial
letter with respect to Uropa, and no later than April 25,
2007, the date counsel for PPCIGA sent a letter to
Appellant's former counsel advising that the association
had not established a claim in this matter. Since Appellant
did not file his complaint until August 15, 2013, the trial
court concluded that the action is barred by the applicable
limitations period. See Trial Court Opinion,
11/13/15, at 6.
to the Pennsylvania Property and Casualty Insurance Claim
Act, 40 P.S. § 991.1801, et seq. (the Act), the
trial court also determined that Appellant did not possess a
covered claim. Several findings contributed to this
conclusion. First, the court found that Appellant was not an
insured under the Security Indemnity policy. Additionally,
filed a lawsuit against Dankovich to recover for injuries,
the court reasoned that Appellant could not be considered a
claimant under the Act because Security Indemnity denied
coverage to Dankovich on January 7, 1997. Hence, after noting
that "[n]either Dankovich nor [Appellant] pursued any
other legal action or claim against Security Indemnity[,
]" the court held that, "at the time of Security
Indemnity's insolvency, June 30, 2004, Dankovich was not
an insured under the Security Indemnity policy and
[Appellant's] unpaid claim [was] not within the coverage
of an insolvent insure[r]'s policy." Id. at
4 (internal quotations omitted).
and apart from the covered claim and statute of limitations
issues, the trial court concluded that issues of fact
surrounding the circumstances of the shooting and
Appellant's acquisition of a default judgment against
Dankovich would preclude entry of summary judgment in
Appellant's favor. Id. at 4. This timely appeal
raises two issues for our consideration in this appeal.
Whether Appellant's declaratory judgment action against
PPCIGA [is] barred by the statute of limitations when (a) it
was filed within four years of PPCIGA's denial of his
claim, (b) it was filed within four years of Appellant's
receipt of a notice of final claim determination from the
liquidator of the insolvent insurance company [(Security
Indemnity)], (c) Appellant was actively litigating a
garnishment action against the insurance company[, Security
Indemnity, ] when it became insolvent, and (d) [Appellant]
timely filed a proof of claim with the liquidator of the
insolvent company to preserve this claim?
Whether an individual has a covered claim pursuant to the
Pennsylvania Property and Casualty Insurance Guaranty
Association Act, 40 P.S. § 1801, et seq.[, ]
when he has a valid claim under a Pennsylvania insurance
policy, obtained a judgment against an insured and thereafter
filed a writ of execution and garnishment action against the