Eastern District Federal Court Addresses Statute of Limitations For UM Claims

In the recent case of Liberty Mutual Fire Ins. Co. v. Weisbaum, No. 10-3869 (E.D. Pa. 2011 Schiller, J.), Judge Berle M. Schiller handed down a decision on the rarely seen statute of limitations issue with respect to an uninsured (UM) motorists benefits claim.

In this matter, Liberty Mutual filed a declaratory judgment action seeking a declaration that the claimant was not entitled to UM coverage because the claimant failed to bring his claim before the statute of limitations expired.

The court reaffirmed principle that "[u]nder Pennsylvania law, a UM claim is subject to the four-year statute of limitations for contract claims."  In this regard, the court cited State Farm Mut. Auto. Ins. Co. v. Rosenthal, 484 F.3d 251 (3d Cir. 2007), Boyle v. State Farm Mut. Auto. Ins. Co., 456 A.2d 156, 160-162 (Pa. Super. 1983), and 42 Pa.C.S.A. Section 5525(a)(8).

The court in Liberty Mutual v. Weisbaum also stated that "[a] UM claim accrues when the insured:  (1) is involved in a motor vehicle accident, (2) is injured in the accident, and (3) knows or reasonably should have known of the uninsured status of the owner or operator of the other vehicle involved in the accident." (Citing Clark v. State Farm Mut. Auto. Ins. Co., 599 A.2d 1001, 1005 (Pa. Super.  1991).

In his Opinion, Judge Schiller noted that  the statute of limitations can be officially tolled by the filing of a Petition to Compel Arbitration (citing Boyle, 456 A.2d 162-163).

Interestingly, Judge Schiller stated that the appointment of arbitrators by the parties was not sufficient to automatically toll the statute of limitations (citing with "see" signal Walker v. Providence Ins. Co., Civ. A. No. 97-7455, 1998 WL 195652, at *3 (E.D. Pa. March 31, 1998)(holding that appointment of arbitrator did not toll statute of limitations on underinsured motorist claim)[other citation omitted].

The court separately found that the statute could be tolled where the carrier "fraudulently or deceptively lulled" the insured into inaction on the claim presented.  No such fraud or deception was found to exist in this matter.  Rather, the court found that the facts presented established that the carrier actively sought information from the insured on the UM claim presented and received little cooperation in response.

In ruling in favor of the carrier on the statute of limitations argument in this matter, the court also rejected the claimant's argument of the tolling of the statute of limitations based upon an implied contract to arbitrate as there was no authority to support such an argument.

Anyone desiring a copy of this decision in Liberty Mutual v. Weisbaum, may contact me at dancummins@comcast.net.

Source:  "Case Digests."  Pennsylvania Law Weekly