Thursday, December 22, 2011

Pennsylvania Supreme Court Decides Important Property Damage Subrogation Issue

In what they termed a case of first impression, the Pennsylvania Supreme Court issued a decison on December 21, 2011 in the case of Jones v. Nationwide, No. 61 EAP 2010 (Pa. Dec. 21, 2011)(Majority Opinion by Baer, J.)(Eakin, J., concurring), affirming the practice of property damage carriers returning deductibles to insureds on a "pro rata" basis after a subrogation recovery against a third party tortfeasor.

The court rejected the plaintiff insured's contention that this practice violate the "made whole" doctrine which according to the plaintiff required that she receive her whole deductible back.  The Pennsylvania Supreme Court ruled that the "made whole" doctrine did not apply to the collision coverage at issue in this case.  Accordingly, the court dismissed the insured's class action.

The Majority Opinion (Baer, Castille, Saylor, Todd, McCaffery, Orie Melvin, JJ) can be viewed here.

The Concurring Opinion by Justice Eakin, agreeing with the Majority's holding but reaching it on different grounds, can be viewed here.

I send thanks to Attorney Will Sylianteng of the Philadlephia office of Bennett, Bricklin & Saltzburg for bringing this case to my attention.

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