Lancaster County Court of Common Pleas Applies Gallagher v. GEICO Retroactively

In the Court of Common Pleas of Lancaster County case of Rutt v. Donegal, No. CI-19-02544 (C.P. Lanc. Co. Sept. 16, 2019 Brown, J.), the court addressed the application of the Pennsylvania Supreme Court’s decision in Gallagher v. GEICO, which addressed the validity of the Household Exclusion in automobile insurance policies. 

According to the Opinion, the Plaintiff was involved in a motor vehicle accident while riding on a motorcycle that was covered by a carrier other than Donegal.

The Plaintiff recovered damages from the liability policy possessed by the tortfeasor as well as under the policy that covered his own motorcycle.  The Plaintiff then turned to Donegal for additional UIM coverage under a Donegal policy that covered another vehicle in the Plaintiff’s household. 

Donegal denied the claim under its Household Exclusion contained in its policy.

The Plaintiff responded by filing suit.  Donegal filed Preliminary Objections in the nature of a demurrer, asserting that the Gallagher decision could not be applied retroactively to apply to this case. 

The court in Rutt ruled that the Gallagher decision applied retroactively and applied a rationale similar to that voiced by the Eastern District Court in its decision in Butta v. GEICO.  In so ruling, the Rutt court also read the Gallagher decision in an expansive fashion, rejecting the effort by Donegal to limit Gallagher to its facts involving separate policies that were issued by the same carrier.

Anyone wising to review this decision may click this LINK.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA law firm of Schmidt Kramer for bringing this case to my attention.