Monday, June 27, 2022

"Innocent Plaintiff" Fair Share Act Argument Gains Steam (Via More Dicta)


In the case of Anderson v. Motorists Mut. Ins. Co., No. 2:21-CV-00493-CCW (W.D. Pa. June 22, 2022 Wiegand, J.), the court addressed the issue raised by the parties as to the amount of the credit to which the UIM carrier was entitled in this particular claim.  As part of the analysis the Court addressed novel arguments raised under the Fair Share Act.

According to the Opinion, this case arose out of a fatal motor vehicle accident. 

After the accident, the Plaintiffs sued the third party tortfeasor and settled those claims. The Plaintiffs then filed a claim for UIM benefits with Motorists Mutual.

Motorists Mutual denied the claim on the basis that the value of the claim did not exceed the combined $5.1 million liability limits of the various third party tortfeasors.

With regards to the coverages at issue in the third party liability side, the Plaintiff was a passenger in a vehicle in which the operator of that vehicle was covered under a liability policy providing $100,000.00 in liability coverage.

The other vehicle involved in the accident was owned by a trucking Defendant who had liability limits of $1 million dollars as well as an umbrella policy with an additional $4 million dollars in coverage.

The Plaintiff settled the third party claim securing the $100,000.00 policy limit that covered the vehicle in which the Plaintiff is located at the time of the incident. The Plaintiff also settled against the trucking company for $55,000.00. Motorist Mutual consented to those settlements.

The court noted that, under the Motorist Mutual UIM endorsement, it was provided that the carrier would pay UIM benefits if “[t]he limits of liability under any applicable bodily injury liability bonds or policies have been exhausted by payment of judgements or settlements….”

In this matter, Motorists Mutual contended that it should receive a credit of $5.1 million dollars, which was the sum of all of the liability limits at issue (excepting a City of Pittsburgh policy limit, which was handled by the parties and the Court separately).

The Plaintiff was seeking a partial summary judgment under an argument that, unless Motorists Mutual could prove that the trucking Defendants’ percentage of fault equaled or exceeded 60%, Motorists Mutual should only be entitled to a credit equaled only to the amount the Plaintiff was legally entitled to recover from the joint tortfeasors, that is, $650,000.00, which was the sum of the amounts actually paid in settlement on the third party side by the operator of the vehicle in which the Plaintiff is located and the trucking Defendants. 

More specifically, the Plaintiff was contending that the UIM carrier must prove that the trucking Defendants’ liability equaled or exceeded 60% in order for the UIM carrier to claim the full credit of $5 million dollars under that third party Defendants’ policies. The Plaintiff went on to argue that, if the UIM carrier was unable to establish this proof, then the UIM carrier should only be entitled to a credit of the amount paid pursuant to the settlements because the Plaintiff would have been unable to recover the full amount of damages from the trucking Defendants under the Pennsylvania Fair Share Act.

The court applied Pennsylvania law and noted that there was no controlling Pennsylvania Supreme Court precedent on the issue of the enforcement of exhausting clauses concerning UIM benefits. However, it was noted that the Pennsylvania Superior Court had decided a number of cases in this regard, including the case of Boyle v. Erie in which the Superior Court held that a UIM carrier was entitled to the full amount of any liability limits that were available on the third party side.

The Plaintiff attempted to assert that the Boyle decision was in applicable, in part, due to the underlying policy concerns and Boyle being no longer applicable due to the passage of the Pennsylvania Fair Share Act.

The court in this matter held that it did not need to decide whether the Pennsylvania Fair Share Act altered Boyle’s holding.

The court more specifically stated that, even assuming that the enactment of the Pennsylvania Fair Share Act altered Boyle’s holding, the Plaintiff’s argument was still noted to fail because “it is not clear that the Pennsylvania Fair Share Act applies where the Plaintiff’s negligence is not in question, as is the case here.” See Op. at 13. 

In this regard, the court in this matter pointed to the case of Spencer v. Johnson, 249 A.3d 529 (Pa. Super. 2021). The court in this Anderson case stated that, in the Spencer case, the Pennsylvania Superior Court found, “as an alternative holding,” that for the “Fair Share Act to apply, the Plaintiff’s negligence must be an issue in the case.” See Op. at p. 13, citing Spencer at 559.

The court additionally pointed to another Pennsylvania Superior case on that similar issue and citing to the Spencer case. See Snyder v. Hunt, No. 851 EDA 2020, 2021 Pa. Super. Unpub. LEXIS 2993, at *14-15 (Pa. Super. Nov. 10, 2021).

The court in this Anderson case predicted that “because the decedent’s negligence is not at issue in this case, the Pennsylvania Supreme Court would find that the Fair Share Act does not apply in cases such as this one, where the Plaintiff’s negligence is not an issue, and, as a result, that the traditional principles of joint and several liability would control."  See Anderson Op. at 14.

Under this analysis, the court in Anderson held that it did not need to decide whether the Fair Share Act altered Boyle’s holding. 

The court went on to find that the language of the exhaustion clause in this case compelled the court to rule that the UIM carrier was indeed entitled to a credit for the full amount of the liability limits available in the underlying third party case (excepting those liability limits possessed by the City of Pittsburgh).

Anyone wishing to review a copy of this decision may click this LINK.


I send thanks to Attorney Joseph Hudock of the Pittsburgh law firm of Summers McDonald Hudock Guthrie & Rauch, P.C. for bringing this case to my attention.

Source of image:  Photo by Ekaterina Bolovtsova on www.pexels.com.

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