An appellate court in Pennsylvania has ruled that the Pennsylvania Supreme Court's Gallagher decision did not benefit an insured who sought underinsured motorist ("UIM") benefits where he had not preserved any claim that the so-called household exclusion in his automobile insurance policy was unenforceable.
The Case
Donald C. Petra asserted that he was involved in an accident with an automobile while he was operating his motorcycle. Mr. Petra said that he was ejected from the seat of his motorcycle and hit the ground, and that he suffered injuries in the accident both while he was on his motorcycle and after he flew off it.
Mr. Petra had previously waived UIM coverage under the insurance policy he had purchased from Progressive Advanced Insurance Company for his motorcycle, but he sought UIM coverage under a separate policy for his minivan that he had acquired from Pennsylvania National Mutual Casualty Insurance Company.
Penn Mutual denied coverage, citing its policy's "household exclusion," which excluded UIM coverage for injuries sustained while occupying, or being struck by, any vehicle not insured under its policy.
Mr. Petra sued, arguing that the household exclusion did not bar him from UIM coverage "because he was not occupying or struck by a vehicle when he suffered injuries from hitting the pavement." He did not argue that the household exclusion violated any provision of Pennsylvania's Motor Vehicle Financial Responsibility Law ("MVFRL").
For its part, Penn National maintained that the language of the household exclusion barred coverage.
The trial court granted summary judgment in favor of Penn National, and Mr. Petra appealed.
He again argued that the household exclusion, by its terms, did not preclude coverage under the facts of this case because he was not occupying or struck by a vehicle when he sustained the injuries for which he sought coverage. Mr. Petra, however, did not argue that the household exclusion violated any provision of the MVFRL.
The appellate court affirmed.
One week later, the Supreme Court of Pennsylvania decided Gallagher v. GEICO Indemnity Co., 201 A.3d 131 (Pa. 2019), holding that the household exclusion was unenforceable.
Following the Supreme Court's decision in Gallagher, Mr. Petra petitioned the Pennsylvania Supreme Court for allowance of appeal. The court granted the petition, vacated the appellate court's decision, and remanded the case for reconsideration in light of Gallagher.
The Appellate Court's Decision
The appellate court affirmed its prior order, ruling that Gallagher did "not affect" its decision in this case.
In its decision, the appellate court explained that because Mr. Petra did not preserve any claim that the household exclusion violated the MVFRL, the issue was "waived."
The appellate court reasoned that Mr. Petra's argument all along was that the household exclusion did not apply in this case because he had sustained his injuries after he hit the pavement and, therefore, was not "occupying" his motorcycle when he was injured.
The appellate court pointed out that Mr. Petra "at no time argued in the trial court or in this [c]ourt that the household exclusion violated" the MVFRL.
Accordingly, it reaffirmed its rejection of the arguments that Mr. Petra did preserve for the reasons it previously set forth in this case.
The case is Petra v. Pennsylvania National Mutual Casualty Ins. Co., No. 505 MDA 2018 (Penn. Super. Ct. Oct. 31, 2019).
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Steven A. Meyerowitz
Steven A. Meyerowitz, a Harvard Law School graduate, is the founder and president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. He may be contacted at [email protected].