Dodson v. Nationwide Insurance

9 Pa. D. & C.4th 495, 1991 Pa. Dist. & Cnty. Dec. LEXIS 387
CourtPennsylvania Court of Common Pleas, Blair County
DecidedJanuary 29, 1991
Docketno. 951 of 1988
StatusPublished

This text of 9 Pa. D. & C.4th 495 (Dodson v. Nationwide Insurance) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Blair County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dodson v. Nationwide Insurance, 9 Pa. D. & C.4th 495, 1991 Pa. Dist. & Cnty. Dec. LEXIS 387 (Pa. Super. Ct. 1991).

Opinion

KOPRIVA, J.,

Now before this court is a motion for summary judgment. Defendant sets forth two alternative arguments in support of its position that plaintiffs are barred from [496]*496maintaining this action. Firstly, defendant asserts plaintiffs’ no-fault action is barred by a general release which plaintiffs executed on October 29, 1987. Secondly, defendant contends this action is time-barred under the provisions of 40 P.S. §1009.106(c)(1). We will address the arguments se-riatim.

Plaintiff Susan E. Dodson was injured in a one-vehicle accident which occurred on August 22,1984. Plaintiff had been a passenger in a vehicle driven by Christine Dodson. Plaintiffs filed a negligence action against Christine Dodson. Nationwide insured Christine Dodson and paid the policy limit of $25,000 to plaintiffs in settlement of the third-party claim. In conjunction with the settlement, plaintiffs executed a release in favor of Christine Dodson and Nationwide on October 28, 1987. Said release reads as follows:

“For the sole consideration of $25,000, the receipt and sufficiency where is hereby acknowledged, the undersigned hereby releases and forever discharges Christine Dodson and Nationwide Insurance Company, their successors and assigns, and all other persons, firms or corporations liable or who might be claimed to be liable, none of whom admit any liability to the undersigned, but all expressly deny any liability, from any kind or nature whatsoever, and particularly on account of all injuries, known and unknown, both to person and property, which have resulted or may in the future develop from an accident which occurred on or about the second day of August, 1984, at the intersection of Business Route 220, and U.S. Route 220 in Greenfield Township, Blair County, Pennsylvania.
“Undersigned hereby accepts the draft as final payment of the consideration set forth above.”

[497]*497Thereafter, plaintiffs filed a complaint against Nationwide to collect first-party no-fault benefits. Coincidentally, Nationwide insured both the third-party tort-feasor and plaintiffs. Therefore, defendant claims the above-stated release serves to discharge Nationwide’s obligation to plaintiffs under their first-party no-fault policy in addition to settling the third-party claim.

Generally, written releases are construed according to the rules governing the construction of contracts. Sparler v. Fireman’s Insurance Company, 360 Pa. Super. 597, 521 A.2d 433 (1987). The intent of the parties to the release is paramount, and in construing a release, a court should adopt an interpretation which “ascribes the most reasonable, probable and natural conduct of the parties.” Sparler, supra, citing General Mills Inc. v. Snavely, 203 Pa. Super. 162, 168, 199 A.2d 540, 543 (1964). A signed release is binding upon the parties unless executed and procured by fraud, duress, accident or mutual mistake. Applebaum v. State Farm Mutual Automobile Insurance Company, 626 F.Supp. 1299 (M.D. Pa. 1986).

At first blush the language of the release seems to indicate Nationwide is completely released from “any and all claims, demands, damages, actions, causes of action or suits of any kind” with regard to the accident involving plaintiffs of August 2, 1984. Therefore, on the face of the release, it would seem the within claim for no-fault benefits would be included in such broad language. However, in considering the circumstances surrounding the execution of the release, the question of whether it serves to bar this action is far from clear. In consideration for said release defendant paid to plaintiffs for their third-party claim the sum of $25,000. That amount is equal to the policy limit of defendant’s insurance [498]*498contract concerning Christine Dodson. The release is totally silent regarding no-fault benefits. Had the discharge of defendant’s no-fault obligation been intended by the parties, it is reasonable to expect that the release would have so stated.

The most persuasive factor in support of the argument that the parties never intended the release to discharge the no-fault obligation is failure to comply with 40 P.S. §1009.106(b)(1). This statute sets forth the provisions that must be followed in order to effectuate a valid release of a no-fault contractual obligation. Plaintiff argues that this statute is not applicable to the situation at bar, as the sections applies only to claims for no-fault benefits, and therefore would not affect a general release which perhaps “inadvertently” included no-fault carriers by its broad language. Further, since the release at issue involved a third-party tort action and not a no-fault claim, the provisions of section 106(b)(1) are not applicable. This court finds no merit to counsel’s argument.

Subsection 106(b)(1) of the No-fault Act applies to any settlement or release purporting to discharge no-fault obligations. The obvious purpose for this section is to protect claimants by requiring judicial determination to insure that any settlement discharging an insurer from no-fault payments be in the best interest of the claimant and give the insurance company no advantage. The legislature made it more difficult for insurers to release themselves from no-fault responsibility than it is to release themselves from liability for payment of tort claims. Despite this obvious and sound reasoning, defendant would have us find that where no-fault benefits are allegedly discharged through settlement of a tort claim rather than a no-fault claim, somehow the judicial safeguards of section 106(b)(1) are not ap[499]*499plicable. Such reasoning has no logical basis and we will not permit defendant to circumvent the clear legislative intent of section 106(b)(1).

There is no question in this court’s mind that the release of no-fault liability was not intended by either party when the release was signed on October 28, 1987. It would appear defendant is attempting to take advantage of the coincidence in this situation that it insures both tort-feasor and plaintiff. To interpret the release as discharging Nationwide’s first-party no-fault obligation to plaintiff without court approval under these circumstances, would defeat the purpose for which the act was created; to compensate accident victims for injuries suffered, with court review.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Applebaum v. State Farm Mutual Automobile Insurance
626 F. Supp. 1299 (M.D. Pennsylvania, 1986)
General Mills, Inc. v. Snavely
199 A.2d 540 (Superior Court of Pennsylvania, 1964)
Sparler v. Fireman's Insurance Co. of Newark
521 A.2d 433 (Supreme Court of Pennsylvania, 1987)
Jones v. Keystone Insurance
528 A.2d 177 (Supreme Court of Pennsylvania, 1987)

Cite This Page — Counsel Stack

Bluebook (online)
9 Pa. D. & C.4th 495, 1991 Pa. Dist. & Cnty. Dec. LEXIS 387, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dodson-v-nationwide-insurance-pactcomplblair-1991.