Epstein v. State Farm Mutual Insurance

459 A.2d 354, 312 Pa. Super. 542, 1983 Pa. Super. LEXIS 2842

• Court: Superior Court of Pennsylvania
• Decided: March 18, 1983
• Docket: 1179
• Status: Published

Opinions

SPAETH, Judge:

This is an appeal from an order dismissing appellant’s complaint with prejudice on the ground that the claim raised is the same as the one that has already been asserted in a prior action. Appellant argues that we should reverse the order because dismissal was not justified under the doctrines of res judicata or lis pendens. We affirm.

In July 1978, Michael Epstein, appellant, was injured in a motor vehicle accident. Appellant was insured by State Farm Mutual Insurance Company, appellee, under a policy that included uninsured motorist benefits. The driver, Terrell Moore, was insured by Concord Mutual Insurance Company.

In February 1980, appellant sought to obtain uninsured motorist benefits from appellee. The claim was arbitrated and coverage was denied. Exceptions were denied on the grounds that appellant had not established his entitlement to uninsured motorist’s benefits, and that in any event, his exceptions had not been timely filed. The order denying appellant’s exceptions was appealed to this court on January 8, 1981. That appeal has not yet been decided.

On March 2, 1981, appellant filed a complaint against appellee seeking general and punitive damages for appellee’s refusal to provide appellant with uninsured motorist coverage for the July 1978 accident. The complaint was dismissed on the ground that it raised the same claim as had already been asserted in the prior action. This appeal is from that dismissal.

Appellant’s argument that this action—the second action—should not have been dismissed lacks merit. Both the cause of action in this case and the cause of action in the prior case arise from the same occurrence—appellee’s refusal to provide uninsured motorist benefits to compensate appellant for injuries suffered in the July accident. Because both causes of action arise from the same occurrence, appellant was required by the compulsory joinder provisions of the Rules of Civil Procedure to assert them both in a single action. Thus, Rule 1020 provides: “(d)(1) If a transaction or occurrence or a series of transactions or occurrences gives rise to causes of action in assumpsit and trespass against the same person, ... they shall be joined in an action against any such person in separate counts.” Pa.R.Civ.P. 1020(d)(1) (emphasis added). Appellant’s failure to abide by this rule—in other words, his failure in his first action to join as a separate count the cause of action he now argues before us—“shall be deemed a waiver of that cause of action as against all parties to the action.” Pa.R.Civ.P. 1020(d)(4).¹ The lower court’s order dismissing that action was therefore proper.²

Affirmed.

CIRILLO, J., files a dissenting opinion.

1 . The dissent argues that Pa.R.Civ.P. 1020(d)(1) does not apply because appellee, rather than appellant, petitioned for the appointment of an arbitrator in the first action. Dissenting op. at 356. But the fact that appellee petitioned for the appointment of an arbitrator does not undermine the fact that it was appellant’s claim for insurance proceeds that was the subject of the arbitration. Appellee had no reason to petition the court for the appointment of an arbitrator except to facilitate the resolution of appellant’s claim. Thus the lower court found that “[t]his case was the second claim filed by plaintiff. The first claim was heard by an arbitrator appointed by the Court under the Pennsylvania Arbitration Act of 1927.” Slip op. at 1. The lower court’s denial of appellant’s exceptions to the arbitrator’s award in the first action was based on the fact that appellant "utterly failed to carry his burden of proof." Slip op. at 3. The lower court was thus entirely correct in concluding that the first claim, as well as the second, was brought by appellant.

The dissent also argues that we should not dispose of this appeal on the basis of Rule 1020 because the parties have not argued the rule. Dissenting op. at 356. Although neither the parties nor the lower court referred specifically to Rule 1020, the policy that the rule promotes—that appellant should not be permitted to waste judicial resources by presenting a dispute involving one transaction in two separate actions—was the basis of appellee’s objection to the second action both in the lower court and on appeal: "This lawsuit arises out

2 . See note 2 on page 545. of the same exact claim as was heard and considered by the arbitrator .... It is ... a duplicate cause of action to the arbitration already heard and decided and presently on appeal; it is wasteful of the Court’s time and is spurious." Defendant’s Preliminary Objections at 3. ”[T]he complaint ... fails to state a cause of action ... because the complaint indicated on its face that it alleged the same dispute dealt with in the arbitration proceeding.” Brief for Appellee at 8. The lower court dismissed appellant’s complaint in this action on the ground that “[t]his case was the second claim filed by plaintiff____ This second claim arises out of the same claim that was heard and denied by the arbitrator. The second claim is entirely spurious____” Slip op. at 1. It is precisely on that basis, with the additional authority of Pa.R.Civ.P. 1020(d), that we affirm the lower court’s order.

2. Even if the dissent were correct that the cause of action now asserted before us is distinct from that asserted by appellant in his first action, we should disagree with its suggested disposition of the case. The underlying issue in the first action is whether appellant is entitled to receive uninsured motorist benefits from appellee. The first action is now on appeal to this court. If on that appeal we uphold the lower court, either on the ground that appellant did not timely file exceptions or on the merits, the conclusion will follow that appellant is not entitled to uninsured motorist benefits. That conclusion will be binding on appellant in his second action—the action before us in this case. This will be true by virtue of the doctrine of .collateral estoppel. See generally Lebeau v. Lebeau, 258 Pa.Super. 519, 393 A.2d 480 (1978). Consequently, the action before us would then have to be dismissed. If, on the other hand, the lower court’s decision in the first action is reversed on appeal, the conclusion will follow that appellant is entitled to uninsured motorist benefits. That conclusion will be binding on appellee. Therefore, if the dissent were correct that appellant has not waived but may maintain his second action, the only issue that the lower court would need to decide in that action would be whether appellant was entitled to punitive damages. See generally, Lebeau v. Lebeau, supra. It follows that, on its view of the case, the dissent should not argue for reversal of the lower court’s order but for a stay, pending disposition of the appeal in the first action. Instead, the dissent recommends that not this action but the first action be stayed. Wc think, however, that “the interest of justice and judicial economy,” dissenting op. at 357, will be better served if we dispose of this action now.