Maleski v. Mutual Fire, Marine & Inland Insurance

633 A.2d 1143, 534 Pa. 575, 1993 Pa. LEXIS 271
CourtSupreme Court of Pennsylvania
DecidedNovember 10, 1993
Docket89 M.D. Appeal Docket 1991
StatusPublished
Cited by24 cases

This text of 633 A.2d 1143 (Maleski v. Mutual Fire, Marine & Inland Insurance) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Maleski v. Mutual Fire, Marine & Inland Insurance, 633 A.2d 1143, 534 Pa. 575, 1993 Pa. LEXIS 271 (Pa. 1993).

Opinion

OPINION

NIX, Chief Justice.

Appellant, Cynthia M. Maleski, Insurance Commissioner of the Commonwealth of Pennsylvania, as Rehabilitator of the Mutual Fire, Marine and Inland Insurance Company (“Rehabilitator”), appeals from the Order of the Commonwealth Court dated September 18, 1991, granting Appellees’, Republic Insurance Company and Republic Insurance Group, petition to compel arbitration; denying the Rehabilitator’s petition for court resolution of this action; dismissing Appellees’ preliminary objections and the Rehabilitator’s complaint; and relinquishing jurisdiction. The Rehabilitator raises three issues for our review. First, whether the Commonwealth Court *577 erred by failing to hold a hearing on the Rehabilitator’s petition for Commonwealth Court resolution of this matter, in lieu of arbitration, as authorized by the Court-approved Plan of Rehabilitation. Second, whether the Commonwealth Court erred by failing to set forth findings of fact supporting its ultimate conclusion. Finally, whether the Commonwealth Court erred by dismissing the Rehabilitator’s complaint and relinquishing jurisdiction rather than staying court action pending arbitration and retaining jurisdiction and supervision over arbitration. Because the Commonwealth Court should have stayed court action pending arbitration, we quash the appeal.

The Rehabilitator filed a complaint in the Commonwealth Court alleging that the Mutual Fire, Marine and Inland Insurance Company (“Mutual Fire”) entered into a series of reinsurance agreements with Appellees that Appellees refused to honor. More specifically, the Rehabilitator averred that Appellees breached the reinsurance agreements by refusing to pay due and owing obligations. Appellees filed a preliminary objection to the complaint in the nature of: (a) a demurrer, based on a claimed right to arbitration and (b) a motion to strike, or, in the alternative, for a more specific pleading of ten of the forty-two counts in the complaint.

Subsequently, Appellees filed a petition to stay action and to compel arbitration. The Rehabilitator filed an answer with new matter in response to the petition to compel arbitration. Appellees filed a reply to the Rehabilitator’s new matter.

The Rehabilitator also filed a preliminary objection to Appellees’ preliminary objection in the nature of a demurrer on the basis that, under Pennsylvania law, Appellees’ demurrer was procedurally inappropriate. Additionally, the Rehabilitator responded to all of the Appellees’ preliminary objections.

Pursuant to a stipulation by the parties, argument of the petition to compel arbitration was consolidated with argument of the preliminary objections. Record at 923a-24a and 1098a. Less than one week before oral argument, the Rehabilitator filed a petition for Commonwealth Court resolution of this action, in lieu of arbitration, under the Court-approved Plan of *578 Rehabilitation for Mutual Fire. 1 The Rehabilitator filed the petition in response to Commonwealth Court decisions that addressed complaints for breach of contract and Section X petitions requesting Court resolution in lieu of arbitration. See Foster v. Philadelphia Mfrs., 140 Pa.Commw. 186, 592 A.2d 131 (1991). See also Foster v. Home Ins. Co., 140 Pa.Commw. 184, 592 A.2d 130 (1991). 2 Argument of this petition was consolidated without objection by the Rehabilitator, with the other matters scheduled for oral argument in the Commonwealth Court. Record at 1097a. On the day of oral argument, and five days after the petition for court resolution was filed, Appellees filed their response to the Rehabilitator’s petition.

The Commonwealth Court granted Appellees’ petition to compel arbitration of this action; denied the Rehabilitator’s petition for Court resolution of this action; dismissed Appellees’ preliminary objections and the Rehabilitator’s complaint; and relinquished jurisdiction.

The Rehabilitator filed a direct appeal to this Court. In her jurisdictional statement, the Rehabilitator stated that this Court has jurisdiction to hear this appeal pursuant to subsection 723(a) of the Judicial Code, 42 Pa.C.S. § 723(a) (Purdon Supp.1993) and Rule 1101(a)(1) of the Pennsylvania Rules of Appellate Procedure, which give this Court exclusive jurisdiction of appeals from final orders of the Commonwealth Court entered in any matter which was originally commenced in the *579 Commonwealth Court except an order entered in a matter which constitutes an appeal to the Commonwealth Court from another court. The Rehabilitator further submitted that, because the Commonwealth Court Order compelling arbitration of this action was entered pursuant to the Pennsylvania Arbitration Act, 42 Pa.C.S. §§ 7301-7362 (Purdon 1982 and Supp. 1993), this Court also has jurisdiction over this appeal pursuant to sections 7320(a)(6) and 7342 of the Pennsylvania Arbitration Act, 42 Pa.C.S. §§ 7320(a)(6), 7342 (Purdon 1982 and Supp.1993). Appellees did not file a brief in opposition to the jurisdictional statement.

On December 12,1991, this Court noted jurisdiction because the Commonwealth Court relinquished jurisdiction and, therefore, the Order appeared final. However, after further review, we find that the Commonwealth Court improperly relinquished jurisdiction and, as a result, that the appeal to this Court is from an interlocutory order. Therefore, we must quash the appeal.

Section 7304 of the Pennsylvania Arbitration Act, 42 Pa.C.S. § 7304, provides in pertinent part:

(d) Stay of judicial proceedings. — An action or proceeding, allegedly involving an issue subject to arbitration, shall be stayed if a court order to proceed with arbitration has been made or an application for such an order has been made under this section. If the issue allegedly subject to arbitration is severable, the stay of the court action or proceeding may be made with respect to the severable issue only. If the application for an order to proceed with arbitration is made in such action or proceeding and is granted, the court order to proceed with arbitration shall include a stay of the action or proceeding.

42 Pa.C.S. § 7304(d) (emphasis added). The Commonwealth Court granted Appellees’ petition to compel arbitration. Pursuant to subsection 7304(d), when the Commonwealth Court ordered arbitration, it was required to stay court action. Therefore, the Commonwealth Court erred when it failed to stay court action pending arbitration and relinquished its jurisdiction over the matter.

*580 Given the fact that the Commonwealth Court should have stayed court action pending arbitration, this Court does not have jurisdiction to determine the merits of this appeal. “Appeals can generally be taken only from orders which are final, rather than interlocutory, in nature.” Sweener v. First Baptist Church, 516 Pa.

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Bluebook (online)
633 A.2d 1143, 534 Pa. 575, 1993 Pa. LEXIS 271, Counsel Stack Legal Research, https://law.counselstack.com/opinion/maleski-v-mutual-fire-marine-inland-insurance-pa-1993.