United National Insurance v. Gallagher

41 Pa. D. & C.3d 177, 1985 Pa. Dist. & Cnty. Dec. LEXIS 77
CourtPennsylvania Court of Common Pleas, Philadelphia County
DecidedJune 12, 1985
Docketno. 393
StatusPublished

This text of 41 Pa. D. & C.3d 177 (United National Insurance v. Gallagher) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Philadelphia County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United National Insurance v. Gallagher, 41 Pa. D. & C.3d 177, 1985 Pa. Dist. & Cnty. Dec. LEXIS 77 (Pa. Super. Ct. 1985).

Opinion

WRIGHT, J„

HISTORY OF CASE

This is an action brought under the Uniform Declaratory Judgments Act, Act of July 9, 1976, P.L. 586, 42 Pa.C.S. §7531 et seq. All parties have waived jury trial and submitted to a trial by this court.

Defendants Eileen Gallagher and Richard Gallagher, her husband, and G-7412 Enterprises, Inc., their solely owned corporation (hereinafter Gallagher), operated a liquor establishment or taproom trading as Monday’s Tavern.

Gallagher had negotiated the purchase of the tavern located at 7412 Frankford Avenue, Philadelphia, Pa., and a settlement was held in May of 1979 in the office of Barry Goldstein, the attorney for the purchasers. Present at the settlement was Irving Zager, an insurance broker, who sold to the purchasers a policy of “liability” insurance covering the premises effective November 8, 1979 to November 8, 1980 and issued by plaintiffs United National Insurance Company.

On March 8, 1980, William Jones, a minor, was allegedly served alcoholic beverages while in defendants’ bar. He was shortly thereafter involved in an automobile accident while riding in a vehicle operated by James Kimnash. He has sued defendants [179]*179alleging that he became a passenger in the vehicle solely because of his intoxicated condition.

In October of 1980 one Danny Hartnett, while drinking at Monday’s Tavern was allegedly involved in a shooting incident causing injuries to David Vogelhut, who sued defendants as of September term, 1982, no. 3796.

We have made the following

FINDINGS OF FACT

1. Plaintiff is the United National Insurance Company, a corporation engaged in the insurance business in the Commonwealth of Pennsylvania.

2. Defendants are Eileen and Richard Gallagher, and G-7412 Enterprises, Inc., t/a Monday’s Tavern, (hereinafter collectively referred to as Gallagher), and D.J.’s Távern, Inc., t/a D.J.’s Tavern, William Jones and James Kimnash. Eileen Gallagher was the main officer of G-7412 Enterprises, Inc., at all times relevant hereto.

3. In May of 1979, the Gallaghers attended a meeting with Barry Goldstein, Esq., and Irvin Zager at the offices of Barry Goldstein. The purposes of this meeting was to conclude the Gallaghers’ purchase of Monday’s Tavern.

4. Mr. Goldstein was an attorney retained by the Gallaghers to represent them in the purchase of Monday’s Tavern. Mr. Goldstein had asked Irvin Zager, an independent insurance broker, to come to the meeting to discuss the insurance requirements of the business.

5. At the May, 1979 meeting Mr. Zager recommended' and explained to the Gallaghers that they should carry fire insurance, burglary insurance, workmen’s compensation insurance, liquor liability insurance, and general liability insurance (specifi[180]*180cally owners, landlords and tenants liability insurance), in order to fully protect Monday’s Tavern.

6. At settlement, the Gallaghers’ chose to purchase only fire and general liability insurance for Monday’s Tavern.

7. The Gallaghers did not ask for, or purchase “complete coverage” at the time of the settlement.

8. Thereafter the Gallaghers purchased workmen’s compensation insurance in October of 1979 and burglary insurance in November, 1979.

9. Prior to March 8, 1980, Mr. Zager suggested to the Gallaghers that they purchase liquor liability insurance. The Gallaghers chose not to do so.

10. United National issued its general liability policy no. GA 73116, with effective dates of November 8, 1979 through November 8, 1980 (hereinafter the Policy) to the Gallaghers.

1. Oh a page entitled “Coverage for Designated Premises and Related Operations and Progress Other Than Structural Alterations, New Construction and Demolition,” and immediately below the coverage provisions, the policy contained a section entitled “Exclusions.” Exclusion (h) reads as follows:

“This insurance does not apply: . . . (h) to bodily injury or property damage for which the insured or his indemnitee may be held liable

“(1) as a person or organization engaged in the business of manufacturing, distributing, selling or serving alcoholic beverages or

“(2) if not so engaged, as an owner or lessor of premises used for such purposes, if such liability is imposed

“(1) by, or because of the violation of, any statute, ordinance or regulation pertaining to the sale, gift, distribution or use of any alcoholic beverage,

“(ii) by reason of the selling, serving or giving of any alcoholic beverage to a minor or to a person un[181]*181der the influence of alcohol or which causes or contributes to the intoxication of any person;

but part (ii) of this exclusion does not apply with respect to liability-of the insured or his indemnitee as an owner or lessor described in (2) above; ...”

12. William Jones claims that on March 8, 1980, he was injured in an auto accident when he was a passenger in a car driven by James Kimnash.

13. On October 6, 1980, David Vogelhut was shot while in or near Monday’s Tavern. Notice of. the shooting was given to United National prior to January 5, 1981.

14. On or about January 5, 1981, a representative of United National came to Monday’s Tavern to investigate the shooting involving David Vogelhut.

15. On January 5, 1981, Eileen Gallagher signed a non waiver agreement whereby it was agreed that United National Insurance Company would investigate and, if necessary, defend any legal action against the Gallaghers stemming from the October 6, 1980 shooting of David Vogelhut. The non waiver agreement provided that any such action by United National would not constitute a waiver of any provision, term, condition, limitation or other portion of the insurance policy under which United National was acting. The non waiver agreement further provided that the Gallaghers were advised that grounds for disclaimer of coverage might exist, and investigation or defense by the company would not create a ground for any claim that United National had waived or forfeited its right to disclaim coverage or would be estopped from disclaiming coverage.

16. The non waiver agreement was executed by a representative of United National and by Eileen Gallagher in her dual capacity as president of G-7412 and individually. She was not subject to any duress by the plaintiff.

[182]*18217. At no time from May of 1979 through the present has United National ever represented to the Gallaghers that the policy provided coverage for any claim which would have otherwise been excluded by exclusion (h) of the policy.

18. On April 14, 1981, William Jones filed a complaint in trespass in the Court of Common Pleas of Philadelphia County, at April term, 1981, no. 1778 (hereinafter the underlying action), naming as defendants James Kimnash, D.J.’s Tavern, Inc., t/a D.J.’s Tavern and'G-7412 Enterprises, Inc., t/a Monday’s Tavern.

19. The complaint in the underlying action al.leged violations of the Pennsylvania Liquor Code and negligence in serving intoxicating beverages to a visibly intoxicated person and to a minor. The relevant paragraphs of the complaint state:

“5.

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Bluebook (online)
41 Pa. D. & C.3d 177, 1985 Pa. Dist. & Cnty. Dec. LEXIS 77, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-national-insurance-v-gallagher-pactcomplphilad-1985.