Young v. Insurance Department

604 A.2d 1105, 145 Pa. Commw. 587, 1992 Pa. Commw. LEXIS 154
CourtCommonwealth Court of Pennsylvania
DecidedFebruary 20, 1992
DocketNos. 376, 722 and 740 C.D. 1991
StatusPublished
Cited by6 cases

This text of 604 A.2d 1105 (Young v. Insurance Department) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Young v. Insurance Department, 604 A.2d 1105, 145 Pa. Commw. 587, 1992 Pa. Commw. LEXIS 154 (Pa. Ct. App. 1992).

Opinion

SILVESTRI, Senior Judge.

This consolidated appeal involves three Petitioners, Patricia R. Young, Kevin Bumberger and Michael Smearman, who collectively1 petition for review of an adjudication and order2 of the Insurance Commissioner which affirmed the Catastrophic Loss Benefits Continuation Fund’s (CAT Fund)3 denial of benefits to Petitioners.

After Petitioners’ request for benefits was denied by Pennsylvania Insurance Management Company (PIMCO), administrator for the CAT Fund, a request for review of the decision was submitted to the Pennsylvania Insurance Department’s Bureau of Consumer Services (Bureau). The Bureau affirmed PIMCO’s denial of benefits. Petitioners then submitted a request for a formal administrative hear[590]*590ing. Petitioners subsequently agreed to enter a Stipulation of Fact in each case in lieu of the formal administrative hearing. After briefs were submitted, the Insurance Commissioner affirmed the denial of CAT Fund benefits to Petitioners:

Common facts of all three Petitioners are as follows. All reside in Pennsylvania. All were involved in accidents occurring on or after June 1, 1989. Each incurred medical expenses in excess of $100,000. None were motor vehicle owners at the time of the accidents but all three resided with either a parent or grandparent who owned a motor vehicle for which the CAT Fund fee had been paid for the registration year during which Petitioners were involved in accidents.

Because disposition of the issues before us requires consideration of extant and repealed statutes, a brief history of the involved legislation is required. On October 1, 1984, contemporaneous with the repeal of the Pennsylvania No-fault Motor Vehicle Insurance Act,4 the Motor Vehicle Financial Responsibility Law (Motor Vehicle Law)5 became effective. The Motor Vehicle Law established the CAT Fund to compensate victims suffering a catastrophic loss resulting in medical expenses exceeding $100,000. The CAT Fund was funded by levying a charge on owners of motor vehicles required to be registered in Pennsylvania. To be eligible to receive CAT Fund benefits, a claimant had to be a resident of Pennsylvania whose injury arose out of the maintenance or use of a motor vehicle. Owners of motor vehicles who failed to comply with registration requirements, including non-payment of the CAT Fund fee, were ineligible for benefits.6 The CAT Fund was terminated on December 12, 1988.

[591]*591Thereafter, on April 26, 1989, the Legislature enacted an act (hereinafter “Act 4”) which provided for a new type of optional catastrophic loss coverage known as extraordinary medical benefit (EMB) coverage, to replace CAT Fund coverage. Act 4 also provided for .transition between termination of CAT Fund coverage on December 12, 1988 and commencement of the new EMB coverage on June 1, 1989. The so-called savings provision, 75 Pa.C.S. § 1798.2(a), enacted by the Legislature, provides as follows:

§ 1798.2. Transition
(a) Savings provision. — Notwithstanding the repeal of Subchapter F (relating to Catastrophic Loss Trust Fund) by the Act of December 12, 1988 ... all natural persons who suffer or suffered a catastrophic loss prior to June 1, 1989, or who may suffer a catastrophic loss during the registration year for which payment was made in accordance with former section 1762 (relating to funding), respectively, shall continue to receive, or be eligible to receive, catastrophic loss benefits as if Subchapter F had not been repealed____ (Citation omitted.)

This section was retroactive to December 12, 1988 and was intended to recognize there would be motor vehicle owners who paid a CAT Fund fee for a registration year which extended beyond June 1, 1989.

It is the interpretation of the savings provision regarding catastrophic losses after June 1, 1989 that is the issue presently before us for consideration. Petitioners contend the Insurance Commissioner has misconstrued the applicable law in reaching the conclusion that only owners of motor vehicles who paid CAT Fund fees and the registration fee for the year expiring subsequent to June 1, 1989, and not the public at large, are eligible for catastrophic loss benefits. Petitioners now request this Court to reverse the determination of the Insurance Commissioner.

Petitioners argue that, as a matter of interpretation, anyone who is a resident of the household and a relative of the owner of a motor vehicle who paid the CAT Fund fee is [592]*592eligible for benefits subsequent to June 1, 1989.7 Petitioners maintain that the savings provision did not purport, nor did the legislature intend, to limit benefits only to owners of motor vehicles thereby excluding the general category of coverage for Pennsylvania residents, as found by the Insurance Commissioner. Petitioners insist that the Motor Vehicle Law did not limit eligibility to cases where the motor vehicle involved in the accident was registered in Pennsylvania. Since no such change was mandated by Act 4, Petitioners contend that the Insurance Department’s interpretation, adopted by the Insurance Commissioner, is an invalid limitation and is beyond the authority of the Insurance Commissioner.

Upon review and due consideration of the position of the parties and statutory provisions, we are of the opinion that acceptance of Petitioners’ position that all household members or relatives of any motor vehicle owner who paid the CAT Fund fee are entitled to benefits for accidents occurring subsequent to June 1, 1989, would be illogical and would ignore legislative intent of limiting eligibility and transferring coverage to optional programs with private insurers.

We reach this conclusion after interpretation of the savings provision as aided by the Statutory Construction Act of 1972,1 Pa.C.S. § 1921. Under Section 1921(a) of the Statutory Construction Act, the object of an interpretation of a statute is to ascertain and effectuate the intention of the General Assembly and to give effect to all of the provisions contained therein. When the statute does not readily express that intent, we may ascertain the intention of the General Assembly by considering:

(1) The occasion and necessity for the statute.
(2) The circumstances under which it was enacted.
(3) The mischief to be remedied.
(4) The object to be attained.
[593]*593(5) The former law, if any, including other statutes upon the same or similar subjects.
(6) The consequences of a particular interpretation.
(7) The contemporaneous legislative history.
(8) Legislative and administrative interpretations of such statute.
1 Pa.C.S. § 1921(c).

In reaching our conclusion, we reviewed the legislative policy reasons8 underlying enactment of the savings provision as was done by the Supreme Court in Commonwealth v. DePasquale, 509 Pa. 183, 501 A.2d 626 (1985).

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Bluebook (online)
604 A.2d 1105, 145 Pa. Commw. 587, 1992 Pa. Commw. LEXIS 154, Counsel Stack Legal Research, https://law.counselstack.com/opinion/young-v-insurance-department-pacommwct-1992.