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HomeMy WebLinkAbout00-5090 civilWALTER W. HAWBAKER & JENNIFER Iq. HAWBAKER Vo COMMONWEALTH OF : PENNSYLVANIA, DEPARTMENT: OF TRANSPORTATION, : BUREAU OF MOTOR VEHICLES : NO. 2000-5090 CIVIL TERM · IN THE COURT OF COMMON PLEAS OF · CUMBERLAND COUNTY, PENNSYLVANIA · o I-N RE: OPINION PURSUANT TO PA. R.A.P. 1925 Guido, J., February 13, 2001. The Commonwealth of Pennsylvania Department of Transportation has appealed our Order of December 5, 2000, sustaining the appeal of Walter and Jennifer Hawbaker (the Hawbakers) from the suspension of the registration privilege in connection with their family vehicle. The reasons for our order are set forth in the opinion that follows. FACTUAL BACKGROUND The Hawbaker's received notice fi'om Progressive Insurance that the coverage on their van would be cancelled unless their premium was paid by April 13, 2000. Mrs. Hawbaker mailed a money order for the premium to Progressive prior to April 13, 2000. Apparently the payment arrived after the deadline. Rather than accept it, Progressive returned the premium payment to the Hawbakers and cancelled their coverage, effective April 13, 2000. Unfortunately, the notice of cancellation did not reach the Hawbakers on a timely basis. 2000-5090 CIVIL The Hawbaker's first notice of cancellation came in the form of a letter from Penn DOT which they received on May 10, 2000. The letter advised them that their insurance had been cancelled, effective April 13, 2000, and that their vehicle registration would be suspended if they did not purchase additional insurance by May 13, 2000. They immediately contacted Progressive. The insurer verified that their premium had been returned and that their insurance coverage would not be reinstated. Despite their best efforts, they could not make arrangements to secure insurance xvith another company until May 19, 2000. Since their van had been uninsured for a period in excess of thirty (30) days, and since it was operated by the Hawbakers during the lapse in coverage, Penn DOT suspended their vehicle registration for three months pursuant to Section 1786(D) of the Vehicle Code.~ The suspension was to be effective July 28, 2000. The Hawbakers appealed the Department's action to this court and we stayed the registration suspension pending a hearing on the merits. The Hawbaker's also filed a complaint with the Insurance Department challenging the propriety of Progressive's action in cancelling their policy. The matter was still pending before the Insurance Department at the time of our hearing.2 The Hawbakers are a young, married couple xvith an infant child. They are struggling to make ends meet. The suspension of the registration on their only vehicle would result in a severe hardship to them and would, under the circumstances, be manifestly unfair. ~ 75 Pa. C.S.A. {} 1786(D). 2 Counsel for Penn DOT was aware of the matter pending before the Insurance Department prior to the commencement of the hearing on this appeal. 2000-5090 CIVIL DISCUSSION At the time of the hearing we found Mrs. Hawbaker to be both credible and sympathetic. We were satisfied that she and her husband had been caught up in a bearacutic nightmare involving their insurer, the Department of Transportation, and the Insurance Department. They had no intention of allowing their insurance to lapse. They did everything they thought necessary to keep it in force. After they discovered that it had, in fact, lapsed, they took immediate action to have it reinstated at the earliest possible date. Since their prior insurer would not agree to reinstate them, despite their best efforts, they could not obtain alternate coverage until May 19, 2000, nine days after they received notice that they had no insurance.3 However, that date was 36 days after their insurance had been cancelled. Therefore, Penn DOT felt that it had no alternative but to suspend the Hawbaker's registration on the vehicle in question pursuant to Section 1786(D) of the Vehicle Code. At the conclusion of the hearing, Penn DOT's laxvyer suggested, and we agreed, that the instant case was controlled by the Commonwealth Court's decisions in Stone v. Dept. of Transportation, Bureau of Driver Licensing, 166 Pa. Commonwealth. 643,647 A.2d 287 (1994), and O'Hara v. Department of Transportation, Bureau of Driver Licensing, 691 A.2d 1001 (Pa. Commonwealth 1997). As the Stone Court noted: While we too have sympathy for Stone's predicament, v,'e agree with Common Pleas that the Code is clear. The Department is required to suspend the operating privilege of the ov,-ner or registrant of a vehicle, when the Department determines that that person has operated the vehicle without insurance. There is no requirement that the Department establish that the person xvas at fault or that the person intended to operate the vehicle without insurance. Neither is the Department required to prove that the owner or registrant actually received notice of an imminent lapse of insurance. 3 Two of those days fell on a weekend. 2000-5090 CIVIL 647 A.2d at 288. The O'Hara Court quoted xvith approval the above language from Stone. It also held that a collateral attack upon the appropriateness of the insurance cancellation could not be made in the Court of Common Pleas. Quoting from Department of Transportation, Bureau of Driver Licensing v. Riley, 150 Pa. Commonwealth 259, 615 A.2d 905 (1992) the O'Hara Court stated: Sections 8, 9 and 10 of the Insurance Act, Act of June 5, 1968, P.L. 140, as amended, 40 P.S. §§ 1008.8, 1008.9, and 1008.10, provide a method by which an insured, who may have been illegally cancelled or refused renewal of an insurance policy, can obtain a review of the insurer's actions. This is the exchtsive re,~edy to challenge an alleged violation of the Commonwealth's insurance laws and a ~'ehic/e ma3' not collateral6' challenge such a caucellatio~ in the context appeal,fi'om an ope~'ation or registration privilege suspe~sion i,~posed by DOT. Rile):, 615 A.2d at 909. (emphasis added) 691 A.2d at 1003. The Court went on to state: where an insured believes that an insurer has improperly terminated insurance coverage, the insured has an exclusive remedy to challenge the cancellation under the Insurance Act. If the insured does ~ot challenge the tem~ination of insurance, the insured has waived that issue. However, if the insured makes the challenge and prevails against the insurer, DOT may not suspend the insured's vehicle registration. (emphasis added) 691 A.2d 1004. In the case at bar, the Hawbaker's had, in fact, challenged the cancellation of their insurance with the Insurance Department. Those proceedings were still pending at the time of the hearing before us. Since the O'Hara Court made it very clear that the Department may not suspend the insureds' registration if they prevail in their challenge 2000-5090 CIVIL before the Insurance Department, we held that the Department's action was premature. Therefore, xve sustained the appeal.4 FEBRUARY } $~, 2001 Edward E. Guido, J. Walter & Jennifer Hawbaker 20 West Springville Road Boiling Springs, Pa. 17007 George Kabusk, Esquire Riverside Office Center 1101 South Front Street Harrisburg, Pa. 17104 :sld 4 The Department now contends that we should have granted a continuance pending the outcome of the action before the Insurance Department. In retrospect, that may have been the better course of action. However, no request for continuance was made by the Department, even though it was aware that a favorable decision by the Insurance Department would preclude suspension of the Hawbakers' vehicle registration.