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HomeMy WebLinkAbout2011-1388 PMSLIC INSURANCE COMPANY, : IN THE COURT OF COMMON PLEAS Plaintiff : CUMBERLAND COUNTY, PENNSYLVANIA : : v. : : : ROBERT C. KNAPP, M.D., : No. 2011-1388 CIVIL Defendant, and : : TRACY COTTERS; ROBERT : LANEY and KRISTY PALITTI, : husband and wife; BOBBI ANN : CONNIFEY and MICHAEL : CONNIFEY, husband and wife; : REGINA WINTERS; MECHELLE : POLING and DAVID POLING, : husband and wife, : Nominal Defendants : IN RE: DEFENDANTS’ PRELIMINARY OBJECTIONS AND PETITION TO TRANSFER VENUE ORDER OF COURT th AND NOW , this 9 day of May, 2011, after consideration of Defendants’ Preliminary Objections and Defendant Knapp’s Petition to Transfer Venue, IT IS HEREBY ORDERED AND DIRECTED that the Defendants’ Preliminary OVERRULEDDENIED. Objections are and Defendant Knapp’s Petition to Transfer Venue is By the Court, M. L. Ebert, Jr., J. 1 Amanda R. Gerstnecker, Esquire Beth A. Slagle, Esquire Meyer, Unkovic & Scott, LLP 1300 Oliver Building Pittsburg, PA 15222 Attorneys for Defendant Knapp Charles F. Bowers III, Esquire Bowers Ross & Fawcett, LLC 820 Kennedy Drive P.O. Box 280 Ambridge, PA 15003 Attorney for Nominal Defendants Tracy Cotters, Kristy Palitti, Robert Laney, and Bobbi Ann Connifey Michael A. Murphy, Esquire Ogg, Murphy & Perkosky, LLP 245 Fort Pitt Boulevard Pittsburgh, PA 15222 Attorney for Nominal Defendant Regina Winters Mechelle and David Poling 230 Dogwood Circle Baden, Pennsylvania 15005 Nominal Defendants 2 PMSLIC INSURANCE COMPANY, : IN THE COURT OF COMMON PLEAS Plaintiff : CUMBERLAND COUNTY, PENNSYLVANIA : : v. : : : ROBERT C. KNAPP, M.D., : No. 2011-1388 CIVIL Defendant, and : : TRACY COTTERS; ROBERT : LANEY and KRISTY PALITTI, : husband and wife; BOBBI ANN : CONNIFEY and MICHAEL : CONNIFEY, husband and wife; : REGINA WINTERS; MECHELLE : POLING and DAVID POLING, : husband and wife, : Nominal Defendants : IN RE: DEFENDANTS’ PRELIMINARY OBJECTIONS AND PETITION TO TRANSFER VENUE OPINION AND ORDER OF COURT Ebert, Jr., May 9, 2011 - Background Plaintiff is PMSLIC Insurance Company (“PMSLIC”), a Pennsylvania medical professional liability insurance company with its principle place of business at 1700 Bent Creek 1 Boulevard, Mechanicsburg, Cumberland County, Pennsylvania. Defendant Robert C. Knapp, M.D., resides at 104 Brian Drive, Beaver, Beaver County, Pennsylvania, and operates a medical 2 practice at 701 Sharon Road, Beaver, Beaver County, Pennsylvania. Nominal Defendants Tracey Cotters, Robert Laney and wife Kristy Palitti, Bobbi Ann Connifey and husband Michael 1 Complaint, filed Feb. 7, 2011, ¶ 1. 2 Complaint, ¶ 2. 3 Connifey, and Mechelle Poling and husband David Poling, are all residents of Beaver County, 34 Pennsylvania. Nominal Defendant Regina Winters is a resident of East Liverpool, Ohio. Defendant Knapp is insured by Plaintiff and complaints have been filed against him in Beaver County by Nominal Defendants alleging intentional and negligent conduct and inappropriate contact that was not for the purposes of medical treatment or diagnosis. Defendant 5 Knapp’s insurance policy issued by Plaintiff contains certain exclusions to coverage. On February 7, 2011, Plaintiff filed a Complaint for Declaratory Judgment in Cumberland County for relief from defense and liability of Defendant based on the nature of the complaints against him brought by Nominal Defendants. Because Defendant’s insurance policy was formed in and issued from Cumberland County, Plaintiff filed its Action for Declaratory Judgment in Cumberland County. Defendant Knapp and Nominal Defendants Cotters, Laney and Palitti, the Connifeys, and Winters filed Preliminary Objections for improper venue. Defendant Knapp also filed a Petition for Change of Venue. For the reasons discussed below, we overrule Defendants’ Preliminary Objections and deny Defendant Knapp’s Petition for Change of Venue. Discussion A. Venue is proper in Cumberland County. Venue is proper in Cumberland County because the insurance policy to be interpreted is a contract that was formed in Cumberland County. Formation of a contract is a transaction or occurrence sufficient to establish venue in this case. An action against an individual may 3 Complaint, ¶ 3, 4, 5, 7. 4 Complaint, ¶ 6. 5 Complaint, ¶ 17. 4 properly be brought in and only in a county in which: (1) the individual may be served or in which the cause of action arose or where a transaction or occurrence took place out of which the cause of action arose or in any other county authorized by law, . . . . Pa. R.C.P. 1006 (a)(1). (emphasis added). In the case of multiple defendants, 2) If the action to enforce a joint or joint and several liability against two or more defendants includes one or more medical professional liability claims, the action shall be brought in any county in which the venue may be laid against any defendant under subdivision (a.1). Pa.R.C.P. 1006 (c)(2). Defendant Knapp claims in part that venue is improper because he completed the insurance application in Beaver County, signed the policy and received bills in Beaver County, 6 and mailed premium payments from Beaver County. Pennsylvania courts have made it clear that these actions do not constitute acceptance of a contract, and that venue is proper where acceptance takes place. The Pennsylvania Superior Court has held that the “making of a contract, which takes place where the offer is accepted, undoubtedly constitutes a ‘transaction or occurrence’ sufficient to establish venue.” Lucas Enterprises, Inc. v. Paul C. Harman Company, Inc., 417 A.2d 720, 721 (Pa. Super. 1980). An insurance policy is a contract, and the interpretation of a contract is a question of law. Wall Rose Mut. Ins. Co. v. Manross, 939 A.2d 958, 962 (Pa. Super. 2007). The Pennsylvania Supreme Court has held that an application for life insurance is an offer or proposal to contract, not a contract, and that even payment of a premium does not create a contract. Munhall v. Travelers’ Ins. Co., 150 A. 645, 648 (Pa. 1930). In Munhall, the plaintiff could not recover when her husband had completed an application for life insurance and paid premiums, but died before the policy was issued. The court stated 6 Defendant Knapp’s Preliminary Objections to Complaint, filed 3/31/11, ¶ 27-29. 5 As the application was but an offer, the company was free to accept or reject it. The mere execution of the policy is not an acceptance; an acceptance, to be complete, must be communicated to the offeror, either directly, or by some definitive act, such as placing the contract in the mail. Id. at 648. Like in Munhall, Defendant in the present case only made an offer when he completed the application for insurance. A contract was formed between the parties when Plaintiff accepted the offer by approving Defendant’s application and issuing and delivering his policy to him. 7 Plaintiff accepted Dr. Knapp’s application for insurance at its offices in Cumberland County. The Pennsylvania Commonwealth Court held that venue was proper in Dauphin County when a Beaver County debtor entered into a loan agreement with a Beaver County lender and a Dauphin County guarantor and the guarantor filed an assumpsit action in Dauphin County when the debtor defaulted on the loan. Pennsylvania Higher Education Assistance Agency v. Christon, 400 A.2d 1329 (Pa. Cmwlth. 1979). The Commonwealth Court used the Pennsylvania Supreme Court’s reasoning behind the rules for venue, stating that the purpose is to “permit a plaintiff to institute suit against the defendant in the county most convenient for him and his witnesses and to assure that the county selected had a substantial relationship to the controversy between the parties and was thereby a proper forum to adjudicate the dispute.” Id. at 1330 (quoting County Construction Co. V. Livengood Construction Corp., 142 A.2d 9, 13 (Pa. 1958)). The court found that Dauphin County and the controversy in that case had met the substantial relationship test and that it was clearly more convenient for appellee to institute suit in its home county. In the present case, venue is proper in Cumberland County because the contract was accepted and formed in Cumberland County. Furthermore, a substantial relationship with Cumberland County exists because Defendant Knapp submitted his claims governed by the 7 PMSLIC’s Response to Preliminary Objections of Regina Winters, filed Mar. 28, 2011, ¶ 7. 6 contract to Cumberland County, and, because PMSLIC’s only office is in Cumberland County, 8 insurance premiums were paid in Cumberland County. The underlying issue in the present action for declaratory judgment involves a request for interpretation of an insurance contract between PMSLIC and Knapp. It is well-settled that the interpretation of an insurance policy is a question of law for the court. Young by Young v. Equitable Life Assur. Soc. of U.S., 504 A.2d 339 (Pa. Super. 1986). Furthermore, the interpretation of an insurance policy is a matter properly resolved in a declaratory judgment action. Erie Ins. Exchange v. Muff, 851 A.2d 919, 925 (Pa. Super 2004) (citing Aetna Cas. and Sur. Co. v. Roe, 650 A.2d 94, 98 (Pa. Super. 1994). The Pennsylvania Superior Court has stated that: It is not the actual details of the injury, but the nature of the claim which determines whether the insurer is required to defend. The duty to defend is limited to only those claims covered by the policy. The insurer is obligated to defend if the factual allegations of the complaint on its face comprehend an injury which is actually or potentially within the scope of the policy. Thus, the insurer owes a duty to defend if the complaint against the insured alleges facts which would bring the claim within the policy’s coverage if they were true. It does not matter if in reality the facts are completely groundless, false, or fraudulent. It is the face of the complaint and not the truth of the facts alleged therein which determines whether there is a duty to defend. Tuscarora Wayne Mutual Insurance Company v. Kadlubosky, 889 A.2d 557, 561 (Pa. Super. 2005) (quoting Erie Ins. Exchange v. Muff, 851 A.2d at 926). Interpretation of the contract is a proper matter of law for this court to decide in a declaratory judgment action. The contract was accepted in, and policy issued from, Cumberland County. A substantial relationship exists between the controversy in this case because the policy at issue was formed in Cumberland County, premiums were paid in Cumberland County, and 8 In Lucas, the Pennsylvania Superior Court adopted the rule that “in the absence of agreement to the contrary, . . . payment is due at the plaintiff’s residence or place of business, and venue is proper there in a breach of contract action alleging failure to make payment.” Lucas, 417 A.2d at 721. 7 claims were submitted in Cumberland County. Accordingly, we find that venue is proper in Cumberland County for this declaratory judgment action. B. Venue should not be transferred to Beaver County. In reviewing Defendant’s Petition to Transfer Venue, we find that Defendant has not met the required burden to establish that venue should be transferred to Beaver County for consideration of this declaratory judgment action. It is well established that “the trial court is accorded ‘considerable discretion in determining whether or not to grant a petition for change of venue, and the standard of review is one of abuse of discretion.’” 84 Lumber Company, L.P. v. Fish Hatchery, L.P., 934 A.2d 116, 117 (Pa. Super. 2007). Pennsylvania courts have established that a plaintiff’s choice of venue should be given great deference. See Cheeseman v. Lethal Exterminator, Inc., 701 A.2d 156 (Pa. 1997). In Cheeseman, the Pennsylvania Supreme Court stated that a petition to transfer venue should not be granted unless the defendant meets its burden of demonstrating, with detailed information on the record, that the plaintiff's chosen forum is oppressive or vexatious to the defendant. Thus, . . . the defendant may meet its burden of showing that the plaintiff's choice of forum is vexatious to him by establishing with facts on the record that the plaintiff's choice of forum was designed to harass the defendant, even at some inconvenience to the plaintiff himself. Alternatively, the defendant may meet his burden by establishing on the record that trial in the chosen forum is oppressive to him; for instance, that trial in another county would provide easier access to witnesses or other sources of proof, or to the ability to conduct a view of premises involved in the dispute. But, we stress that the defendant must show more than that the chosen forum is merely inconvenient to him. Id. at 162. In Wilson v. Levine, 963 A.2d 479 (Pa. Super. 2008), the Pennsylvania Superior Court found that the trial court erred when it granted the appellees’ preliminary objections and transferred venue from Butler County to Montgomery County, even when most witnesses were located in Montgomery County, appellee lived in Montgomery County, appellee’s principle 8 place of business was in Montgomery County, and appellee had a medical condition which appellee alleged made travel difficult. The court found that the record did not support the trial court’s conclusions that Wilson’s choice of forum was oppressive or designed to harass appellees. The court stated “at best, the record reflects Appellees’ showing that Wilson’s chosen forum is ‘merely inconvenient’ to them. Thus, the trial court abused its discretion in granting the petition to transfer.” Wilson, 963 A.2d at 489. (internal citations omitted). Like in Wilson, Defendant in the present Action for Declaratory Judgment establishes only that Plaintiff’s choice of forum is inconvenient. Defendant Knapp alleges that (1) Beaver 9 County is “more convenient to the majority of witnesses in this matter,” (2) Knapp maintains business records relating to the Policy and medical records relating to the underlying claims in 10 Beaver County, (3) the burden to Dr. Knapp of proceeding in Cumberland County would be 11,12 significantly greater than the burden to PMSLIC of proceeding in Beaver County. Defendant also states the conclusion that litigation in Cumberland County would be unduly oppressive 1314 and/or vexatious for Dr. Knapp and to the Nominal Defendants. In reviewing Defendant Knapp’s reasons for requesting transfer of venue using the applicable standard, we find that Defendant has not met his burden of demonstrating that Plaintiff’s choice of forum is oppressive and/or vexatious. He states only matters of convenience and makes conclusory statements without the required supporting facts. Defendant has shown that Plaintiff’s choice of forum is merely inconvenient. Therefore, Defendant has not met his burden to allow a transfer of venue to Beaver County, and this action will proceed in 9 Petition to Transfer Venue, ¶19. 10 Petition to Transfer Venue, ¶ 23. 11 Petition to Transfer Venue, ¶ 27. 12 The Pennsylvania Superior Court has made it clear that a defendant must prove more than inconvenience and that using a balancing test is a misapplication of the law. See Catagnus v. Allstate Ins. Co., 864 A.2d 1259 (Pa. Super. 2004), see also Raymond v. Park Terrace Apartments, Inc., 882 A.2d 518 (Pa. Super. 2005). 13 Petition to Transfer Venue, ¶ 28. 14 Petition to Transfer Venue, ¶29 9 Cumberland County. Again, what is being decided here in Cumberland County is not the underlying claims of the Nominal Defendants against Dr. Knapp, but whether or not PMSLIC has any obligation to defend or indemnify Dr. Knapp. Accordingly, the following Order shall be entered: th AND NOW , this 9 day of May, 2011, after consideration of Defendants’ Preliminary Objections and Defendant Knapp’s Petition to Transfer Venue, IT IS HEREBY ORDERED AND DIRECTED that the Defendants’ Preliminary OVERRULEDDENIED. Objections are and Defendant Knapp’s Petition to Transfer Venue is By the Court, ______________________________ M. L. Ebert, Jr., J. Amanda R. Gerstnecker, Esquire Beth A. Slagle, Esquire Meyer, Unkovic & Scott, LLP 1300 Oliver Building Pittsburg, PA 15222 Attorneys for Defendant Knapp Charles F. Bowers III, Esquire Bowers Ross & Fawcett, LLC 820 Kennedy Drive P.O. Box 280 Ambridge, PA 15003 Attorney for Nominal Defendants Tracy Cotters, Kristy Palitti, Robert Laney, and Bobbi Ann Connifey Michael A. Murphy, Esquire Ogg, Murphy & Perkosky, LLP 245 Fort Pitt Boulevard Pittsburgh, PA 15222 Attorney for Nominal Defendant Regina Winters 10 Mechelle and David Poling 230 Dogwood Circle Baden, Pennsylvania 15005 Nominal Defendants 11