Century Sur. Co. v. Essington Auto Ctr., LLC
140 A.3d 46
| Pa. Super. Ct. | 2016Background
- Essington Auto Center, its officers (Robert Nguyen, Cuong Ung) and employees (Davis Nguyen, Trong Truong) were defendants in underlying personal-injury suits after a 2012 collision that occurred while Davis was driving Truong’s vehicle with two injured passengers as plaintiffs.
- Century Surety issued a Garage Liability Policy to Essington with $1,000,000 limits for "garage operations," but an endorsement reduced coverage for drivers under 21 to the state’s basic financial responsibility limits.
- Century filed a declaratory-judgment action seeking a determination that the reduced-limits endorsement applied to Davis (age 20), limiting coverage; it served all defendants except Davis, for whom it obtained court permission for alternate service by posting at a Chester Springs address.
- Essington, Robert, and Truong answered and pleaded new matter arguing the endorsement is inapplicable because the accident did not involve "garage operations," and thus full policy limits should apply.
- Century moved for judgment on the pleadings based on what it characterized as a judicial admission in defendants’ new matter; the trial court granted judgment on the pleadings in Century’s favor as to all defendants and entered default against Davis; Davis later moved to open/strike the default, which the trial court denied.
- The Superior Court reversed: (1) judgment on the pleadings was improper because the "garage operations" issue involved legal interpretation and the new-matter language was ambiguous (not a clear judicial admission); and (2) the default should be opened because Century failed to make a good-faith effort to give Davis actual notice (it knew Davis had counsel but did not contact counsel before seeking alternate service).
Issues
| Issue | Plaintiff's Argument (Century) | Defendant's Argument (Essington/Robert/Davis) | Held |
|---|---|---|---|
| Whether Essington/Robert’s new-matter statement was a binding judicial admission that the accident did not involve "garage operations" | The new matter unequivocally admitted no "garage operations," so reduced limits apply | The statement is a legal conclusion or ambiguous and not an unequivocal factual admission | Reversed: not a judicial admission — issue requires legal interpretation of the policy and the new matter is ambiguous |
| Whether Century was entitled to judgment on the pleadings based on that admission | Admission resolves coverage; no factual dispute; judgment appropriate | Coverage involves contract interpretation (legal question); pleadings do not eliminate dispute | Reversed: judgment on the pleadings improper; contract interpretation is for the court and pleadings conflicted |
| Whether alternate service by posting at Davis’s Chester Springs address satisfied due process | Procedures of Pa.R.C.P. 430 were followed; posting was appropriate after unsuccessful attempts | Century knew Davis had counsel (Livingood) and did not contact counsel; posting was not a good-faith effort to provide actual notice | Reversed: substitute service insufficient because Century failed to attempt actual notice to known counsel; default must be opened |
| Whether the default judgment against Davis should be opened | (Implicit) Service was valid; default proper | Service invalid for lack of good-faith notice; Davis promptly moved to open and has defense issues | Reversed: default should be opened for lack of valid service/notice |
Key Cases Cited
- Sw. Energy Prod. Co. v. Forest Res., LLC, 83 A.3d 177 (Pa. Super. 2013) (standard of review and use of judgment on the pleadings)
- John B. Conomos, Inc. v. Sun Co. (R&M), 831 A.2d 696 (Pa. Super. 2003) (judicial-admission principles; admissions must be clear and unequivocal)
- Cogley v. Duncan, 32 A.3d 1288 (Pa. Super. 2011) (distinguishing factual admissions from legal conclusions)
- Humberston v. Chevron U.S.A., Inc., 75 A.3d 504 (Pa. Super. 2013) (contract interpretation is a question of law)
- Deer Park Lumber, Inc. v. C.B. Major, 559 A.2d 941 (Pa. Super. 1989) (substituted service and requirement of notice for opening judgments)
- PNC Bank, N.A. v. Unknown Heirs, 929 A.2d 219 (Pa. Super. 2007) (due-process notice requirements for substituted service)