197 A.3d 267
Pa. Super. Ct.2018Background
- May 12, 2014 fire at Hebron, Inc.’s vehicle dismantling facility during refueling of a company truck; fire damaged Hebron and neighboring property.
- Hebron held a commercial liability policy issued by Tuscarora Wayne Insurance Company (TWIC) that included an endorsement excluding coverage for specified "designated ongoing operations" listed as "vehicle dismantling."
- TWIC filed a declaratory judgment action seeking a ruling that it had no duty to defend or indemnify Hebron for claims arising from the fire due to the "vehicle dismantling" exclusion.
- Discovery included depositions of Hebron employees; facts showed dismantling operations had ceased ~30 minutes before the fire and only two employees were refueling a truck when an extension cord sparked.
- Trial court granted TWIC’s summary judgment and denied Hebron’s, concluding refueling was incidental to vehicle dismantling and thus excluded; Hebron appealed.
- The Superior Court reversed, finding the trial court misapplied the law by treating the fueling incident as within the exclusion given the facts and construing exclusions against the insurer.
Issues
| Issue | Plaintiff's Argument (Hebron) | Defendant's Argument (TWIC) | Held |
|---|---|---|---|
| Was the September 12, 2017 order final/ripe for appeal? | Order disposed of all claims in the declaratory action; appeal is ripe. | Trial court viewed UIP as remaining party so order not final. | Appeal is final and ripe; declaratory judgment treated as having force of final judgment. |
| Does the "vehicle dismantling" exclusion bar coverage for the fire? | The fire arose from refueling unrelated to dismantling; exclusion ambiguous and must be construed for insured. | Fueling was incidental to vehicle dismantling operations; exclusion applies and bars coverage. | Trial court erred; material facts show fueling was separate from dismantling and exclusion should be construed against insurer — TWIC not entitled to summary judgment. |
| Was Hebron entitled to summary judgment requiring TWIC to defend/indemnify? | If exclusion does not apply as a matter of law, Hebron is entitled to summary judgment. | Summary judgment for Hebron improper because exclusion covers incident. | Because exclusion did not apply on the record, Hebron entitled to summary judgment; trial court’s denial reversed. |
| Was denial of Hebron’s motion to compel TWIC corporate designee reversible? | Deposition sought to learn insurer’s basis for interpreting policy; necessary to resolve coverage. | Trial court denied; insurer need not produce at that time. | Issue mooted by reversal on coverage; trial court’s denial deemed moot. |
Key Cases Cited
- National Cas. Co. v. Kinney, 90 A.3d 747 (Pa. Super. 2014) (standards for declaratory judgment review and finality of such orders)
- Paylor v. Hartford Ins. Co., 640 A.2d 1234 (Pa. 1994) (clear policy language is enforced as written)
- Swarner v. Mutual Ben. Group, 72 A.3d 641 (Pa. Super. 2013) (ambiguities in exclusions construed against insurer)
- Caro v. Glah, 867 A.2d 531 (Pa. Super. 2004) (summary judgment standard and view of record)
- Miller v. Sacred Heart Hosp., 753 A.2d 829 (Pa. Super. 2000) (abuse of discretion defined)
- Lineberger v. Wyeth, 894 A.2d 141 (Pa. Super. 2006) (further discussion of abuse of discretion standard)