Lead Opinion
OPINION BY
Appellant, Carolyn Rickard, Administra-trix of the Estate of William Rickard, appeals from the order entered April 28, 2015, which denied her November 18, 2014 Petition for Order of Distribution in a Wrongful Death Action (“Distribution Petition”), for amounts secured through an insurance-claim settlement. For the reasons that follow, we reverse and remand to the common pleas court for proceedings consistent with this Opinion.
On July 2, 2010, William Rickard (“the Deceased”) and Appellant (collectively, “the Rickards”), filed for bankruptcy. Distribution Petition, 11/18/14, Attachment (In re: William J. Rickard and Carolyn M. Rickard,
While the Deceased was alive, he made a claim for underinsured benefits to ANPAC for the injuries he sustained in the accident’. As noted, the Rickards were debtors in bankruptcy at the time of the motor vehicle accident.
On October 20, 2014; the bankruptcy court refused to approve the settlement or distribution of the accident litigation proceeds,, nor did it make any distribution on its own, concluding that the Welfare Fund’s plan documents
The outcome of this case should not be construed as the [c]ourt concluding that counsel does not deserve his fee. In fact, the opposite is true. The record in this case is that counsel obtained an excellent result, worked diligently, competently, and professionally. Had' the [c]ourt been writing on a clean slate, the [c]ourt surely would have concluded that counsel has earned his contingent fee.
Id. at 10. The order entered by' the bankruptcy court provided: “And now, this 20th day of October, 2014, for the reasons set forth in the Memorandum Opinion filed herewith, .the Motion to Approve Settlement of the Underinsured Motorist Claim is denied.” Bankruptcy Court Order, 10/20/14 (“Bankruptcy Court Order”) (italics in original; emphasis added). Thus, there existed no settlement of the case.
Two days later, October 22, 2014, the day Appellant’s counsel avers she received the Bankruptcy Court Memorandum, William Rickard died, allegedly from the inju-ríes he sustained in the accident. Distribution Petition, 11/18/14, at unnumbered 3; Appellant’s Brief at 7. The next day, October 23, 2014, because there was no settlement, no distribution, and no living payee, counsel for Appellant returned the AN-PAC check. Appellant’s Brief at 7. The bankruptcy proceedings terminated one week later on October 29, 2014, when the Rickards’ case was dismissed from bankruptcy'with no settlement or distribution having been made. Distribution Petition, 11/18/14, at unnumbered 3.
Appellant then submitted a wholly new claim for underinsurance benefits to AN-PAC pursuant to the Pennsylvania Wrongful Death Act, 42 Pa.C.S. § 8301, on behalf of herself and the. Deceased’s daughter, Sarah Rickard.
Enclosed please find a copy of the Short Certificate evidencing the granting .... of Letters of Administration on the Estate of William J. Rickard to Carolyn Rickard on October 29,2014.
As I previously informed you, on October 22, 2014, Mr. Rickard succumbed to the injury and illness suffered as a result of his automobile accident.
Claim is hereby made, by Carolyn Rickard, Administratrix, under the Pennsylvania Wrongful Death Act, 42 Pa.C.S.A. § 8301 and Pa.R.C.P. 2202(a) for the full amount of the underinsurance coverage under the Rickards’ auto policy.
Brief in Support of the Wrongful Death Claim of Decedent’s Widow and Minor Child, Exh. E; Reproduced Record at 84A.
Under this wrongful-death claim, AN-PAC issued a check made payable to counsel and Appellant. Upon receipt of the ANPAC check, Appellant filed the within Distribution Petition before the orphans’ court division of the common .pleas court pursuant to Allegheny County Local Rule 2039 seeking distribution of the underin-surance settlement funds. The orphans’ court, in denying the Distribution Petition, determined that it was bound by collateral estoppel because the “issue before it [is] virtually identical to the issue decided by” the bankruptcy court. Orphans’ Court Opinion, 4/28/15, at unnumbered 2. In the alternative, the orphans’ court concluded that the Welfare Fund’s subrogated interest was superior to that of Appellant and her counsel.
Appellant filed a timely appeal. The orphans’ court did'not direct’Appellant to file a Pa.R.A.P. 1925(b) statement, and none was filed. Following oral argument, a panel of this Court, with one judge dissenting, filed a memorandum opinion affirming the orphans’ court’s decision. Rickard v. American National Property and Casualty Co., 774 WDA 2015,
Appellant raises the following three issues:
1) Does the instant bankruptcy court order which does not address whether an ERISA Fund may extend its subro-gation lien to a decedent’s wife and minor daughter serve as a basis to collaterally estop an orphans’ court claim for wrongful death damages made after the close of the bankruptcy matter?
2) Are the wrongful death beneficiaries, spouse and minor child, precluded from recovering benefits for their separate and distinct injury by lien language in an ERISA Health and Welfare Plan, when neither the lien amounts nor lien language apply to either of the beneficiaries?
3) Does the Supreme Court’s holding in U.S. Airways v. McCutchen,569 U.S. 88 ,133 S.Ct. 1537 ,185 L.Ed.2d 654 (2013) require that a subrogation lien on a decedent’s recovery for medical benefits paid out during a decedent’s lifetime, extend to his wife and minor daughter’s separate and. distinct recovery in a wrongful death action?
Appellant’s Brief at 4 (issues reordered).
The issue of whether the court applied the correct legal standard in distributing the wrongful death proceeds raises a question of law, ie., construction of the Welfare Plan’s subrogation and reimbursement clauses, which we review de novo. Moscatiello v. Hilliard,
Collateral estoppel applies if (1) the issue decided in the prior case is identical to one presented in the later case; (2) there was a final judgment on the merits; (3) the party against whom the plea is asserted was a party or in privity with a party in the prior case; (4) the party or person privy to the party against whom the doctrine is asserted had a full and fair opportunity to litigate the issue in the prior proceeding and (5) the determination in the prior proceeding was essential to the judgment. Collateral es-toppel, sometimes referred to as issue preclusion, operates to prevent a question of law or an issue of fact which has once been litigated and adjudicated finally in a court of competent jurisdiction from being relitigated in a subsequent suit. Kituskie v. Corbman,452 Pa.Super. 467 ,682 A.2d 378 , 382 (1996) (citations and quotation marks omitted). The decision to allow or to deny a prior judicial determination to collaterally bar relitigation of an issue in a subsequent action historically has been treated as a legal issue. As such, this Court is not bound by the trial coqrt’s conclusions of law and we may draw our own conclusions from the facts as established. Meridian Oil & Gas Enters., Inc. v. Penn Cent. Corp.,418 Pa.Super. 231 ,614 A.2d 246 , 250 (1992), appeal denied,534 Pa. 649 ,627 A.2d 180 (1993).
Westfield Ins. Co. v. Astra Foods Inc.,
In the present case, bankruptcy counsel asked the bankruptcy court to approve the settlement involving a living client in receipt of medical benefits from the Welfare Fund, but the bankruptcy court refused. In re: William J. Rickard and Carolyn M. Rickard,
The issue before us is whether a wrongful death beneficiary’s recovery under the Pennsylvania Wrongful Death Act is subject to a subrogation claim for benefits paid on behalf of the decedent for medical treatment during the decedent’s lifetime. This issue was not before the bankruptcy court, nor could it have been, as all of the relevant bankruptcy proceedings occurred during the Deceased’s lifetime. Thus, under the first prong of the test for collateral estoppel, the issue decided in the bankruptcy court is not identical to that presented herein.
The second prong requires a final adjudication on the .merits. A motion to approve settlement was before the bankruptcy court, and the court .denied it. The Deceased’s death two days later gave rise to a wholly new claim, and seven days later; the debtors’ case was dismissed from bankruptcy. There was no settlement, no determination on disbursement, and the bankruptcy court did not address the merits of whether the Welfare Fund’s subro-gation lien attaches to a wrongful death recovery.
The third prong requires that the party against whom the doctrine is asserted was a party or in privity with a party in the prior case. Sarah Rickard, the Deceased’s minor daughter, was not a party to the bankruptcy proceedings. As a statutory beneficiary, her right to recovery is separate and distinct from her mother’s claim.
Regarding the fourth prong, it is clear that no right to recovery of wrongful death benefits had accrued either to Appellant or Sarah Rickard prior to the entry of the bankruptcy court’s order. Therefore,- neither one had any opportunity to litigate the issue of whether the Welfare Fund’s lien attached to their recovery.
The issue the Welfare Fund sought to preclude the common pleas court from deciding was not before the bankruptcy court, could not have been brought before the bankruptcy court; and therefore, was not decided by the bankruptcy court. Thus, there is no foundation for the doctrine of collateral estoppel to have been applied in this case.
The alternative basis cited by the orphans’ court was its similarly conclusory pronouncement that pursuant to U.S. Airways v. McCutchen,
Pennsylvania courts have long recognized that a wrongful death action is separate and distinct from a survival action. Pisano v. Extendicare Homes, Inc.,
An action for wrongful death may be brought by the personal representative of those persons entitled to receive damages for wrongful death under the statute. Tulewicz v. S.E. Pa. Transp. Auth.,529 Pa. 588 , 596,600 A.2d 427 , 431 (1992).... Wrongful death damages are established for the' purpose of compensating the spouse, children, or parents of a deceased for. pecuniary loss they have sustained as a result-of the death of the decedent. Tulewicz,529 Pa. at 597 ,606 A.2d at 431 ....
A survival action, on the other hand, is brought by the administrator of the decedent’s estate in order to recover- the loss to the estate of the decedent resulting1 from1 the tort. Tulewicz,529 Pa. at 597 ,606 A.2d at 431 ....
These 'two actions are designed'' to compensate two different categories of claimants!,] the spouse and/or members of the decedent’s family for wrongful death of the decedent, and the decedent herself through the legal person of her estate. Tulewicz,529 Pa. at 597 ,606 A.2d at 431
Kiser v. Schulte,
Relatedly, we also reject applicability of McCutchen. That case involved a plan’s right to recover from a living plan participant’s bodily-injury settlement, medical benefits paid oh his behalf, and is therefore inapplicable to the instant case; the funds at issue were obtained on behalf of statutorily enumerated beneficiaries pursuant to the Pennsylvania Wrongful Death Act.
Lacking relevant interpretive Pennsylvania case law, we look to illustrative cases in other jurisdictions. In cases decided after McCutchen in other jurisdictions, courts have refused to allow ERISA liens seeking reimbursement for medical benefits paid during a, decedent’s lifetime to extend to his wrongful death beneficiaries after death. For example, in Estate of Shackelford,
Jerry Shackelford died at the1 hospital without regaining consciousness after -the crash. Mrs. Shackelford, the administratrix of his estate, obtained a settlement for both wrongful death and survival claims. Estate of Shackelford,
The Ohio Court of Appeals reversed, concluding that reliance on McCutchen was misplaced because that case did not involve the death of a plan participant, and thus, was factually distinguishable. Significantly, the court observed:
In support of its decision, - the probate court also and 'primarily relied on the Plan’s subrogation and reimbursement clause. However, a close reading of the clause shows that its provisions only relate to (1) payment, settlement, or judgment received by a covered person for "injury to the covered person, (2) the covered person’s damages, and (3) the covered person’s ■ conduct in abstaining from prejudicing the Plan’s subrogation or recovery interest. The clause does not relate to any payment, settlement, or judgment received by statutory wrongful death beneficiaries for injury they sustained as a result of the wrongful death of the-covered person; nor does it relate to damages of the statutory wrongful death beneficiaries. Other provisions of the clause such as the Plan’s lien- fights must necessarily be read in conjunction with the -overall clause which is restricted to medical expenses paid for the treatment of the covered person and settlements or judgments received by the covered person.
Estate of Shackelford,
We also examine MedCath Incorporated Employee Health Care Plan v. Stratton,
The Stratton Court determined that the plan’s contractual rights of subrogation and reimbursement did not apply to Ms. Stratton’s children, and therefore, its right to recovery could not transfer to their wrongful death claim. Stratton,
Having concluded that collateral estop-pel does not apply herein and that this case is not controlled by McCutchen, the two bases relied upon by the common pleas court, we must reverse and remand. We agree with Appellant that neither she nor her daughter received any benefits from the Welfare Fund related to the Deceased’s injuries. Any contractual obligation relating to subrogation or reimbursement that the Deceased may have owed the Welfare Fund does not transfer to any distinct wrongful-death recovery of Appellant and her daughter.
Order reversed. Case remanded. Jurisdiction relinquished.
Judges Olson, Dubow, Moulton, and Solano join this Opinion.
Judge Bowes joins this Opinion with separate writing and files a Concurring Opinion in which Judges Olson, Dubow, and Solano join.
P.J.E. Bender files a Dissenting Opinion in which Judges Panella and Lazarus join.
Notes
, Employee Retirement Income Security Act, 29U.S.C. §§ 1001 etseq.
.The record adduced below is sparse. Neither the ANPAC insurance policy nor the operative Plan language was introduced into evidence or attached to Appellant's petition. The parties stipulated to the accuracy of the Plan language before the bankruptcy court, however, and Appellant attached excerpts of the language, as quoted in the bankruptcy court’s memorandum opinion, to its petition. We have utilized a combination of attachments to documents, briefs, and the reproduced record in order to provide' explanation.
. The bankruptcy court represented that "the complete plan (the "Plan”) document is not of record, despite the fact that the parties filed a Stipulation that avers that the Plan is attached to it.” Bankruptcy Court Memorandum, 10/20/14, at 4 (emphasis in original) (footnote omitted).
, "Audio Recording of Hearing Held in Courtroom D, 8/29/14 (10:11 a.m.) ....” Bankruptcy Court Memorandum, 10/20/14, at 4.
. Once again, we lament the state of the certified record. While a brief by the Welfáre Fund is docketed as filed in the orphans’ court, the opposing brief of Appellant in support of the wrongful death claim is not. Appended to that brief are multiple documents that enhance understanding, indeed confirm the existence, of various facts in the instant case. Because those documents are shown as attachments in the Reproduced Record, we note their existence and applicability. See Nicolaou v. Martin,
. We note that we concur with Appellant’s position that ANPAC’s initial draft represent- - ed an offer to settle that was not accepted by the Deceased. Appellant's Brief at 26, The draft was returned to ANPAC after the Deceased's death. The Deceased never obtained title to any settlement funds; indeed, ANPAC is the only entity that held title to proceeds available under the Rickards’ personal automobile insurance policy, as evidenced by AN-PAC’s ability to issue a second draft in offer of settlement of the wrongful death claim. Id.
When the bankruptcy court denied the motion to approve settlement of the underin-sured motorist claim, there was no settlement. Appointed counsel- had no authority to enter into a settlement; any proposed settlement had to be approved by the bankruptcy court, which withheld approval. Nor could there have been a settlement, in light of the facts of this case, due to Mr. Rickard's nearly contemporaneous demise. During the time between the issuance of-the first ANPAC check and the bankruptcy court’s denial of settlement, there merely existed a draft — a piece of paper — representing bodily injury funds, that Appellant was not permitted to accept. Thus, due to the tight factual circumstances and time frame, when Mr. Rickard passed away, an entirely new claim arose, The ensuing wrongful death cause of action vested in the Deceased’s wife and daughter.
. We note our agreement with that portion of the Concurrence that concludes the Plan had the burden of proving a valid subrogation lien and that it failed to do so. Thus, on that basis as well, we conclude the Plan’s claim lacks merit.
Concurrence Opinion
CONCURRING OPINION BY
I reach the same result as the majority, but without reliance upon what I perceive as Administratrix’s arbitrary characterization of the UIM claim as one for wrongful death.
I agree with my distinguished colleagues that collateral estoppel is inapplicable. The issue before the bankruptcy court was not identical to the issue before us. The bankruptcy court found that the Plan had a lien against Mr. Rickard’s projected UIM recovery based on his undisputed status as a “Covered Individual,” his receipt of Plan benefits, and his concession that the Plan’s interest in the UIM recovery was superior to his own. The real dispute in that proceeding focused on whether counsel’s claim for attorney fees was superior to the Plan’s lien. The bankruptcy court concluded it was not and refused to approve the proposed UIM settlement. Mr. Rickard died two days later without consummating the settlement or recovering the UIM funds.
Mrs. Rickard made a claim for the UIM benefits under the auspices of the Wrongful Death Act, 42 Pa.C.S. § 8301, and AN-PAC issued a check. Although I do not believe the label she assigned to the claim controls or that it is material to our disposition, the Plan did not challenge her characterization of the claim as one for wrongful death. Consequently, this Court addressed the question as framed by Ad-ministratrix: whether a wrongful death beneficiary’s recovery is subject to subro-gation for medical benefits paid on behalf of the decedent during his lifetime. The majority answers that question in the negative. I submit that the real issue is whether UIM benefits recovered by Ad-ministratrix under the ANPAC policy were subject to subrogation by the Plan, and arrive at the same negative answer.
Under either scenario, collateral estop-pel does not apply. The bankruptcy court did not determine whether the Plan was entitled to subrogation against amounts recovered' by Administratrix. Preliminarily, we' do not know whether the UIM benefits paid to Administratrix represent a recovery to which she was entitled in her own right under the ANPAC policy, or whether it represented payment on behalf of her deceased husband. Since the AN-PAC policy is not contained in the record, and that issue was not developed, that question remains unanswered. In any event, the bankruptcy court did not address whether Mrs. Rickard was a “Covered Individual,” whether she received benefits from the Plan, or whether her recovery of the UIM benefits was subject to subrogation,, and thus, collateral estop-pel has no application.
The Plan argues, in the alternative, that under U.S. Airways v. McCutchen,
Finally, the Plan cites Gillette v. Wurst,
In this case, as distinguished from Gillette, the Plan failed to prove that Admin-istratrix received Plan benefits, or that she was a “covered individual” or a covered individual’s representative under the Plan for purposes of a subrogation lien. I submit that the ANPAC insurance policy and the Plan documents, rather than the designation of the claim as one for wrongful death, controlled whether th.e Plan had a valid subrogation lien against the UIM proceeds recovered by Administratrix. The Plan did not reference those documents in establishing its right to subrogation, nor did it include them in the certified record. Since the Plan sought to enjoin the proposed distribution, it had the burden to prove a valid subrogation lien, which it failed to do. For these reasons, I concur in the result of the majority.
Judges Olson, Dubovrand Solano join this concurring opinion.
. Administratrix did not file a formal wrongful death action against the insurer seeking the UIM benefits. Nor do I believe that she could have. A wrongful death claim is one statutorily authorized against a third-party tortfeasor. The UIM claim herein was a contract claim pursuant to an insurance policy.
Dissenting Opinion
DISSENTING OPINION BY
I respectfully disagree with the Majority’s decision to reverse the order denying Appellant’s Distribution Petition and its conclusion that collateral estoppel does not apply to the instant matter.
As the Majority indicates, because the Deceased’s accident was work-related, the Welfare Fund paid $279,498.03 in related medical bills and disability payments. Appellant and the Deceased had commenced bankruptcy proceedings prior to the accident; thus, the bankruptcy court appointed counsel to prosecute the litigation regarding the accident and retained the right to approve or disapprove any settlement reached during the course of the Rickards’ bankruptcy. In January of 2014, counsel secured settlement for the full amount of the ANPAC underinsurance coverage, $250,000,00, and filed a motion with the bankruptcy court to approve the settlement.
The Welfare Fund intervened and objected to any distribution of funds to the Rickards. According to the Welfare Fund’s plan (“the Plan”), its subrogated interest in any settlement was .superior to the interests of the Rickards or their counsel. The bases for its argument rested on excerpts of the terms governing the Plan:
Any sums recovered by the Covered Individual .... or their representative either by judgment, settlement, or any other means, and regardless of whether such sums are designated as reimbursement for medical expenses incurred or anticipated, past or future wage loss, pain and suffering, or any other form of damages, shall be applied first to reimburse the [Welfare Fund] in full and therefore shall be deducted first from any recovery by or on behalf of the Covered Individual.
Appellant’s Brief, 3/21/17, App. 2 (In re: William J. Rickard and Carolyn M. Rickard,
After litigation of the matter, the bankruptcy court concluded that the Welfare Fund’s interest was superior to the interest of the Rickards and their counsel.- See id. at 5, 9. Accordingly, the court denied the Rickards’ motion to approve settlement. No appeal was taken from the bankruptcy court’s decision.
Shortly after the passing of her husband and dismissal of their' bankruptcy case, Appellant commenced a wrongful death claim, for underinsured benefits, pursuant to the Pennsylvania Wrongful Death Act, 42 Pa.C.,S. § 8301,
Following a hearing on the Distribution Petition, the orphans’ court determined that the bankruptcy court’s decision controlled and, thus, Appellant was estopped from seeking distribution of the settlement funds. See id. I agree with the orphans’ court that the doctrine of collateral estop-pel applies here and predudes our further consideration of Appellant’s arguments.
As held by the Pennsylvania Supreme Court:
The doctrine of collateral estoppel precludes relitigation of an issue determined in a previous action if:- (1) the issue decided in the prior case is identical to the one presented in the later action; (2) there was a final adjudication on the merits; (3) the party against whom the plea is asserted was a party or in privity with a party in the prior case; (4) the party or person privy to the party against whom the doctrine is asserted had a full and fair opportunity to litigate the issue in the prior proceeding; and (5) the determination in the prior proceeding was essential to the judgment. Collateral estoppel relieves parties of the cost and vexation of multiple lawsuits, conserves judicial resources, and, by preventing inconsistent decision, encourages reliance on adjudication.
Office of Disciplinary Counsel v. Kiesewetter,
I respectfully disagree with the Majority’s conclusion that the requirements for collateral estoppel have not been met. First, the Majority asserts that the issue before us is whether the Welfare Fund’s subrogation claim attaches to a wrongful death beneficiary’s recovery under the Pennsylvania Wrongful Death Act, and that this issue was not before the bankruptcy court. Accordingly, the Majority concludes that the first two prongs of the test for collateral estoppel have not been met. To the contrary, the dispositive issue before this Court, as it was before the bankruptcy court, is whether the Welfare Fund’s subrogated interest in any settlement, as defined by the Plan’s governing terms, is superior to the interests of the Rickards or their counsel. Following a full and fair opportunity to litigate this issue, the bankruptcy court ruled in favor of the Welfare Fund. Its ruling is final. Accordingly, Appellant is estopped from re-litigating this issue.
The Majority further states that the third prong has not been met because Appellant’s claim involves different parties than were involved in the bankruptcy proceedings. This is simply inaccurate. The relevant party involved in the prior proceedings was the Deceased, the named insured and designated recipient of the ANPAC settlement funds, as well as the beneficiary of the Welfare Fund’s medical benefits. Here, the only relevant party of record is Mrs. Rickard, solely in her capacity as administratrix of her deceased husband’s estate.
Finally, the last element of collateral estoppel has clearly been met, since the determination of the issue regarding the Welfare Fund’s lien priority was essential to the bankruptcy court’s ruling.
For these reasons, I would affirm the April 18, 2015 order denying Appellant’s Distribution Petition.
Judge Panella and Judge Lazarus join this dissenting opinion.
. The Rickards agreed to pay'appointed counsel a contingency fee of up to 40% of any settlement secured on Mr. Rickard's behalf., Thus, the proposed distribution included payment of $100,000.00 to counsel; $1,000.00 to bankruptcy counsel; and the- remaining balance of $149,000,00 to Mr. Rickard.
. Pursuant to the Pennsylvania Wrongful Death Act:
An action may be brought, under procedures prescribed by general rules, to recover damages for the death of an individual caused by the wrongful act or neglect or unlawful violence or negligence of another if no recovery for the same damage's claimed in the wrongful death action was obtained by the injured individual during his lifetime and any prior actions for the same injuries are consolidated with the wrongful death daim so as to avoid a duplicate recovery.
42 Pa.C.S. § 8301(a).
. The Distribution Petition, filed on November 18, 2014, sought "distribution of the funds under the Wrongful Death Act, with approximately $75,000 going to counsel, approximately $100,000 to [Appellant] (as the Widow), and approximately. $72,000 to the [Deceased's] minor child.” Id.
. Neither Mrs. Rickard, on her own behalf, nor Ms. Sarah Rickard are parties to this appeal.