Presently before this court is defendant CGU Insurance Co.’s motion for partial reconsideration of this court’s order of October 8, 2001, denying defendant CGU’s motion for summary judgment. Plaintiff, the Brickman Group Ltd., has filed its response in opposition to the motion for reconsideration.
For the reasons set forth in this opinion, this court is granting the motion for partial reconsideration and entering summary judgment in favor of CGU on all remaining counts of plaintiff’s amended complaint.
BACKGROUND
This dispute arises over defendant CGU’s alleged failure to abide by a purported agreement to sell a full program of various types of liability insurance to plaintiff Brickman under the same terms and conditions, including premium rates, for a six-year period between July 1, 1997, and July 1, 2003. (See second am. compl. ¶1.
Certain material facts are undisputed. First and foremost, the parties do not dispute that the insurance policies sold to Brickman do not contain any of the terms of the insurance program guarantee. (See def.’s mem. of law in support of def. ’ s mot. for summ. j. at 5; pi.’s mem. of law in opposition to def.’s mot. for summ. j. at ll.)
In addition, Brickman did not pay additional monies for the purported insurance program guarantee, beyond the premiums paid for the insurance policies. (See def.’s
Even if other facts are in dispute, the above-stated undisputed facts are fatal to plaintiff’s breach of contract claims since those claims are singularly based on the insurance program guarantee.
DISCUSSION
In its motion for partial reconsideration, defendants focus on the narrow issue of whether the insurance program guarantee, upon which plaintiff bases its breach of contract claim(s), is unenforceable and illegal under Pennsylvania law because it violates 40 P.S. §275
Generally, “[mjotions for reconsideration are discouraged unless the facts or law not previously brought to the attention of the court are raised.” S.A. Arbittier et al., Philadelphia Court of Common Pleas Civil Practice Manual, §7-2.8 (10th ed. 2000). A court has inherent power to reconsider its own rulings. Moore v. Moore, 535 Pa. 18, 25, 634 A.2d 163, 167 (1993); Hutchison v. Luddy, 417 Pa. Super. 93, 108, 611 A.2d 1280, 1288 (1992). See 42 Pa.C.S. §5505 (trial court may reconsider its own order within 30 days of entering the order). “The statute limiting the time for reconsideration of orders to 30 days applies only to final, appealable orders.” Hutchison, 417 Pa. Super. at 108, 611 A.2d at 1288. “Where an order does not effectively place the litigant out of court or end the lawsuit, it is within the trial court’s discretion to entertain a motion to reconsider the interlocutory order outside the 30-day time limit set forth in 42 Pa.C.S. §5505.” Id.
Under the Pennsylvania Rules of Civil Procedure, the court must grant summary judgment if (1) there is no
Under Pennsylvania law, insurance agents and insurance companies are prohibited from offering or granting premium rebates, special advantages or other inducements to a prospective client to secure an insurance con
“No insurance agent, solicitor or broker, personally or by any other party, shall offer, promise, allow, give, set off, or pay, directly or indirectly, any rebate of, or part of, the premium payable on the policy ... or other benefit founded, arising, accruing or to accrue thereon or therefrom, or any special advantage in date of policy or age of issue, or any paid employment or contract for services of any kind, or any other valuable consideration or inducement, to or for insurance on any risk in this Commonwealth, now or hereafter to be written, which is not specified in the policy contract of insurance; nor shall any such agent, solicitor, or broker, personally or otherwise, offer, promise, give, option, sell or purchase any stocks, bonds, securities, or property or any dividends or profits accruing or to accrue thereon, or other thing of value whatsoever, as inducement to insurance or in connection therewith. . . .” 40 P.S. §275. (emphasis added) Section 471, which applies to insurance companies, associations or exchanges, including its officers or members, contains a parallel provision that similarly prohibits insurance companies from offering any special advantage or inducement which is not specified in the insurance policy. 40 P.S. §471.
“The object of this legislation is to outlaw unfair treatment of prospective insurance clients of the same class.” Blouch v. Clifford R. Zinn & Son Inc., 350 Pa. Super. 327, 331, 504 A.2d 862, 864 (1986) (citing McDowell v. Good Chevrolet-Cadillac, 397 Pa. 237, 242, 154 A.2d*499 497, 500 (1959)). As stated by the Pennsylvania Supreme Court:
“The thrust of the anti-rebate provisions of the statute is against the placement of insurance whereby the insured secures the insurance at a favored rate, regardless of the mode of the manner in which such favored rate is obtained. The court below well stated that ‘as is universally stated and recognized, a reduction of cost is the test of whether or not the statute is being violated’ . . . .” McDowell, 397 Pa. at 242-43, 154 A.2d at 500. See also, 5 Couch on Insurance §69.33 (3d ed. 1996) (“The purpose of statutes prohibiting discrimination and of anti-rebate statutes is to protect the solvency of the insurance companies, prevent unfair discrimination among insureds of the same class, protect the quality of service, avoid concentration of the market in a few insurance companies, and avoid unethical sales practices.”).
Defendant relies upon American Association of Meat Processors v. Casualty Reciprocal Exchange, 527 Pa. 59, 588 A.2d 491 (1991). In that case, the defendant insurer paid a rebate to the plaintiff association based on a percentage of the premiums paid to the insurer under the workers’ compensation insurance program. Id. at 62, 588 A.2d at 493. The payments were made to the association under assignments made by the association’s insured members. Id. In the final year, the defendant insurer failed to pay a dividend or rebate to the association and the association brought a breach of contract action against the insurer. Id. The rebate arrangement was pursuant to an oral agreement which was not set forth in the policy. Id. at 63, 588 A.2d at 493. Both the trial court and the Superior Court upheld the judgment in favor of the asso
Plaintiff, in turn, relies upon Commonwealth v. Fuhrer, 52 D.&C.2d 142 (Dauphin Cty. 1970), aff’d, 218 Pa. Super. 867, 279 A.2d 233 (1971), which involved an appeal of an adjudication of the Pennsylvania Insurance Commissioner which suspended the insurance agent’s license and imposed a fine upon him, based on the determination that he violated section 275 in offering an inducement to obtain insurance business. 52 D.&C.2d at 142-43. The agent, acting on behalf of an insurance company had an arrangement with a bank, pursuant to which the bank would collect premiums for credit life insurance for the bank’s consumer loan customers. Id. at 142. The bank would thereby retain the monies in an account which maintained a minimum balance and would afford the accrual of interest. Id. The court found that there was no evidence that the agent made representations to prospective insureds or customers of the bank, but that the insurance rate that would be charged would be as prescribed by the Insurance Department without exception or qualification. Id. at 145. The court also found no evidence that the agent made any offer or inducement to make it possible for insureds to obtain insurance from
Here, it is undisputed that the insurance program guarantee was not incorporated in the insurance policies sold to Brickman. Further, Brickman concedes that it relied on the insurance program guarantee in moving its business from Royal to CGU and in remaining with CGU. (See second am. compl. ¶¶15-16, 22-23, 25.) Plaintiff, indeed, contends that the insurance program guarantee is a separate and distinct contract from the insurance policies. (See pl.’s mem. of law in opposition to def.’s mot. for summ. j. at 11.) This very argument proves fatal to plaintiff’s breach of contract claims.
“As a general rule, an agreement which violates a statutory provision, ‘or which cannot be effectively performed without violating [a] statute, is illegal, unenforceable and void ab initio.’ ” Watrel v. Commonwealth, Department of Education, 88 Pa. Commw. 1, 5, 488 A.2d 378, 381 (1985), aff’d, 513 Pa. 61, 518 A.2d 1158 (1986). See also, Bollinger Co. v. Widmann Brewing Corp., 339 Pa. 289, 293, 14 A.2d 81, 83 (1940) (“courts will not lend their aid to the enforcement of unlawful contracts which are founded upon transactions in violation of a public policy declared by the legislature.”).
Thus, here, similar to American Ass’n of Meat Processors, the insurance program guarantee was not incorporated or endorsed within the insurance policies. Further, it seems clear that the insurance program guarantee was an “inducement” or special advantage to purchase insurance. As such, it may be deemed illegal under either 40 PS. §275 or 40 P.S. §471. While this court does
CONCLUSION
For the reasons set forth above, this court is entering a contemporaneous order, granting the motion for partial reconsideration and granting summary judgment in favor of CGU on the breach of contract claims.
ORDER
And now, March 26, 2002, upon consideration of defendant CGU Insurance Co.’s motion for partial reconsideration of the order, dated October 8, 2001, denying defendant’s motion for summary judgment, plaintiff’s response in opposition thereto, all other matters of record and in accord with the opinion being filed contemporaneously with this order, it is hereby ordered that the motion for partial reconsideration is granted and summary judgment is entered in favor of CGU Insurance Company and against The Brickman Group Ltd. on the remaining counts of the second amended complaint, sounding in breach of contract.
. On August 30,2001, plaintiff filed a second amended complaint which amplified its factual averments to its breach of contract claims in Counts I and II, following this court’s order and opinion, dated August 3, 2001, granting leave in part to file the amended complaint. The second amended complaint is to be treated as the only complaint before this court as it supersedes all previously filed complaints. See Vetenshtein v. City of Philadelphia, 755 A.2d 62, 67 (Pa. Commw. 2000) (an amended complaint virtually withdraws the original complaint and takes its place), (citations omitted)
. Plaintiff does not dispute this fact but maintains that the insurance program guarantee is a distinct and separate contract, apart from the insurance policies, and that Pennsylvania law and the practice in the trade do not require rate guarantees to be attached as an endorsement to insurance policies. (See pl.’s mem. of law in opposition to def.’s mot. for summ. j. at 11.) For the reasons set forth in the “discussion” section of this opinion, this court disagrees with this contention.
. The Insurance Department Act of 1921, May 17, P.L. 789, art. VI, §635.
. The Insurance Company Law of 1921, May 17, P.L. 682, art. HI, §346.
. Here, defendants’ motion for reconsideration is of an order which is interlocutory in nature, and, thus, the 30-day time limit does not apply though the motion was filed within that time limit.
