Kent & McBride...

ON THE RECORDPublished Newsletter for our Valued Clients - May 2007

THIS ISSUE

NOTABLE CASES AND VOICESFROM THE BENCH

Pennsylvania Superior Court Holds

No Excuse Needed to Open Default

Judgment if Filed within 10 Days

Pennsylvania Supreme Court

Addresses Employer’s Burden of

Proof in Suspending Workers’

Compensation Benefits

Settlement Starts UIM Clock

Legislative Update

New Amendments to Title 231

of the Pennsylvania Code

Recent Verdicts

McDonnell Obtains Dismissal in

Med-Mal Cases

Off the Record

Well Wishes from K&M

PENNSYLVANIA SUPERIOR COURT HOLDS NOEXCUSE NEEDED TO OPEN DEFAULT JUDGMENT

IF FILED WITHIN 10 DAYS

Notable Cases and Voices from the Bench

The Pennsylvania Superior Courtwas recently asked to determine

whether Pennsylvania Rule of CivilProcedure 237.3(b) eliminates the tra-ditional common law requirement thata reasonable excuse for the late filingor non-filing be provided prior toopening a default judgment. Attix. et.al. v. Lehman, 2007 WL 1544644 (Pa.Super. 2007). The Court held that itdid.

In this matter, a minor bicyclist wasinjured when he was struck byDefendant’s vehicle. His parents filedthis action on his behalf. Defendantfailed to file a timely answer to thecomplaint and Plaintiffs providednotice that they would seek a defaultjudgment. Defendant failed to respondto that notice and Plaintiffs filed for adefault judgment in this matter. TheCourt entered the default judgment.Within ten (10) days of the entry ofdefault, Defendant filed a petition toopen the default judgment and attacheda proposed answer to that petition. Thetrial court denied the petition andDefendant appealed.

Under traditional common law, aDefendant was required to include intheir petition to open a default judg-ment, a reasonable excuse for their latefiling or non-filing. Pa.R.C.P. 237.3(b)however provides that if a petition forrelief from a default is filed within 10

days after the entry of judgment on thedocket, the Court shall open the judg-ment if the proposed complaint oranswer states a meritorious cause ofaction or defense.

The Court noted that default judg-ments are generally not favored. Thepurpose of allowing defaults to betaken ‘is to prevent a dilatory defen-dant from impeding the plaintiff inestablishing his claim’; it is not intend-ed as a means for a plaintiff to quicklyobtain a judgment without the difficul-ties of litigation. Peters Twp SanitaryAuth. v. Am. Home & Land Dev. Co.,696A.2d 899, 902 (Pa. Commw. 1997).Upon reviewing and interpreting the Rule,the Court held that Pa.R.C. P. 237.3(b)eliminated the requirement of a reason-able excuse. The Court held that if thepetition was filed within 10 days andstates a meritorious defense, the trialcourt must open the default judgment.

This case is important as it interprets Rule237.3(b) and provides the Defendant anabsolute right to have a default judgmentopened if they act quickly. On the otherhand, Rule 237.3(b) also allows plaintiffs toopen a judgment of non-pros without pro-viding an excuse if they act quickly.

For additional information, please contact TheresaMullaney at:tmullaney@kentmcbride.com

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The Supreme Court of Pennsylvaniahas addressed the burden of proof

assigned to an employer when theemployer petitions to suspend anemployee’s indemnity benefits based onthe employee’s bad faith rejection ofavailable employment.

In order to suspend an employee’s ben-efits, generally, an employer must pro-duce medical evidence illustrating thatthe employee has recovered some or allof his/her ability and the employer mustprove that they referred the employee toan open job within the employee’sphysical capabilities. The employeemust then demonstrate that he/she fol-lowed through with the job referrals ingood faith. If the employee followsthrough with the job referral and thereferral fails to result in employment forthe employee, the employee’s benefitsshould continue.

In Pitt Ohio Express vs. WCAB(Wolff), 912 A.2d 206 (Pa. 2006), theSupreme Court clarified the burden ofproof assigned to employers with regardto a Petition to Suspend Benefits whenthe employee, in bad faith, rejectsemployment offered to him/her withinthe occupation category for which theemployee has been given medical clear-ance. In this case, the Employee’s ben-efits were suspended due to a bad faithrejection of a job offer. The Employee’sbenefits were then reinstated due to aworsening of condition (surgery). Oncethe Employee recovered from his surgi-cal procedure, the Employer once againfiled a Petition to Suspend Benefits,arguing that the Employee had recov-ered from the work injury sufficientlyenough to perform the modified workoffered to him by the Employer, but hadfailed to return to work. The Employee

testified that he was, in fact, capable ofperforming the modified duty positionbut did not return to work. TheEmployee’s benefits were then sus-pended.

The Employee appealed the suspensionof benefits, arguing that the Employerdid not satisfy its burden by showingcontinued job availability. TheSupreme Court of Pennsylvania eventu-ally reviewed this issue and determinedthat the Employee’s bad faith relievedthe Employer of its responsibility toshow that a suitable position was avail-able to the Employee. In so holding, theCourt reasoned that they would notassign a never-ending duty to keep a jobavailable to an employee who rejectsthe job in bad faith.

For additional information, please contact ChristinePapa at: cpapa@kentmcbride.com

SETTLEMENT STARTSUIM CLOCK

The 3rd Circuit Court of Appeals wasfaced with a novel question in the

case of State Farm Mutual AutomobileInsurance Co. v. Rosenthal, 484 F.3d251, C.A.3 (Pa. 2007). The issue thatthe court set out to determine was whenthe four-year statute of limitationsbegins to run on underinsured motoristclaims. Three possibilities wereadvanced: (1) the date of the accident(State Farm’s argument); (2) the date onwhich the insured settles with theadverse driver for less than the insured’sdamages (Rosenthal’s argument); or (3)the date on which the insurer rejects theinsured’s underinsured motorist claim(the District Court’s holding).

In June of 1998, Brian Rosenthal, aState Farm insured, was in a motorvehicle accident that resulted in a $1-$2million loss of earnings for thePennsylvania attorney. In June of2003, Rosenthal settled his claimagainst the adverse driver for $85,000.Rosenthal’s attorney requested thatState Farm approve the settlement andadditionally informed the insurer of hisintent to pursue a UIM claim againstState Farm. Rosenthal’s attorneydemanded an underinsured motorist

arbitration from State Farm. In response,State Farm filed a complaint with theDistrict Court seeking declaratory judg-ment, stating that Rosenthal’s underin-sured motorist claim was time-barredby the four year statute of limitations.Rosenthal responded by filing a motionfor summary judgment.

A unanimous three-judge panel rejectedState Farm’s motion for declaratoryjudgment, and further rejected theirargument that the statute of limitationsshould begin to run on the date of theaccident. The court also declined theDistrict Court’s contention that theclock began to run on the date the insur-er rejects the insured’s UIM claim.

Instead, the 3rd Circuit Court ofAppeals ruled that the clock does notstart running on a claim for underin-sured motorist (UIM) benefits until theinsured settles with the adverse driverfor less than the value of his damages.The court reasoned that“[u]nlike anuninsured motorist case where the issueof whether a motorist has coverage atall is easily determined, the question ofwhether an insured motorist has enoughcoverage is not.” Thus, the above men-tioned holding sought to harmonize thelaw with respect to the statute of limita-tions regarding uninsured and underin-sured motorist claims. Regardless ofwhether the adverse driver is underin-sured or uninsured, the date that theclock starts is essentially the same, “i.e.the date on which the insured definitelyascertains the deficient insurance statusof the adverse driver.”

(Special acknowledgment to Law ClerkJennifer L. Weidler for the preparationof this article.)

For additional information, please contactDominique Ryan at: dryan@kentmcbride.com

PENNSYLVANIASUPREME COURT

ADDRESSES EMPLOYER’S BURDEN

OF PROOF IN SUSPENDING WORKERS’

COMPENSATION BENEFITS

The Supreme Court of Pennsylvaniapromulgated a new Rule of Civil

Procedure concerning cross-claims.Under the new rule, 1031.1, the assertionof a claim by one party against anotherparty to an action is a matter of pleading,as opposed to joinder of parties. Underthe new rule, the claim is pleaded as across-claim.

The second noteworthy amendmentrelates to the rules governing joinder ofadditional defendants. Rule 2252(a) wasamended in an attempt to limit the rulesgoverning joinder of additional defen-dants to the joinder of persons not alreadyparties to an action. The joinder may beeffectuated by “any party,” not merely thedefendant or additional defendants, as theprior rule held.

Under the old Rule 2253(a), governingthe time frame for joinder, an additionaldefendant, without leave of court, had“sixty days after the service upon theoriginal defendant of the initial pleadingof the plaintiff or any amendment there-of.” The revised rule allows a joiningparty to join an additional defendantwithout leave of court if the joinder isaccomplished within one of two timeframes (whichever is longer). The first ofthese is the sixty-day time period, men-tioned above. The second time frame isnew and relates to the time for the filingof the joining party’s answer to the timeset forth under Rule 1026, Rule 1028 oran order of court. The new language ofRule 2253(a) also allows for late joinder“by the written consent of all partiesapproved by and filed with the court.”Additionally, it requires the filing withintwenty days of the praecipe for writ ofsummons or of the complaint joining theadditional defendant. Subdivision (b) ofRule 2253 governs the procedure forobjection to a proposed late joinder of anadditional defendant. Any party mayobject to the motion to join on the

grounds of prejudice. However, only theplaintiff may object on the grounds of theabsence of reasonable justification for thedelay in commencing the joinder pro-ceeding.

The new subdivision (c) governs the pro-cedure by which a person not previouslya party who has been joined as an addi-tional defendant may object to his or herlate joinder. The person joined as anadditional defendant may object to his orher late joinder by filing preliminaryobjections, raising the ground of preju-dice and any other ground applicableunder Rule 1028 governing preliminaryobjections.

One rescinded rule that is of note wasRule 2255(b). It previously prohibitedthe filing of pleadings between an addi-tional defendant and “any party otherthan the one joining the additional defen-dant.” Rule 2256(c) was also rescinded,which read “[a] party against whom acounterclaim is asserted shall have thesame right to join any one as an addition-al party that is given to a defendant inRule 2252.”

Apart from the joinder and cross-claimchanges, there were a few minor amend-ments made to other Civil ProcedureRules. One such revision was to Rule425, governing service upon additionaldefendants. The burdensome require-ment that the joining party serve with thecomplaint copies of all pleadings in theaction was deleted. Instead, “the joiningparty, upon request, shall furnish copiesof all or specified pleadings filed in theaction.”

(Special acknowledgment to Law ClerkJennifer L. Weidler for the preparation ofthis article.)For additional information, please contact DominiqueRyan at: dryan@kentmcbride.com

RECENTVERDICTS

NEW AMENDMENTSTO TITLE 231 OF THEPENNSYLVANIA CODE

MCDONNELL OBTAINSDISMISSAL IN

MED-MAL CASES

K ent & McBride Senior AssociateJeffrey McDonnell was recently

successful in having several clients dis-missed from three separate medical mal-practice actions. Two were voluntarydismissals, one involuntary.

The first case was against a cardiologistand involved an alleged failure to prop-erly diagnose and treat a myocardialinfarction in a woman admitted for bilat-eral knee replacement surgery. Withinone day after surgery, the patient died ofa heart attack. Apparently, on thestrength of the Defense’s expert opinionas to both liability and causation,Plaintiff decided to settle with a co-defendant and dismiss McDonnell’sclient, but with no money contributed onhis behalf towards the settlement.

The second case was against a familypractitioner and involved an alleged fail-ure to properly diagnose and treat laryn-geal cancer. The Plaintiff, a middle-agedfemale, had treated with the Defendantfor several years, primarily for upperrespiratory infections. During the lastyear of Defendant’s treatment of her, shedeveloped an earache and dysphasia. Areferral to an ENT led to her cancer diag-nosis. Once again, this time literally onthe eve of trial, Plaintiff - who was with-out an expert opinion supporting causa-tion - voluntarily discontinued the actionwithout any payment on behalf of theDefendant.

Lastly, a trial court granted summaryjudgment in favor of an obstetrical resi-dent and hospital in a case involving atubal ligation. There, sterilization faileddue to the misidentification of the fal-lopian tube. Although the attending sur-geon remained in the case, the courtagreed that Plaintiff’s expert report wasinsufficient as to McDonnell’s clients.For additional information, please contact JeffMcDonnell at: jmcdonnell@kentmcbride.com

LEGISLATIVEUPDATE

WELL WISHES FROM K&M

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Off The Record

Everyone here at Kent & McBride would like to wish all of you

a happy and safe summer season.