J-A08026-16

 2016 PA Super 274

*Retired Senior Judge assigned to the Superior Court.

PROFESSIONAL FLOORING COMPANY, 

INC.

IN THE SUPERIOR COURT OF

PENNSYLVANIA

v.

BUSHAR CORPORATION

APPEAL OF: ROSE LINE, INC. No. 1594 EDA 2015

Appeal from the Order Entered April 21, 2015

In the Court of Common Pleas of Montgomery County

Civil Division at No(s): 05-20924

BEFORE: BOWES, OLSON and STRASSBURGER,* JJ.

OPINION BY OLSON, J.: FILED DECEMBER 06, 2016

Appellant, Rose Line, Inc., appeals from the order entered on April 21, 

2015, granting the “Motion for Order Directing Distribution of Certain Escrow 

Funds Held by Class Action Counsel,” which was filed by The Brethren Mutual 

Insurance Company (hereinafter “Brethren”). After careful consideration, we 

affirm.

A previous panel of this Court summarized some of the facts that 

underlie this appeal. We quote the well-written prior opinion and intersperse 

certain facts that are relevant only to the current appeal:

[On] May 15, 2001[, a] fire [] destroyed a commercial 

complex known as the Continental Business Center (the 

“Business Center”) located in Bridgeport, Pennsylvania. 

Over [70] commercial tenants[, including Appellant,] lost 

their businesses and hundreds of individuals suffered 

damages. . . . 

[At the time of the fire, Brethren insured Appellant under a 

business owner’s insurance policy. In accordance with the 
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insurance policy, Brethren paid Appellant a total of 

$32,502.67 for losses Appellant sustained as a result of the 

fire. 

Under the insurance policy, Brethren was subrogated to the 

rights of Appellant to “recover all or part of any payment 

[Brethren] made under th[e] policy.” Commercial 

Insurance Policy between Appellant and Brethren, from 

1/19/02 to 1/19/03, at ¶ J. Further, when Appellant 

received payment from Brethren, Appellant signed a 

subrogation receipt which declared:

[Appellant] covenants and agrees to cooperate fully with 

[Brethren] in the prosecution of all subrogation claims. . 

. . It is understood and agreed by the parties hereto 

that [Appellant] has not been fully indemnified by the 

above payment and, therefore, will seek full 

compensation of the damages sustained from third 

parties responsible therefor. The subrogation rights of 

[Brethren] are therefore subordinate to the right of 

[Appellant] to be fully indemnified from the above 

accident. [Brethren] therefore agrees not to pursue 

third-party subrogation unless and until [Appellant] has 

been fully indemnified by said third party. It is 

specifically understood and agreed by the parties hereto 

that [Brethren’s] subrogation right is subordinate to 

[Appellant’s] right to seek third-party indemnification. 

[Brethren] agrees not to enter into any settlement with 

or to receive funds from any third party tortfeasor or 

any other insurer without the prior written consent of 

[Appellant].

Subrogation Receipt for Business Income Claims, 1/4/01, at 

1; Subrogation Receipt for Business Personal Property and 

Valuable Papers and Records Claims, 1/4/01, at 1.]

On May 24, 2001, six businesses affected by the fire, 

Professional Flooring Co. (“Professional”), Limerick Carpet & 

Flooring, Inc. (“Limerick”), [Appellant], Salmons Industries, 

Inc. a/t/a Millie Switch (“Salmons”), Renu Electronics, Inc. 

(“Renu”), and Purdy–Pak, Inc. [a/k/a] Tite Pak, Inc. and PPI 

(“Purdy–Pak”), commenced a lawsuit in the Court of 

Common Pleas of Montgomery County by filing a complaint 

seeking to recover damages both on behalf of themselves 
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and similarly-situated entities and individuals sustaining 

damages in connection with the fire. The defendants 

named in this 2001 complaint included various owners, 

operators, and managers of the Business Center. After the 

pleadings were closed, the six plaintiffs filed a motion: 1) 

seeking class certification pursuant to Pa.R.C.P. 1702; 2) 

requesting to be named as class representatives; and 3) 

asking that “the law firms of Kline & Specter, P.C. and High 

Swartz Roberts & Seidel, LLP be designated as counsel for 

the class.” Memorandum Opinion and Order, 4/14/03, at 2. 

After appropriate legal analysis, the trial court granted class 

certification, designated the original six plaintiffs as the 

class representatives, and held that “Kline & Specter, P.C. 

and High, Swartz, Roberts & Seidel LLP are found to be 

adequate and are designated as class counsel.” Id. at 11. 

The court included within the class

All persons and entities who suffered losses resulting 

from the fire that started on May 15, 2001 in the 

Continental Business Center situate in Bridgeport,

Pennsylvania. Excluded from the class are defendants, 

additional defendants which may be named later, and 

their directors, officers, employees, affiliates and 

subsidiaries, as well as government entities.

Id.

The court approved of a notice to each class member about 

the pendency of the action and concerning each member’s 

ability to opt out of the class action to pursue an individual 

action for damages sustained in the fire. A packet 

describing the class action was sent to each class member 

with notice of their right to opt out of this litigation and to 

file an individual lawsuit. None of the six original plaintiffs 

elected to opt out of this action to pursue an individual 

lawsuit.

Two years later, on May 14, 2003, Professional, Limerick, 

[Appellant], Salmons, Renu, and Purdy–Pak commenced a 

separate action in the Court of Common Pleas of 

Montgomery County against various defendants who were 

involved in the development, management, control, 

maintenance, and operation of the Business Center. The 

2001 and 2003 lawsuits were then consolidated at docket 
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number 2005–20924, civil division, in the Court of Common 

Pleas of Montgomery County.

. . .

In 2006, the class representatives obtained approval to file 

an amended complaint that included other entities with 

potential liability for the fire. On July 28, 2006, the class 

representatives, on behalf of themselves and the class, filed 

a “Consolidated Amended Class Action Complaint,” adding 

more defendants. Consolidated Amended Class Action 

Complaint, 7/28/06, at 1, 2. . . . After amendment, there 

were [37] defendants included within the class action. This 

lawsuit thereafter became captioned “In re: Bridgeport Fire

Litigation.” . . .

. . .

As trial approached, [17] defendants remained in th[e class] 

action. . . . [Prior to trial, 15] defendants settled for $30 

million. The trial court preliminarily approved this 

settlement but deferred a hearing and final ruling as to that 

matter. Trial against two remaining defendants commenced 

in March 2008. During the course of trial, one of the 

defendants settled for $4 million.

Trial continued for several weeks against the sole remaining 

defendant, Universal Electric. The matter was submitted to 

the jury, and during deliberations, the jury asked a question 

that indicated that it had concluded that Universal Electric 

was not liable. At that point, despite the tenor of the jury's 

inquiry, class counsel [reached a settlement agreement 

and] obtained another $1 million from Universal Electric. 

Thus, the total settlement agreement reached with respect 

to all defendants amounted to $35 million.

Notice of the settlement was distributed to class members, 

and a fairness hearing was conducted on June 23, 2008, 

where all class members were permitted to voice objections. 

. . . 
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In re: Bridgeport Fire Litigation, 8 A.3d 1270, 1273-1274, 1276-1277, 

and 1280-1281 (Pa. Super. 2010) (internal footnotes and some internal 

citations omitted).

The trial court approved the settlement between the class and the 

settling defendants by order entered July 9, 2008. The trial court’s July 9, 

2008 order further declared:

2. This Order expressly and permanently enjoins all Class 

Members who have not validly excluded themselves from 

filing, prosecuting or continuing any related claims or 

additional lawsuits, claims or causes of action that were, 

could have been or should have been asserted by the Class 

against the Settling Defendants based upon or related to 

damages incurred in connection with the May 15, 2001 fire 

at the Continental Business Center.

. . . 

4. All Class Members having previously been afforded the 

opportunity to opt-out of the Class Action shall not be 

permitted any further opportunity to opt-out of this 

Settlement. . . . 

5. In connection with the administration of the Settlement, 

the Claims Administrator shall be required to:

a. review the claims forms and analyze the 

completeness of the information contained therein;

b. analyze all documents submitted by Class Members in 

support of their claims to ensure, among other things, 

their authenticity and completeness;

c. determine whether the individual or entity submitting 

the claim is entitled to recover funds from the 

Settlement Fund as a Class Member;
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d. process and classify the claims forms, thereafter 

tendering to Class Members the reimbursement to which 

they are entitled by and from the Settlement;

e. report the results of processing all claims to Class 

Counsel in a manner and time frame directed by Class 

Counsel; and

f. file with the [trial c]ourt a full and complete 

accounting of all funds distributed.

. . . 

7. All determinations by the Claims Administrator shall be 

final and non-appealable.

Trial Court Order, 7/9/08, at 1-2.

Following the trial court’s July 9, 2008 order, Appellant submitted a 

claim form to the court-approved Claims Administrator. Appellant’s claim 

form averred that the May 15, 2001 fire at the Continental Business Center 

caused it to suffer a total of $378,416.98 in damages. Appellant’s Claim 

Form, 8/29/08, at 1-2. Further, Brethren submitted a “subrogation interest 

form” to the Claims Administrator, asserting a subrogation lien of 

$32,503.00 from Appellant’s share of the settlement. See Letter from Class 

Counsel to Appellant, 8/18/09, at 1-2.

On August 18, 2009, class counsel wrote a letter to Appellant, 

informing Appellant:

Following a review and analysis of [Appellant’s] claim, the 

Claims Administrator has awarded [Appellant] $91,099.99 

as its net share of the settlement of the Bridgeport Fire 

Litigation, minus the asserted net subrogation lien that is 

being withheld, as explained more fully below.
J-A08026-16

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The Claims Administrator found that [Appellant’s] total 

gross loss was $135,205. The sum of all gross awards 

totaled $32,649,050. Because the total awarded was less 

than the $35,000,000 settlement amount, $2,350,950 

remained to distribute. The Claims Administrator allocated 

this additional money to all class members proportionally 

per the [trial c]ourt’s order. Each class member’s share of 

this money was based upon the ratio of their gross award in 

relation to the total amount awarded to all claimants.

The total fees and costs incurred in the prosecution and 

administration of this case totaled $13,130,930.83. . . . 

[Appellant’s] proportionate share of the fees and costs was 

determined to be $54,377.31. . . .

In addition, interest has been accruing on the settlement 

funds. . . . [Appellant’s] proportionate share of this accrued 

interest is $1,559.00. This amount will be added to its net 

share. . . . 

[Appellant’s] insurance carrier, Brethren [], has already paid 

to [Appellant] at least some of the damages it sustained in 

the fire. [Brethren] has asserted a subrogation lien for 

reimbursement of this amount, $32,503, from [Appellant’s] 

share of the settlement. It is outside the scope of 

responsibility of the Claims Administrator to determine what 

amount, if any, [Brethren] is entitled to receive. 

Accordingly, the Claims Administrator is withholding 

$19,430.81, which is the amount of the subrogation lien 

asserted less [Brethren’s] proportional share of the 

[attorneys’] fees and costs. Please contact Brethren [] to 

resolve this lien. Please understand that the Claims 

Administrator is not permitted to assist [Appellant] in this 

regard.

Enclosed is a Release. By signing the Release, [Appellant] 

agrees to accept the Claims Administrator’s award as full 

and final settlement of its claims. . . . 

Letter from Class Counsel to Appellant, 8/18/09, at 1-2.

On August 20, 2009, Appellant signed the following release:
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I, Arnold Nadler, President of [Appellant,] accept the 

amount of $91,099.99, plus $1,559.02 interest, as 

determined by the Claims Administrator, as full and final 

settlement of any and all claims arising out of the fire at the 

Continental Business Center on May 15, 2001. I understand 

that the Claims Administrator's determination is final and 

non-appealable. [Appellant,] its principals, affiliates and 

assigns, forever remise, release, discharge and waive its 

right to pursue any and all claims, objections and appeals 

relating to the Bridgeport Fire Litigation and the claims 

administration process. I understand that $19,430.81 is 

being withheld from distribution pending resolution of my 

insurance carrier's subrogation lien.

See Letter from Class Counsel to Appellant, 8/18/09, at Attached Release; 

see also In re: Bridgeport Fire Litigation, 8 A.3d at 1281. 

On April 3, 2015, Brethren filed a “Motion for Order Directing 

Distribution of Certain Escrow Funds Held by Class Action Counsel” 

(hereinafter “Brethren’s Motion for Order Directing Distribution”). Within the 

motion, Brethren claimed that it was entitled to the $19,430.81 that was 

being held in escrow, as it paid Appellant $32,503.00 for losses Appellant

sustained in the fire and it, therefore, possessed a valid subrogation lien 

over this portion of Appellant’s award. Brethren’s Motion for Order Directing 

Distribution, 4/3/15, at 1-4.

Appellant responded to Brethren’s motion and argued that Brethren 

was not entitled to the $19,430.81. According to Appellant, Brethren was 

not entitled to the funds held in escrow because Appellant had not been 

made whole by the class action payment – and Brethren was not entitled to 

subrogation unless and until Appellant had been made whole for the losses 
J-A08026-16

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Appellant sustained in the fire. Appellant’s Response to Brethren’s Motion, 

4/13/15, at 2.

On April 17, 2015, the trial court held oral argument on Brethren’s 

motion and, at the conclusion of the proceeding, the trial court granted 

Brethren’s motion. The trial court’s written order, directing class counsel to 

distribute the $19,430.81 to Brethren, was entered on April 21, 2015 and 

Appellant filed a timely notice of appeal. See Trial Court Order, 4/21/15, at 

1. Appellant raises three issues on appeal:

[1.] Whether the trial court erred in agreeing with Brethren 

that it was a third party beneficiary to a settlement release 

between Appellant [] and various third party tortfeasors 

sued in the underlying litigation[?]

[2.] Whether the trial court, in granting [Brethren’s] Motion 

for Order Directing Distribution . . . , committed an error of 

law by disregarding Pennsylvania law, the law of this case, 

and the contractual agreements of the parties in concluding 

that [Appellant] was not required to be made whole before 

Brethren was entitled to subrogation[?]

[3.] Whether the trial court erred in concluding that 

[Appellant] was made whole when the settlement payments 

it received did not cover its total loss and expenses incurred 

by [Appellant] in litigating its claims[?]

Appellant’s Brief at 2-3.1, 2

____________________________________________

1 Within the trial court’s Rule 1925(a) opinion, the court declares that 

Appellant did not serve the court reporter with notice to transcribe the April 

17, 2015 oral argument on Brethren’s motion. According to the trial court, it 

was “unable to prepare an opinion without the transcript” of the April 17, 

2015 proceeding and, therefore, all of Appellant’s issues “should be deemed 

waived” on appeal. Trial Court Opinion, 7/15/15, at 1-2. The trial court’s 

(Footnote Continued Next Page)
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Before addressing the merits of this appeal, we must address 

Brethren’s claim that Appellant waived its right to challenge the Claims 

Administrator’s “award of funds” to Brethren. According to Brethren, 

Appellant waived its right to challenge the “award of funds” because 

Appellant did not opt out of the class action settlement and Appellant 

“signed a release which expressly stated that [Appellant] accepted the 

[C]laims [A]dministrator’s award and ‘waived its right to pursue any and all 

claims . . . related to . . . the claims administration process.’” Brethren’s 

Brief at 2. Brethren’s claim fails.

The meaning of an unambiguous written instrument presents a 

question of law for resolution by the court and is subject to de novo review. 

Seven Springs Farm, Inc. v. Croker, 801 A.2d 1212, 1216 (Pa. 2002). 

When the words in a writing are unequivocal, the writing speaks for itself, 

and a meaning cannot be given to it other than that expressed. Marcinak 

v. S.E. Greene Sch. Dist., 544 A.2d 1025, 1027-1028 (Pa. Super. 1988), 

(Footnote Continued) _______________________

reasoning is mistaken, given that the April 17, 2015 proceeding on 

Brethren’s motion constituted an oral argument and not a hearing; and, 

since the parties did not present any evidence during the April 17, 2015 oral 

argument, the trial court should not have needed a transcript to prepare a 

proper Rule 1925(a) opinion. Further, we note that the April 17, 2015 oral 

argument transcript is included in the certified record that was forwarded to 

this Court.

2

For ease of discussion, we have re-numbered Appellant’s claims on appeal.
J-A08026-16

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quoting E. Crossroads Ctr., Inc. v. Mellon-Stuart Co., 205 A.2d 865 (Pa. 

1965).

Moreover, principles of contract law govern the interpretation and 

applicability of settlement agreements. See Pennsbury Vill. Assocs., LLC. 

v. McIntyre, 11 A.3d 906, 914 (Pa. 2011). Questions of contract 

interpretation are matters of law that we review de novo. Tuscarora 

Wayne Mut. Ins. Co. v. Kadlubosky, 889 A.2d 557, 560 (Pa. Super. 

2005). A court determines the effect of a release from its language, and we 

give language its ordinary meaning unless the parties clearly intended a 

different meaning. In re Estate of Bodnar, 372 A.2d 746, 748 (Pa. 1977). 

“A release ordinarily covers only such matters as can fairly be said to have 

been within the contemplation of the parties when the release was given.” 

Id. We must read portions of contractual language interdependently, 

considering their combined effects in the totality of the document. 

Trombetta v. Raymond James Fin. Servs., 907 A.2d 550, 560 (Pa. 

Super. 2006). Additionally, “specific language controls the general.” Id.

As Brethren notes, the trial court’s July 9, 2008 order approved the 

class settlement and declared:

5. In connection with the administration of the Settlement, 

the Claims Administrator shall be required to:

a. review the claims forms and analyze the 

completeness of the information contained therein;
J-A08026-16

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b. analyze all documents submitted by Class Members in 

support of their claims to ensure, among other things, 

their authenticity and completeness;

c. determine whether the individual or entity submitting 

the claim is entitled to recover funds from the 

Settlement Fund as a Class Member;

d. process and classify the claims forms, thereafter 

tendering to Class Members the reimbursement to which 

they are entitled by and from the Settlement;

e. report the results of processing all claims to Class 

Counsel in a manner and time frame directed by Class 

Counsel; and

f. file with the [trial c]ourt a full and complete 

accounting of all funds distributed.

. . . 

7. All determinations by the Claims Administrator shall be 

final and non-appealable.

Trial Court Order, 7/9/08, at 1-2.

Further, on August 20, 2009, Appellant signed the following release:

I, Arnold Nadler, President of [Appellant] accept the amount 

of $91,099.99, plus $1,559.02 interest, as determined by 

the Claims Administrator, as full and final settlement of any 

and all claims arising out of the fire at the Continental 

Business Center on May 15, 2001. I understand that the 

Claims Administrator's determination is final and nonappealable. [Appellant,] its principals, affiliates and assigns, 

forever remise, release, discharge and waive its right to 

pursue any and all claims, objections and appeals relating to 

the Bridgeport Fire Litigation and the claims administration 

process. I understand that $19,430.81 is being withheld 

from distribution pending resolution of my insurance 

carrier's subrogation lien.
J-A08026-16

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See Letter from Class Counsel to Appellant, 8/18/09, at Attached Release; 

see also In re: Bridgeport Fire Litigation, 8 A.3d at 1281.

According to Brethren, since Appellant did not opt out of the class, it 

was bound by the trial court’s July 9, 2008 order that “[a]ll determinations 

by the Claims Administrator [are] final and non-appealable.” See Brethren’s 

Brief at 5 and 8; see also Trial Court Order, 7/9/08, at 1-2. Moreover, 

since Appellant signed the release, Appellant agreed to “forever remise, 

release, discharge and waive its right to pursue any and all claims,

objections and appeals relating to the Bridgeport Fire Litigation and the 

claims administration process” – including, Brethren claims, the Claims 

Administrator’s “award” of $19,430.81 to Brethren. See Brethren’s Brief at 

8-9; see also Letter from Class Counsel to Appellant, 8/18/09, at Attached 

Release; see also In re: Bridgeport Fire Litigation, 8 A.3d at 1281.

Brethren’s argument on appeal fails because, under the plain terms of 

the release, the Claims Administrator did not “award” Brethren the 

$19,430.81. Instead, the Claims Administrator “withheld” the $19,430.81 

from distribution “pending resolution of [Brethren’s] subrogation lien.” 

Letter from Class Counsel to Appellant, 8/18/09, at Attached Release 

(emphasis added); see also In re: Bridgeport Fire Litigation, 8 A.3d at 

1281. The wording of this release expressly contemplates a subsequent 

resolution of Brethren’s subrogation claim through some independent 

proceeding – and thus contradicts Brethren’s position that the Claims 

Administrator had made a “determination[]” on Brethren’s subrogation 
J-A08026-16

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claim. See Letter from Class Counsel to Appellant, 8/18/09, at Attached 

Release; see also In re: Bridgeport Fire Litigation, 8 A.3d at 1281.

Therefore, under the plain terms of the release, the Claims 

Administrator did not make a “determination[]” on the propriety of 

Brethren’s subrogation claim and the release expressly contemplated that 

future proceedings would occur, outside of the claims administration 

process, to determine Brethren’s subrogation claim. As such, Brethren’s 

argument that the Claims Administrator made a final and non-appealable 

award of its entire subrogation claim by placing the value of the asserted 

claim in escrow is unavailing. We now proceed to determine Appellant’s 

issues on appeal.

Appellant’s first numbered issue on appeal declares that “the trial court 

erred in agreeing with Brethren that it was a third party beneficiary to a 

settlement release between Appellant [] and various third party tortfeasors 

sued in the underlying litigation” and that “the settlement release did not 

prevent [Appellant] from contesting Brethren’s lien.” Appellant’s Brief at 

34-36. We have determined that the Claims Administrator did not make a 

final determination regarding Brethren’s subrogation claim. Therefore, we 

need not discuss Appellant’s first numbered claim further.

Appellant’s remaining issues on appeal are essentially singular and 

may be summarized as follows: the trial court erred in concluding that 

Appellant’s acceptance of its share of the class action settlement made 

Appellant “whole” for the losses it sustained as a result of the May 15, 2001 
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fire. Further, Appellant claims that, since it was not made whole, Brethren

was not entitled to subrogation and the trial court erred in distributing funds 

to Brethren.

Our Supreme Court has explained the equitable doctrine of 

subrogation as follows:

[the Pennsylvania Supreme Court has] repeatedly held that 

subrogation is an equitable doctrine intended to place the 

ultimate burden of a debt upon the party primarily 

responsible for the loss. Subrogation allows the subrogee 

(in this case the insurer) to step into the shoes of the 

subrogor (the insured) to recover from the party that is 

primarily liable (the third party tortfeasor) any amounts 

previously paid by the subrogee to the subrogor. . . . As 

well-stated by the Superior Court,

[W]hen an individual who has been indemnified for a 

loss subsequently recovers for the same loss from a 

third party, equity compels that the indemnifying party 

be restored that which he paid the injured party; 

thereby placing the cost of the injury upon the party 

causing the harm while preventing the injured party 

from profiting a “double recovery” at the indemnifying 

party’s expense.

Jones v. Nationwide Prop. & Cas. Ins. Co., 32 A.3d 1261, 1270-1271 

(Pa. 2011) (some internal citations omitted), quoting Allstate Ins. Co. v. 

Clarke, 527 A.2d 1021, 1024 (Pa. Super. 1987). 

Subrogation rights may arise by contract or by operation of law, but 

those rights are always subject to considerations of equity and good 

conscience. Jones, 32 A.3d at 1271. The underlying principle “is that the 

burden of loss should rest on the party paid to assume the risk, and not on 

an inadequately compensated insured, who is least able to shoulder the 
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loss.” Id.; accord Wimer v. Pa. Employees Benefit Trust Fund, 939 

A.2d 843, 853 (Pa. 2007) (subrogation is enforced to bring about substantial 

justice, by placing the burden of a debt on the party who in good conscience 

should pay it). Furthermore, “subrogation is not an inflexible legal concept” 

but an exercise of equitable powers, and a court is to enforce subrogation 

interests with “a proper equitable discretion” and “with a due regard for the 

legal and equitable rights of others.” Daley-Sand v. W. Am. Ins. Co., 564 

A.2d 965, 970 (Pa. Super. 1989).

To give effect to these equitable principles, the “made whole” doctrine 

requires that an insured recover the full amount of its losses before an 

insurer may pursue recovery under its subrogation rights. Heller v. Pa. 

League of Cities & Municipalities, 32 A.3d 1213, 1219 n.12 (Pa. 2011). 

Turning now to that doctrine,

COUCH ON INSURANCE describes the made whole doctrine as 

follows: “where an insured is entitled to receive recovery for 

the same loss from more than one source, e.g. the insurer 

and the tortfeasor, it is only after the insured has been fully 

compensated for all the loss that the insurer acquires a right 

to subrogation, or is entitled to enforce its subrogation 

rights.” 16 COUCH ON INSURANCE § 223:134 (3d Ed.) 

(footnote omitted). Our courts have explained that the 

made whole doctrine both ensures that the insured is fully 

compensated for his or her injury before the insurer 

recovers, in cases where there are insufficient funds to 

satisfy both the insured and the insurer, and prevents the 

insured from receiving dual recovery for the same loss from 

both the tortfeasor and the insurer.

Jones, 32 A.3d at 1271 (some citations omitted).
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The “made whole” doctrine is controlling law in Pennsylvania. Id. at 

1267 n.5 (“Pennsylvania has applied the ‘made whole’ doctrine repeatedly”). 

As applied in this Commonwealth, “equity will not allow the subrogee’s claim 

to be placed ahead of the subrogor’s.” Daley-Sand, 564 A.2d at 970. 

In the instant case, Brethren agreed to subordinate any subrogation 

claim to Appellant’s full recovery by an express term in two subrogation 

receipts, which read:

[Appellant] covenants and agrees to cooperate fully with 

said Insurance Company [Brethren] in the prosecution of all 

subrogation claims, and to procure and furnish all papers 

and documents necessary in such proceedings and to attend 

court and testify if [Brethren] deems such to be necessary, 

but it is understood that [Appellant] is to be saved harmless 

from costs in such proceedings. It is understood and 

agreed by the parties hereto that [Appellant] has not been 

fully indemnified by the above payment and, therefore, will 

seek full compensation of the damages sustained from third 

parties responsible therefor. The subrogation rights of 

[Brethren] are therefore subordinate to the right of 

[Appellant] to be fully indemnified from the above accident. 

[Brethren] therefore agrees not to pursue third-party 

subrogation unless and until [Appellant] has been fully 

indemnified by said third party. It is specifically understood 

and agreed by the parties hereto that [Brethren’s] 

subrogation right is subordinate to [Appellant’s] right to 

seek third-party indemnification. [Brethren] agrees not to 

enter into any settlement with or to receive funds from any 

third party tortfeasor or any other insurer without the prior 

written consent of [Appellant].

Subrogation Receipt for Business Income Claims, 1/4/01, at 1; Subrogation 

Receipt for Business Personal Property and Valuable Papers and Records 

Claims, 1/4/01, at 1. 
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In this case, the “made whole” limitation on Brethren’s subrogation 

interest thus arises both from an express, contractual declaration and by 

implication under the common law, as a matter of equity and public policy. 

See AAA Mid-Atlantic Ins. Co. v. Ryan, 84 A.3d 626, 634 (Pa. 2014); 

Cerankowski v. State Farm Mut. Auto. Ins. Co., 783 A.2d 343, 347-348 

(Pa. Super. 2001). For these reasons, the “made whole” doctrine is 

controlling law in this case, and it requires that Appellant recoup the full 

value of its losses before Brethren may recover. See Heller, 32 A.3d at 

1219 n.12.

The question on appeal is whether Appellant has been “made whole” 

by accepting its disbursement from the class settlement. With respect to 

this issue, Appellant does not question the validity of the settlement, its 

gross allocation from the settlement fund, or the process by which the 

Claims Administrator made its allocation. Appellant’s Brief at 27-28. 

Nevertheless, Appellant contends that the disbursement did not fully 

compensate it for its losses because: 1) Appellant claimed that it suffered 

$378,416.98 in losses from the fire, but the Claims Administrator only 

conferred upon Appellant a gross award of $145,477.30 (plus interest)3and 

____________________________________________

3 Within Appellant’s brief to this Court, Appellant declares that the Claims 

Administrator “awarded [Appellant] $135,205 out of the $35 million 

settlement fund.” Appellant’s Brief at 5. Appellant is incorrect. As class 

counsel’s letter to Appellant declares:

(Footnote Continued Next Page)
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(Footnote Continued) _______________________

Following a review and analysis of [Appellant’s] claim, the 

Claims Administrator has awarded [Appellant] $91,099.99 

as its net share of the settlement of the Bridgeport Fire 

Litigation, minus the asserted net subrogation lien that is 

being withheld, as explained more fully below.

The Claims Administrator found that [Appellant’s] total 

gross loss was $135,205. The sum of all gross awards 

totaled $32,649,050. Because the total awarded was less 

than the $35,000,000 settlement amount, $2,350,950 

remained to distribute. The Claims Administrator allocated 

this additional money to all class members proportionally 

per the [trial c]ourt’s order. Each class member’s share of 

this money was based upon the ratio of their gross award in 

relation to the total amount awarded to all claimants.

The total fees and costs incurred in the prosecution and 

administration of this case totaled $13,130,930.83. . . . 

[Appellant’s] proportionate share of the fees and costs was 

determined to be $54,377.31. . . .

In addition, interest has been accruing on the settlement 

funds. . . . [Appellant’s] proportionate share of this accrued 

interest is $1,559.00. This amount will be added to its net 

share. . . .

Letter from Class Counsel to Appellant, 8/18/09, at 1-2.

Further, the release declares that Appellant “accept[ed] the amount of 

$91,099.99, plus $1,559.02 interest, as determined by the Claims 

Administrator, as full and final settlement of any and all claims arising out 

the fire at the Continental Business Center on May 15, 2001.” See Letter 

from Class Counsel to Appellant, 8/18/09, at Attached Release; see also In 

re: Bridgeport Fire Litigation, 8 A.3d at 1281.

As the letter from class counsel makes clear, the Claims Administrator 

determined that Appellant suffered a total gross loss of $135,205.00. 

However, since the “sum of all gross awards totaled $32,649,050” – and the 

total amount of the settlement was $35,000,000.00 – the Claims 

Administrator still needed to award the additional $2,350,950.00 to the 

class. The Claims Administrator did so by “allocat[ing the $2,350,950.00] . . 

(Footnote Continued Next Page)
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2) even if the gross award established Appellant’s total loss, Brethren is still 

not entitled to subrogation because “[t]he fees and costs assessed to 

[Appellant] by the [Claims] Administrator far exceeded” the insurance 

payment. Appellant’s Brief at 26-34. Both of Appellant’s claims fail.

The Pennsylvania Supreme Court has held that, for subrogation 

purposes, where an insured brings suit against a tortfeasor for his “whole 

loss,” “the verdict must be considered as representing the whole loss.” 

Stoughton v. Mfr.’s Natural Gas Co., 30 A. 1001 (Pa. 1895); see also 

Gallop v. Rose, 616 A.2d 1027, 1031 (Pa. Super. 1992) (“[t]hus, [the 

insurer] had no equitable right to subrogation until [the insured’s] total 

damages were ascertained and recouped, a condition precedent met when 

the jury returned a verdict of $100,000.00”) (internal emphasis omitted). In 

other words, where an insured sues his tortfeasor for the entirety of his loss 

(Footnote Continued) _______________________

. to all class members proportionally per the [trial c]ourt’s order.” Letter 

from Class Counsel to Appellant, 8/18/09, at 1-2. The additional amount 

allocated to Appellant from the remaining $2,350,950.00 was $10,272.30. 

See [$91,099.99subnote.a – ($135,205.00subnote.b – $54,377.31subnote.c) = 

$10,272.30]. Thus, the Claims Administrator provided Appellant with a total 

gross award of $145,477.30 (plus interest). See [$135,205.00 + 

$10,272.30 = $145,477.30].

subnote.a. $91,099.99 constitutes Appellant’s net share of the entire 

settlement.

subnote.b. $135,205.00 constitutes Appellant’s total gross loss.

subnote.c. $54,377.31 constitutes the attorneys’ fees and costs 

attributable to Appellant’s gross share of the entire settlement.
J-A08026-16

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and then receives a verdict or a decision in his favor, the amount of the 

recovery, ipso facto, fully compensates the insured for his losses. Further, 

since the insured is “made whole” and fully compensated by the verdict, the 

indemnifying insurer is entitled to enforce its subrogation rights on the 

recovery – so as to “prevent the insured from receiving dual recovery for the 

same loss from both the tortfeasor and the insurer.” See Jones, 32 A.3d at 

1271

In the case at bar, Appellant was a class member in the underlying 

action and, following the $35,000,000.00 class settlement, the trial court 

ordered Appellant to participate in a claims process whereby the Claims 

Administrator would: review Appellant’s claims of loss; analyze the 

documents supporting Appellant’s loss claims to ensure “their authenticity 

and completeness;” and, determine whether and in what amount Appellant 

was entitled to recover from the settlement fund. Trial Court Order, 7/9/08, 

at 1-2. Appellant then submitted a claim to the Claims Administrator, 

averring that it suffered a total of $378,416.98 in damages from the fire. 

Appellant’s Claim Form, 8/29/08, at 1-2. Further, when Appellant submitted 

its claim, it knew that “[a]ll determinations by the Claims Administrator shall 

be final and non-appealable.” Trial Court Order, 7/9/08, at 1-2.

After reviewing Appellant’s claim and supporting documents, the 

Claims Administrator came to the factual determination that Appellant’s 

“total gross loss [from the fire] was $135,205.” Letter from Class Counsel 

to Appellant, 8/18/09, at 1-2. Further, the Claims Administrator arrived at 
J-A08026-16

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the factual determination that Appellant’s total losses were $135,205.00 –

and not $378,416.98 – even though the Claims Administrator was not 

constrained by the total settlement amount. To be sure, the Claims 

Administrator concluded that the sum of all gross awards from the class was 

$32,649,050.00 – which was $2,350,950.00 less than the total settlement 

amount. Letter from Class Counsel to Appellant, 8/18/09, at 1-2. As such, 

had the Claims Administrator believed that Appellant’s total gross loss 

exceeded $135,205.00, the Claims Administrator possessed sufficient 

additional funds to compensate Appellant for the hypothetical, additional 

loss. 

In this case, Appellant was operating under a court-ordered claims 

process where Appellant sought to recover its entire loss from the fire and 

where a court-approved Claims Administrator arrived at a factual 

determination that Appellant’s total gross loss from the fire was 

$135,205.00. Appellant’s total loss has thus been ascertained, by the 

factfinder, to be $135,205.00. 

We see no reason to treat this situation any differently than where an 

insured sues his tortfeasor for the entirety of his loss and then receives a 

verdict or a decision in his favor. In either case (whether determined by a 

Claims Administrator under a court-ordered claims process or by a 

factfinder’s verdict or decision following trial), there has been a legally 

binding determination that the insured suffered a certain, monetary amount 

of damages – which “must be considered as representing the whole loss.” 
J-A08026-16

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Stoughton, 30 A. at 1001. As such, in accordance with our Supreme 

Court’s precedent, we conclude that the trial court did not err when it held 

that the Claims Administrator’s determination in this case “must be 

considered as representing [Appellant’s] whole loss.” Stoughton, 30 A. at 

1001.4, 5 Appellant’s claim to the contrary fails.

____________________________________________

4 Certainly, since the Claims Administrator determined that Appellant’s total 

gross loss from the fire was $135,205.00 (plus interest) and the Claims 

Administrator ultimately declared that Appellant was entitled to a total gross 

award of $145,477.30 (plus interest), it is apparent that Appellant was 

more than fully compensated for its losses in this case. 

5 We hold that, in this case, the Claims Administrator’s factual assessment of 

Appellant’s total loss is akin to a factfinder’s verdict or decision following 

trial. See Stoughton, 30 A. at 1001. Nevertheless, we also note that 

Pennsylvania courts have held that, “when a subrogor settles instead of 

pressing his suit against an alleged tortfeasor to verdict, he cannot defeat a 

subrogee’s claim by asserting that his loss exceeded the settlement 

recovery” and that “[w]hen a subrogor settles, he waives his right to a 

judicial determination of his losses, and conclusively establishes the 

settlement amount as full compensation for his damages.” See Associated 

Hosp. Serv. of Phila. v. Pustilnik, 396 A.2d 1332, 1337-1338 (Pa. Super. 

1979), vacated on other grounds, 439 A.2d 1149 (Pa. 1981). Further, 

although our opinion in Pustilnik was vacated by the Pennsylvania Supreme 

Court on other grounds, the principle espoused in Pustilnik stemmed from 

our Supreme Court’s opinion in Illinois Automobile Insurance Exchange 

v. Braun, 124 A. 691 (Pa. 1924), where, following settlement with the 

tortfeasor, the insureds claimed that they were not made whole because 

their losses exceeded the settlement amount. The Braun Court held: 

“[w]hile it is true the amount claimed from the [tortfeasor] was greater than 

the total [the insureds] received from [both the tortfeasor and insurer], 

the[] [insureds] did not test out what their full loss was by pressing the suit 

against the [tortfeasor] to verdict, and therefore cannot avail themselves of 

the principle they seek to invoke. . . . It would never do in administering 

such an equitable doctrine as subrogation to permit the insured to defeat 

recovery of any sum from him by his insurer merely by making claim as to 

his total loss without having his loss ascertained.” Id. at 693. Moreover, we 

(Footnote Continued Next Page)
J-A08026-16

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Finally, Appellant claims that, even if the gross award established 

Appellant’s total loss, Brethren is still not entitled to subrogation because 

“[t]he fees and costs assessed to [Appellant] by the [Claims] Administrator 

far exceeded” the insurance payment. Appellant’s Brief at 26-34. This claim 

fails.

At the outset, Appellant has cited no binding precedent that would 

support its claim that it is not responsible for the attorneys’ fees and costs 

that were necessary to produce the class settlement and Appellant’s own 

recovery from the tortfeasors.6 Moreover, we conclude that Appellant’s 

proposed rule of law would be inequitable and would permit Appellant double 

recovery. See Daley-Sand, 564 A.2d at 969-970 (“[s]ubrogation is an 

equitable principle. . . . Thus, whatever the contractual language regarding 

(Footnote Continued) _______________________

note that, although the Supreme Court vacated our opinion in Pustilnik on 

other grounds, the Supreme Court appeared to agree with our holding in 

Pustilnik that the settlement amount constitutes “full compensation” for an 

insured’s damages. See Associated Hosp. Serv. of Phila. v. Pustilnik, 

439 A.2d 1149 (Pa. 1981) (vacating the Superior Court opinion, but 

rejecting the insured’s claim that the Superior Court erred “in refusing to 

reduce Blue Cross’s recovery by 50% to reflect the ‘doubtfulness’ of [the 

insured’s] claim against [the tortfeasor], as the trial court had done;” the 

Supreme Court held: “[the insured’s] contention was properly rejected as 

meritless by the Superior Court, see Illinois Automobile Insurance 

Exchange v. Braun, 124 A. 691 (Pa. 1924), and does not warrant further 

discussion”); see also Allstate Ins. Co. v. Clarke, 527 A.2d 1021, 1023 

(Pa. Super. 1987) (stated in dicta).

6 To support its claim, Appellant has cited to two non-binding opinions from 

the courts of common pleas. See Nationwide Mut. Ins. Co. v. Butler, 28 

Pa. D. & C. 3d 627 (Westmoreland Cty. 1983); Nationwide Mut. Ins. Co. 

v. Kintz, 27 Pa. D. & C. 3d 164 (Cumberland Cty. 1983).
J-A08026-16

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subrogation, the equitable nature of subrogation is not altered”); Clarke, 

527 A.2d at 1024 (subrogation is intended to “prevent[] the injured party 

from profiting a ‘double recovery’ at the indemnifying party’s expense”).

The class in this case was defined as:

All persons and entities who suffered losses resulting from 

the fire that started on May 15, 2001 in the Continental 

Business Center situate in Bridgeport, Pennsylvania. 

Excluded from the class are defendants, additional 

defendants which may be named later, and their directors, 

officers, employees, affiliates and subsidiaries, as well as 

government entities.

In re: Bridgeport Fire Litigation, 8 A.3d at 1274.

Both Appellant and Brethren “suffered losses resulting from the [May 

15, 2001] fire,” since Appellant suffered its losses directly from the fire and 

Brethren suffered a monetary loss when it paid Appellant for the insured

damages under the policy. Thus, contrary to Appellant’s claims in its reply 

brief, both Appellant and Brethren were members of the same class. See 

also Trial Court Order, 9/22/04, at 1 (granting Appellant’s petition to strike 

Brethren’s opt-out of the class); Trial Court Opinion, 12/9/04, at 1-14.7

Given that both Appellant and Brethren were part of the same class, 

both Appellant and Brethren benefitted from class counsel’s work (and 

____________________________________________

7 Not only does Brethren meet the class definition, but the trial court struck 

Brethren’s attempt to opt-out of the class after Appellant opposed the effort. 

Trial Court Order, 9/22/04, at 1 (granting Appellant’s petition to strike 

Brethren’s opt-out of the class); Trial Court Opinion, 12/9/04, at 1-14.
J-A08026-16

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associated costs) in creating the $35,000,000.00 common fund – and in

creating the total gross award of $145,477.30 (plus interest) to Appellant, 

subject to Brethren’s subrogation lien $32,503.00. See Estate of 

Wanamaker, 460 A.2d 824, 825 (Pa. Super. 1983) (“[A] litigant or a lawyer 

who recovers a common fund for the benefit of persons other than himself 

or his client is entitled to a reasonable attorney’s fee from the fund as a 

whole. . . . The common-fund doctrine reflects the traditional practice in 

courts of equity . . . and it stands as a well-recognized exception to the 

general principle that requires every litigant to bear his own attorney’s fees. 

. . . The doctrine rests on the perception that persons who obtain the 

benefit of a lawsuit without contributing to its cost are unjustly enriched at 

the successful litigant’s expense”) (quoting The Boeing Co. v. Van 

Gemert, 444 U.S. 472 (1980)). As such, the only equitable result was for 

Appellant and Brethren to pay a pro rata share of the attorneys’ fees and 

costs.8 Certainly, any other holding would necessarily result in Brethren 

____________________________________________

8 As noted, the Claims Administrator conferred upon Appellant a total gross 

award of $145,477.30 (plus interest) and Brethren asserted a total 

subrogation lien of $32,503.00 from this share. Thus, after subtracting 

Brethren’s lien, Appellant’s gross share was $112,974.30 (plus interest). In 

ordering the net distribution of $19,430.81 to Brethren, the trial court 

required that both Brethren and Appellant bear their proportional share of 

the attorneys’ fees and costs that were attributable to the total gross award. 

Thus, of the $54,377.31 in attorneys’ fees and costs attributable to the total 

gross award of $145,477.30, Brethren paid $13,072.19 (which is 

approximately 40% of its $32,503.00 gross share in attorneys’ fees and 

costs) and Appellant paid $41,305.12 (which is approximately 36% of its 

$112,974.30 gross share in attorneys’ fees and costs).
J-A08026-16

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paying Appellant’s share of the attorneys’ fees and costs that were 

necessary to obtain the class settlement and Appellant’s own gross award –

which Brethren was neither statutorily nor contractually obliged to do. This 

would, by definition, permit Appellant double recovery at the expense of the 

indemnifying insurer and, thus, run contrary to the equitable principles that 

underlie the doctrine of subrogation.

Therefore, since the equitable result required that Appellant and 

Brethren pay their pro rata shares of the attorneys’ fees and costs – and 

since “[s]ubrogation is an equitable principle” – we conclude that the trial 

court properly rejected Appellant’s claim that it was not made whole because 

“[t]he fees and costs assessed to [Appellant] by the [Claims] Administrator 

far exceeded” the insurance payment. 

Judgment affirmed. Jurisdiction relinquished.

Bowes, J., joins this Opinion.

Strassburger, J., files a Dissenting Opinion.

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 12/6/2016
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