Court Opinion

ID: 9647848
Source: CourtListenerOpinion
Date Created: 2023-08-23 13:52:54.264592+00
Date Added: 2024-06-11T18:11:54.206737
License: Public Domain

WIEAND, Judge,
dissenting.
The majority holds that a policy of automobile insurance providing coverage for first party benefits under the Motor *197Vehicle Financial Responsibility Law1 may be specifically enforced in equity. I dissent. I would hold that an action at law to recover money damages as provided by the statute is an adequate remedy. I also dissent from the majority’s holding that an insurance company which, in reliance upon a physical examination made by a competent physician, has discontinued the payment of first party benefits can, without more, be made to pay the claimant’s counsel fees in a subsequent action to recover benefits.
David Hill sustained personal injuries as a result of a motor vehicle accident on July 27, 1985. Nationwide Insurance Company (Nationwide) paid first party medical benefits for the first year thereafter and up to September 24, 1986, when it discontinued further payments. Its decision to deny further payments was based upon independent physical examinations conducted by Dr. Frances Bryan, an internist, and Dr. Richard Schmidt, an orthopedic surgeon. Dr. Bryan found no physical reason that would prevent Hill from working and recommended a home exercise program. Dr. Schmidt found no residual effects of the accident and opined that there was no need for Hill to receive further medical treatments. When Hill’s claim for continuing benefits was denied, he filed an action in equity to compel Nationwide’s continued payment of medical benefits. The insurance company moved to transfer the action to the law side of the court where a factual determination of Hill’s need for continuing medical treatment could be made by a jury. The trial court denied Nationwide’s motion on grounds that the insurer’s denial of liability was subject to repetition which might require multiple additional actions. After trial without a jury, at which conflicting testimony was presented regarding Hill’s recovery from his injuries, the trial court entered a decree nisi in which Nationwide was directed to pay accumulated medical bills in the amount of $12,849.79, together with interest at the rate of 12% and counsel fees in the amount of $5,687.50. The insurer was also directed to “continue to pay medical and medically *198related bills ... as shall be submitted ... for payment until further Order of this Court, subject to policy limits as to amount of insurance coverage.” The trial court added in its adjudication that it would “direct independent medical examinations both of an orthopedic and psychiatric nature, said examiners to be appointed by the Court, at intervals of no less than six months, or for a shorter time on petition of a party and for good cause shown, to determine the need for continued medical and/or psychiatric or psychological treatment____” A motion for post-trial relief was denied, and the decree nisi was entered as the final decree of the court. Nationwide appealed.
“It is axiomatic that in order for a Court to grant equitable relief to redress the violation of a legal right, the remedy at law must be inadequate.” Robinson v. Abington Education Association, 492 Pa. 218, 223, 423 A.2d 1014, 1016 (1980). Moreover, “[i]t is generally established that where a remedy is provided by statute, the jurisdiction of a court of equity may not be invoked since there is an adequate remedy at law.” Peitzman v. Seidman, 285 Pa.Super. 228, 231, 427 A.2d 196, 198 (1981). See: DeLuca v. Buckeye Coal Company, 463 Pa. 513, 519, 345 A,2d 637, 640 (1975). “When a statute provides a remedy by which a right may be enforced, no other remedy than that afforded by the statute can be used.” Pennsylvania State Chamber of Commerce v. Torquato, 386 Pa. 306, 329, 125 A.2d 755, 766 (1956), cert. denied sub nom. Bouman v. Pennsylvania State Chamber of Commerce, 352 U.S. 1024, 77 S.Ct. 589, 1 L.Ed.2d 596 (1957), quoting Collegeville v. Philadelphia Suburban Water Co., 377 Pa. 636, 645, 105 A.2d 722, 726 (1954). In such cases, equity will grant relief only if the statutory remedy is not adequate or its pursuit would work irreparable harm. Pennsylvania State Chamber of Commerce v. Torquato, supra 386 Pa. at 329, 125 A.2d at 766; Collegeville v. Philadelphia Suburban Water Co., supra 377 Pa. at 646, 105 A.2d at 726; Duquesne Light Company v. Upper St. Clair Township, 377 Pa. 323, 340, 105 A.2d 287, 294-295 (1954). A claim for money damages *199is ordinarily cognizable at law, not in equity. Central Storage & Transfer Co. v. Kaplan, 37 Pa.Commw. 105, 112, 389 A.2d 711, 715 (1978), aff'd, 487 Pa. 485, 410 A.2d 292 (1979). See: Bauer v. P.A. Cutri Co. of Bradford, Inc., 434 Pa. 305, 253 A.2d 252 (1969).
In this action the claimant sought to recover money damages representing first party benefits under the Motor Vehicle Financial Responsibility Law. An action at law is an adequate remedy to recover such moneys. Moreover, a claim for first party benefits is controlled by the statute. If benefits are not paid within thirty (30) days, they bear interest at the rate of 12% per annum from the date they become due. 75 Pa.C.S. § 1716. If the denial of benefits is unreasonable, the insurer is required to pay, in addition, “a reasonable attorney fee based upon actual time expended.” Id. These provisions contemplate an action at law for money damages. The remedy at law, in view of the penalties imposed by the statute for failure to make payment when due, is clearly adequate. The statute does not envision and the courts should not create a remedy which requires courts of equity to supervise insurance companies in the performance of their duties under MVFRL. It is an adequate remedy that defaulting insurance companies will be required to pay to the claimant interest at the rate of 12% and, if their default has been unreasonable, a counsel fee as well.
The majority, although conceding that an action at law is an adequate remedy to recover money damages, allows an action in equity for specific performance because Nationwide may refuse to make future payments, in which event Hill will be required to institute multiple actions to enforce his rights. I do not find this argument persuasive. In the first place, the record does not support a finding that Nationwide will in the future refuse to comply with the duties imposed upon it by MVFRL and the provisions of its policy of automobile insurance. It is sheer speculation to conclude from this record that multiple actions will be required to enforce Hill’s claim for first party benefits. In *200the absence of evidence to support such a finding, the claimant must be held to have failed in his burden of showing the need for a court of equity to assume jurisdiction. Equitable jurisdiction does not exist to protect against mere possibilities. Jones v. Amsel, 388 Pa. 47, 52-53, 130 A.2d 119, 122 (1957); Philadelphia Assoc. of School Administrators v. School Dist. of Phila., 80 Pa.Commw. 242, 246-247, 471 A.2d 581, 584 (1984), citing Robinson v. Philadelphia, 400 Pa. 80, 89, 161 A.2d 1, 6 (1960).
The dispute between insurer and insured in this case arose because independent examinations of the insured by competent physicians disclosed that continuing medical treatment was unnecessary. If these medical opinions are incorrect, as the trial court has found, there is no reason to believe that Nationwide will refuse to make payment of first party benefits as and when they become due. In the event it fails to do so, however, the legislature has provided an adequate remedy. If payments are not made when due, the insurer will become liable for interest at the rate of 12%; and if the default is unreasonable, the insurer will be required to reimburse the claimant for any counsel fees incurred in collecting moneys which Nationwide wrongfully refused to pay.
The recovery of damages, plus interest and counsel fees, is not only an adequate remedy but also one which is more efficient and less wasteful of judicial resources than a remedy in equity which requires the court to monitor a claimant’s physical condition by multiple examinations of the claimant by court appointed physicians. The majority's decision to allow equitable jurisdiction for the purpose of decreeing specific performance of policies of automobile insurance issued under the Motor Vehicle Financial Responsibility Law establishes an unfortunate precedent. It will undoubtedly increase the number of actions brought in equity to enforce policies of insurance by calling upon the contempt powers of the court. It will also provide precedent for removing to courts of equity many disputes which are now heard by juries in courts of law. In my judgment, this is unnecessary. Where the only dispute between claim*201ant and insurer is whether the claimant has recovered from injuries received in a vehicular accident, the dispute is better resolved at law. Because this is an adequate remedy, I submit, a court of equity lacks jurisdiction to grant specific performance.
“In the event an insurer is found to have acted with no reasonable foundation in refusing to pay the benefits enumerated ... when due, the insurer shall pay, in addition to the benefits owed and the interest thereon, a reasonable attorney fee based upon actual time expended.” 75 Pa.C.S. § 1798(b). See also: 75 Pa.C.S. § 1716. In effect, this statutory provision has been interpreted as a penalty intended to deter bad faith conduct. DeMichele v. Erie Insurance Exchange, 385 Pa.Super. 634, 636-7, 561 A.2d 1271, 1273-1274 (1989). See: Hayes v. Erie Insurance Exchange, 493 Pa. 150, 160, 425 A.2d 419, 424 (1981).
In the instant case, the insurer discontinued the payment of first party benefits after fourteen months because the claimant was found to have recovered from his injuries by two competent physicians employed to examine him. The trial court, after hearing medical testimony from experts employed by both sides, found the claimant’s witnesses more credible and held that claimant was entitled to continuing benefits. With no other basis therefor than its own determination of credibility, the trial court found that the insurer had acted in bad faith and awarded to claimant a counsel fee of $5,687.50. The majority affirms. I dissent. I conclude that the trial court’s finding of bad faith is unsupported by the evidence. Therefore, I would reverse the award of counsel fees.
Provision is made in 75 Pa.C.S. § 1796(a) for the physical examination of a claimant whose physical condition is material to his claim for benefits. When an insurer obtains a physical examination of the claimant by a competent physician, it cannot be said that the insurer acts in bad faith when it relies upon the physician’s report to deny further benefits. Otherwise, the right to obtain a physical examination of the claimant is meaningless. The mere fact that equally competent physicians employed by the claimant *202thereafter reach a different conclusion is an inadequate basis on which to find that the insurer acted unreasonably or in bad faith. This is not altered merely because a court or jury subsequently determines that the opinions of the claimant’s physicians are more reliable. If the law were otherwise, an insurer would become liable for counsel fees in each case in which it mistakenly relied upon competent medical advice, whether or not its mistake was reasonable and whether or not it acted in bad faith. Indeed, in such cases the insurer would be compelled to rely upon the advice of physicians at its peril. This is not what the law provides. Before an insurer becomes liable for the payment of counsel fees, it must have acted unreasonably and in bad faith.
In the instant case, the insurer denied the claim for continuing medical expenses because competent physicians had examined the claimant and found further medical treatment unnecessary. I would hold that it was error to find that the insurer acted in bad faith under these circumstances and would reverse the award of counsel fees.
For the foregoing reasons, I would vacate the award of counsel fees and reverse and remand for transfer to the law side of the court for trial by jury on the claim for first party benefits.

. 75 Pa.C.S. § 1701 et seq.