Court Opinion

ID: 9693828
Source: CourtListenerOpinion
Date Created: 2023-08-25 17:02:27.44119+00
Date Added: 2024-06-11T18:19:50.914799
License: Public Domain

SCHILLER, Judge,
dissenting:
Because I believe the majority embarks on a path that contravenes prior case law, violates jurisprudential principles, impedes public policy, and will ultimately .Cost all individual policy holders higher premiums, I respectfully dissent from that portion of the majority opinion which expands appellant’s exposure beyond the statutory minimum.
First, the conclusion that once the statutorily required notice under § 1731 is not provided, an insured may not thereafter validly select a lower level of uninsured motorist coverage pursuant to § 1734, contradicts this Court’s decision in Insurance Co. of State of Pa. v. Miller, 426 Pa.Super. 519, 627 A.2d 797 (1993). In Miller, this Court concluded that the insurance company did not provide the requisite notice under § 1731. Id. at 523-25, 627 A.2d at 799. The Court then addressed the insurer’s argument that an endorsement signed by the insured constituted a valid election under § 1734, and concluded that based on the facts produced at the bench trial, the insurer did not show that the insured made a knowing election under § 1734. Id. at 525-27, 627 A.2d at 800. Obviously, if the Miller Court believed that § 1731 notice was a prerequisite to a § 1734 election, it would not have needed to examine the evidence produced at trial concerning the § 1734 election. Thus an insurer’s failure to provide § 1731 notice does not ipso facto preclude an insured from making a valid election under § 1734 pursuant to the test set forth in Tukovits v. Prudential Ins. Co. of America, 448 Pa.Super. 540, 672 A.2d 786, alloc, denied, 546 Pa. 668, 685 A.2d 547 (1996).
Second, the idea that Irex knowingly and validly elected lower coverage is buttressed by Irex’ answer to National Union’s complaint, wherein Irex averred, “Irex Corporation admits that it fully understood that it was continually declining Pennsylvania Uninsured Motorist coverage for the vehicles covered by the policy of commercial insurance with National Union Fire Insurance Company for the policy year 1991-92 and forward, and it did this knowingly.” Irex Corporation’s Answer to Declaratory Judgment Action, at 14 (emphasis added). Such a statement clearly constitutes a judicial admission, a fact which is ignored by the majority. “A judicial admission is an express waiver made in court or preparatory to trial by a party or the party’s counsel, conceding for the purpose of trial, the truth of the admission.” General Equipment v. Westfield Ins., 430 Pa.Super. 526, 541, 635 A.2d 173, 181 (1993), alloc, denied, 537 Pa. 663, 644 A.2d 1200 (1994). The law of Pennsylvania has long recognized the eonclusiveness of judicial admissions as establishing the admitted fact as true: as the Pennsylvania Supreme Court stated almost 150 years ago, “the concessions of attorneys of record [in pleadings] bind their clients in all matters relating to the trial and progress of their cause.” Truby v. Seybert, 12 Pa. 101, 104 (1849). Judicial admissions in the pleadings are welcomed by courts, as they are “a device by which a trial may be expedited through the elimination of the need for proof of certain facts which are not disputed.” Durkin v. Equine Clinics, Inc., 376 Pa.Super. 567, 565-67, 546 A.2d 665, 669 (1988), alloc, denied, 524 Pa. 608, 569 A.2d 1367 (1989). Consequently, Irex’s judicial admission that it knowingly was declining uninsured motorists coverage should preclude any attempt to evade that fact by the third party beneficiary. Additionally, the *1157purchaser of the insurance in this ease was a multi-state corporation insuring a large fleet of automobiles, and incurring several thousand dollars each year in premiums; its choice of the lowest available premiums was consistent with a business decision to minimize business costs.
Third, the majority’s opinion has the effect of rewriting an insurance contract where both the seller and the purchaser of the policy agree on the record as to what coverages were selected. Here, unlike other cases raising similar issues, the party contesting the amount of uninsured coverage available is NOT the insured.1 See e.g. Botsko v. Donegal Mut. Ins. Co., 423 Pa.Super. 41, 620 A.2d 30, alloc, denied, 536 Pa. 624, 637 A.2d 284 (1993). I am unaware of any authority which allows a third party such as the De-vennys to change the terms of a contract agreed upon by the contracting parties, especially where the change is detrimental to both contracting parties.2 As the Pennsylvania Supreme Court explained:
An injured person who makes a claim for uninsured motorist benefits under a policy to which he is not a. signatory is in the category of a third party beneficiary. Historically, this Court has held that third party beneficiaries are bound by the same limitations in the contract as the signatories of that contract. The third party beneficiary- cannot recover except under the terms and conditions of the contract from which he makes a claim. Grim v. Thomas Iron Co., 115 Pa. 611, 8 A. 595 (1887). “[T]he rights of an alleged third party beneficiary may arise [sic] no higher than the rights of the parties to the contract and ... they are vulnerable to the same limitations which may be asserted between , the promisor and the promisee.” Jewelcor Jewelers & Distributors, Inc. v. Corr, 373 Pa.Super. 536, 553, 542 A.2d 72, 80 (1988), appeal denied sub nom., Granjewel Jewelers & Distributors, Inc. v. Corr, 524 Pa. 608, 569 A.2d 1367 (1989), citing Williams v. Paxson Coal Co., 346 Pa. 468, 31 A.2d 69 (1943).
Johnson v. Pennsylvania National Ins., 527 Pa. 504, 508, 594 A.2d 296, 298-99 (1991).
Finally, and perhaps most troubling, the majority’s holding that even the most sophisticated insured cannot elect a lower amount of uninsured motorist coverage under § 1734 if the insurer does not provide the notice required under § 1731 will have the effect of increasing automobile insurance rates for all drivers in the Commonwealth, a result that violates the public policy behind the Motor Vehicle Financial Responsibility Law. As the Pennsylvania Supreme Court recently reiterated, “the repeal of the No-Fault Motor Vehicle Insurance Act, 40 P.S. § 1009.101, and the simultaneous enactment of the MVFRL, reflected a legislative concern for the spiraling consumer cost of automobile insurance and the resultant increase in the number of uninsured motorists driving on public highways. This legislative concern over the increasing costs of automobile insurance is the public policy which is to be advanced when interpreting the statutory provisions of the MVRFL.” , Rump v. Aetna Casualty and Surety Co., — Pa. -, 710 A.2d 1093 (1998). Accord Caron v. Reliance Ins. Co., 703 A.2d 63, 69 (Pa.Super.1997). Today’s decision negates a party’s explicit desire to pay reduced insurance premiums in exchange for reduced coverage. This contravenes the established and laudatory public policy of lowering rates, and will ultimately raise the cost of insurance for all Pennsylvanians by forcing insurance companies to include in their premiums costs for potential future losses resulting from expanded exposure which was not selected and consequently not paid for by the purchaser of the insurance policy.

. Implied in the majority’s opinion is the notion that Irex joined with the Devennys in seeking $2,000,000 in uninsured motorist coverage. However, Irex did not contest National Union’s declaratory judgment action in the trial court, and Irex has not pursued this matter on appeal.

. The majority’s conclusion that the policy provides $2,000,000 in uninsured motorist coverage not only holds National Union to a potentially higher liability, but obviously subjects Irex to a significantly larger insurance bill than what it agreed to when it selected the terms of its policy.