Court Opinion

ID: 9367690
Source: CourtListenerOpinion
Date Created: 2023-02-01 17:07:50.121138+00
Date Added: 2024-06-11T17:16:02.773058
License: Public Domain

J-E02005-22

                                   2023 PA Super 14

    MICHELE LOFTUS AND RICHARD                 :   IN THE SUPERIOR COURT OF
    LOFTUS, HER HUSBAND                        :        PENNSYLVANIA
                                               :
                                               :
                v.                             :
                                               :
                                               :
    KATRINA DECKER                             :
                                               :   No. 611 WDA 2021
                                               :
    APPEAL OF: EASTERN ALLIANCE                :
    INSURANCE GROUP                            :

                 Appeal from the Order Entered April 23, 2021
    In the Court of Common Pleas of Indiana County Civil Division at No(s):
                               11725 CD 2020

BEFORE: PANELLA, P.J., OLSON, J., DUBOW, J., KUNSELMAN, J., NICHOLS,
        J., MURRAY, J., McLAUGHLIN, J., McCAFFERY, J., and SULLIVAN, J.

OPINION BY NICHOLS, J.:                              FILED: FEBRUARY 1, 2023

       Appellant Eastern Alliance Insurance Group appeals from the order

denying its petition to intervene in an action initiated by Michelle and Richard

Loftus (collectively, the Loftuses) in a praecipe for writ of summons against

Katrina Decker (Decker). After review, we quash.

       Briefly, the record reflects that on September 25, 2020, the Loftuses

filed a praecipe for writ of summons naming Decker as the defendant. On

February 25, 2021, Appellant filed a petition to intervene.1 In its petition,

Appellant asserted that Michelle Loftus (Loftus) was employed as a bus driver

for Appellant’s insured, Tri County Transportation. See Appellant’s Pet. to

____________________________________________

1 Because no complaint was filed, and due to the sparseness of the record at
this stage of the proceedings, we glean the background of this matter, as best
we can, from the facts alleged in Appellant’s petition to intervene.
J-E02005-22

Intervene, ¶¶ 1-7.     The petition further alleged that Loftus had sustained

injuries in an auto accident that occurred while she was in the course of her

employment with Tri County Transportation, and that Decker caused the auto

accident.    See id.   Due to her injuries, Loftus previously sought workers’

compensation benefits from Appellant, which claims that it paid Loftus

$196,093.34 in workers’ compensation benefits. See id. at ¶¶ 8-9. Appellant

states that the $196,093.34 is a statutory lien against any damages Loftus

may recover from Decker in a personal injury/tort action. See id. Appellant

contends that Loftus settled her workers’ compensation claim on May 14,

2020, and that the settlement agreement provided as follows:

      Employer/Carrier retains its absolute right to statutory
      subrogation pursuant to Section 319 of the Workers’
      Compensation Act, [77 P.S. § 671,] as amended. Claimant
      understands that in the event of a third-party recovery,
      Employer/Carrier is subrogated for all workers’ compensation
      benefits it paid to [Loftus] or on Claimant’s behalf, including the
      amount of this settlement, with no lien waiver as agreed upon by
      the Claimant. It shall be the responsibility of Claimant to notify
      [Appellant] of any third-party recovery either by settlement or
      trial and to satisfy [Appellant’s] statutory subrogation claim from
      the proceeds of any third-party recovery within thirty (30) days of
      receipt of any recovery.

Id. at ¶ 17.

      As noted previously, the Loftuses filed a praecipe for writ of summons

against Decker, and Appellant notified the parties of its workers’ compensation

subrogation lien. It is undisputed that the Loftuses have not filed a complaint.

However, although no complaint has been filed, Appellant filed a petition to

intervene.     Appellant asserts that intervention is necessary to protect its

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workers’ compensation lien because the Loftuses refuse to accept the $25,000

that Decker’s insurance carrier offered to settle the case. See id. at ¶¶ 15-

24. Appellant asserts that the Loftuses are prepared to abandon litigation and

not seek recovery against Decker unless Appellant agrees to compromise its

statutory lien rights. See id. at ¶¶ 21-22. Specifically, Appellant contends

that it is necessary for it to intervene to “prosecute this matter and protect its

statutory lien rights, which are not adequately represented by [the Loftuses]

or [Decker].” Id. at ¶ 23.

      Appellant attached a civil complaint to its petition to intervene. This

complaint lists Loftus as the sole plaintiff, and it alleges that Decker was legally

responsible for the accident and the damages that Loftus sustained.

Appellant’s Proposed Comp., 2/22/21, at 3-5. Appellant did not list itself as a

named party. Rather, Appellant listed itself as a third-party intervener and

subrogation lien holder. Id. at 2, 5.

      On April 23, 2021, the trial court denied Appellant’s petition to intervene

and concluded as follows:

      1. [The Loftuses] commenced this suit by filing “Plaintiff’s
         Praecipe for Writ of Summons” on September 25, 2020. A
         complaint has not been filed.

      2. There are no verified allegations of the facts supporting the
         cause of action, and, in fact, no cause of action [has] been
         alleged.

      3. Until a cause of action, and the facts supporting such cause of
         action, are alleged by [the Loftuses], the [trial court] is unable
         to determine the merits of [Appellant’s petition to intervene].

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      Wherefore, it is ordered, adjudged, and decreed that [Appellant’s
      petition to intervene] is denied. Provided, however, this denial is
      without prejudice to [Appellant] to file the same or similar
      [petition to intervene after] a complaint is filed.

Order, 4/23/21 (some formatting altered).

      Accordingly, the trial court concluded that it could not grant Appellant’s

petition to intervene pursuant to Pa.R.C.P. 2327, because, in the absence of

a complaint, no judgment could be entered. See Trial Ct. Op., 7/6/2021, at

1-3. Therefore, it was impossible for Appellant to demonstrate the existence

of a legally enforceable interest that intervention would protect.     See id.

Additionally, the trial court reasoned that Appellant could not establish the

right to appeal the order as a collateral order under Pa.R.A.P. 313(b), because

there is no right that would be “irreparably lost.” Id. at 3. The trial court

concluded that without a complaint or the possibility of an adverse judgment,

Appellant was initiating the action rather than protecting a right that could be

lost if the ability to appeal was denied. Id. at 2-3.

      Following the April 23, 2021 order denying its petition to intervene,

Appellant filed the instant appeal. Both the trial court and Appellant complied

with Pa.R.A.P. 1925.

      On March 10, 2022, a three-judge panel of this Court quashed the

appeal, and on March 23, 2022, Appellant timely filed an application for

reargument en banc. On May 17, 2022, this Court granted en banc review

and withdrew the prior panel’s decision. Reargument was heard by this Court

en banc on September 14, 2022, and this matter is now ripe for disposition.

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      Appellant presents the following issues for review:

      1. Pursuant to Pa.R.A.P. 313, is the instant matter appealable by
         right as collateral order?

      2. Did the [trial court] abuse its discretion and commit an error of
         law when it denied [Appellant’s] petition to intervene without a
         hearing, on the basis that the court had insufficient facts by
         which to consider the petition to intervene, when facts
         sufficient were alleged in the verified petition to intervene and
         not contested in Appellees’ response in opposition thereto?

Appellant’s Brief at 4 (some formatting altered).

      Appellant contends that the order denying its petition to intervene is

appealable as a collateral order under Pa.R.A.P. 313. In support, Appellant

claims that (1) the order can be reviewed without analyzing the merits of

Loftuses’ tort claims against Decker; (2) the order involves rights that are

deeply rooted in public policy and too important to deny an immediate review;

and (3) Appellants’ claim would be irreparably lost if review was postponed.

See Appellant’s Brief at 12-16.

      It is well settled that questions concerning the appealability of an order

implicate our jurisdiction.   Jacksonian v. Temple Univ. Health Sys.

Found., 862 A.2d 1275, 1279 (Pa. Super. 2004) (citation omitted).

Generally, an appeal to our Court lies only from a final order. See Barak v.

Karolizki, 196 A.3d 208, 215 (Pa. Super. 2018) (citing 42 Pa.C.S. § 742).

“[A] final order is any order that disposes of all claims and of all parties.”

Pa.R.A.P. 341(b)(1).   Typically, “an appeal will not lie from an order denying

intervention, because such an order is not a final determination of the claim

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made by the would-be intervenor.” First Commonwealth Bank v. Heller,

863 A.2d 1153, 1155 (Pa. Super. 2004) (citation omitted).2

       However, an appeal may be permitted if the order in question satisfies

the requirements for an appealable collateral order under Pa.R.A.P. 313.

Pursuant to Pa.R.A.P. 313(b), a collateral order must satisfy a three-pronged

test and is defined as an order that: “1) is separable from and collateral to the

main cause of action; 2) involves a right too important to be denied review;

and 3) presents a question that, if review is postponed until final judgment in

the case, the claim will be irreparably lost.”        In re Bridgeport Fire

Litigation, 51 A.3d 224, 230 n.8 (Pa. Super. 2012) (citation omitted).

“Absent the satisfaction of all three prongs of the collateral order test, this

Court has no jurisdiction to consider an appeal of an otherwise non-final

order.”   Spanier v. Freeh, 95 A.3d 342, 345 (Pa. Super. 2014) (citation

omitted).

       This Court has explained that:

       For the first prong of the analysis under Pa.R.A.P. 313(b), a court
       must determine whether the issue(s) raised in the order are
       separable from the central issue of the ongoing litigation. Under
       the second prong, in order to be considered too important to be
       denied review, the issue presented must involve rights deeply
       rooted in public policy going beyond the particular litigation at
       hand. An issue is important if the interests that would potentially
       go unprotected without immediate appellate review of that issue
       are significant relative to the efficiency interests sought to be
       advanced by the final judgment rule. Furthermore, with regard to
       the third prong of the analysis, our Supreme Court explained that
____________________________________________

2It is undisputed that the order denying Appellant’s petition to intervene is
not a final order.

                                           -6-
J-E02005-22

      whether a right is adequately vindicable or effectively reviewable,
      simply cannot be answered without a judgment about the value
      interests that would be lost through rigorous application of a final
      judgment requirement.

Bogdan v. American Legion Post 153 Home Assoc., 257 A.3d 751, 755-

56 (Pa. Super. 2021) (citation omitted and formatting altered).

      Appellant contends that the first prong of the test for a collateral order

is satisfied because the order denying intervention is separable from and

collateral to the central issue involving Decker’s liability for damages the

Loftuses sustained.    Appellant’s Brief at 12-13. Appellant asserts that the

second prong is also met because, as a workers’ compensation insurance

carrier, Appellant’s right of subrogation is protected by statute and its right to

recover its statutory lien is too important to be denied review. Id. at 13-15.

Finally, Appellant argues that the claims set forth in its petition to intervene

establish that intervention is the only way for Appellant to protect its

subrogation rights because the Loftuses have threatened to abandon their

cause of action, which would preclude Appellant’s subrogation claim. Id. at

15.

      The Loftuses respond that the order denying Appellant’s petition to

intervene does not satisfy the three prongs necessary for an appealable

collateral order.     Further, the Loftuses claim that the facts alleged in

Appellant’s petition to intervene are insufficient to determine the main cause

of action in the Loftuses’ writ of summons. Loftuses’ Brief at 9. Next, the

Loftuses assert that currently, Appellant has not lost any rights and it “is in

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J-E02005-22

the same position as it was prior to the writ of summons being filed.” Id. at

10.    Moreover, the Loftuses argue that the plaintiff controls whether a

complaint is filed against a third-party defendant and not the workers’

compensation insurance carrier. Id. The Loftuses also note that Appellant

could have protected its ability to pursue subrogation because it was free to

bargain for an assignment of rights from Michelle Loftus as part of a workers’

compensation settlement. Id. However, the Loftuses assert that Appellant

failed to secure such an assignment of rights, and Appellant should not be

able to complain that the issue is now “too important to be denied review.”

Id. The Loftuses conclude by contending that the order is not appealable and

assert that at this stage of the proceedings, where only a writ of summons

has been filed, the trial court cannot enter final judgment. Id. at 11.3

                                   Separable Claim

       We begin our review by addressing whether the order denying

Appellant’s petition to intervene satisfies the first prong of the collateral order

test requiring the order to be separable from the main cause of action. See

Bridgeport Fire Litigation, 51 A.3d at 231. Upon review, we conclude that

the order meets this first prong.

       Indeed, the order denying Appellant’s petition to intervene to protect its

subrogation rights is separable from and collateral to tort claims the Loftuses

could file against Decker. See, e.g., Bogdan, 257 A.3d at 756 (concluding
____________________________________________

3 The Loftuses acknowledge that the trial court could require them to file a
complaint or withdraw the writ of summons. Loftuses’ Brief at 11.

                                           -8-
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that where liquor liability insurance company sought to intervene in a

negligence action that the decedent’s estate filed against an American Legion

Post, liquor liability insurance company’s right to intervene was collateral to

the underlying action). Instantly, Appellant’s procedural ability to intervene

is distinct from and collateral to any claims for personal injuries or tort claims

the Loftuses could pursue against Decker. Accordingly, the order satisfies the

first prong, and we proceed to the second part of the test.

                               Important Right

      We next address whether the right involved is too important to be

denied review.    See Bridgeport Fire Litigation, 51 A.3d at 231.           After

careful review, we conclude that the order denying Appellant’s petition to

intervene does not meet this second prong because Appellant has no legal

interest or right to protect at this stage of the proceedings.

      Appellant argues that the trial court erred in holding that it could not

grant Appellant’s petition to intervene until a complaint was filed. Appellant’s

Brief at 17. Appellant contends that Pa.R.C.P. 1007(1) provides that an action

can be commenced by praecipe for writ of summons, and Pa.R.C.P. 2327

provides that “[a]t any time during the pendency of an action, a person not a

party thereto shall be permitted to intervene therein,” which renders

intervention allowable. Id. at 22-26.

      First, we note that a praecipe for writ of summons contains no statement

of facts, claims, rights, or prayer for relief, and it states merely: “You are

hereby notified that [name(s) of plaintiff(s)] has (have) commenced an action

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against you.”   Pa.R.C.P. 1351.     The purpose of the praecipe for writ of

summons is “to provide certainty as to the commencement of an action and

to remove a subsequent failure to effect service from consideration in

determining whether the statute of limitations has been tolled.” Sayers v.

Heritage Valley Medical Group, Inc., 247 A.3d 1155, 1161 (Pa. Super.

2021) (quoting Lamp v. Heyman, 366 A.2d 882, 886 (Pa. 1976)).

      The Loftuses’ writ of summons serves only a limited purpose, and it does

not contain any facts. Therefore, we agree with the trial court that, without a

complaint, the record does not contain sufficient information upon which to

determine whether Appellant’s intervention is proper under the Rules of Civil

Procedure. See Pa.R.C.P. 2327, 2328, and 2329. Because the Loftuses have

not filed a complaint, proceeding based on Appellant’s petition to intervene

would necessarily substitute Appellant in place of the Loftuses as plaintiff in a

tort action against Decker.    Essentially, through its petition to intervene,

Appellant would become the first party pleading the Loftuses’ cause of action,

claiming the facts supporting the Loftuses’ cause of action, and alleging the

Loftuses’ prayer for relief. Moreover, it would allow Appellant to both craft the

action and assert the reasons it should be permitted to intervene in that

action. As such, an objective analysis of the intervention factors from

Pa.R.C.P. 2327, 2328, and 2329 would be impossible, and the first party

pleading any facts in the case would not be the plaintiff or defendant, but

rather it would be a party with no legal interest to protect at this time.

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      Therefore, because Appellant does not yet have a legal interest or

important right to protect, we conclude that the order denying Appellant’s

petition to intervene does not meet the second prong of the test for an

appealable collateral order. See Bridgeport Fire Litigation, 51 A.3d at 231.

      With respect to Appellant’s claim concerning its subrogation rights, we

note that Section 319 of the Workers’ Compensation Act, 77 P.S. § 671, does

not bestow upon any party, directly or indirectly, the right to take any action

against a third-party tortfeasor.   See Hartford Ins. Group on behalf of

Chunli Chen v. Kamara, 199 A.3d 841 (Pa. 2018) (Kamara II); Liberty

Mutual Ins. Co. v. Domtar Paper Co., 113 A.3d 1230 (Pa. 2015) (Domtar

Paper). Instead, our Supreme Court has held that Section 319 provides that

only the employee can pursue damages from the tortfeasor, and the insurer

has no right to seek a recovery or compel an employee to seek recovery to

satisfy a statutory lien under the Workers’ Compensation Act. See Kamara

II, 199 A.3d at 853; Domtar Paper, 113 A.3d at 1240.

      In Domtar Paper, the insurer directly filed a complaint against a third-

party tortfeasor alleging negligence resulting in injury to an employee, who

had declined to pursue a claim against the tortfeasor. In response, the third-

party tortfeasor asserted that the insurer had no right to file an independent

claim for damages on behalf of the injured employee who did not file an action.

On appeal, the Domtar Paper Court held that under Section 319, an

insurance    carrier   has   “no    independent     cause    of   action    for

indemnification/contribution from the negligent party who caused the

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insurance carrier to pay the injured employee benefits.” Domtar Paper, 113

A.3d at 1239. The action against the third-party tortfeasor must be brought

by the injured employee. The Domtar Paper Court stated:

      [W]e reaffirm that the right of action against a third-party
      tortfeasor under Section 319 of the [Workers’ Compensation Act]
      remains in the injured employee, and that the employer/insurer’s
      right of subrogation under Section 319 must be achieved through
      a single action brought in the name of the injured employee or
      joined by the injured employee.

Id. at 1240.

      In Kamara II, our Supreme Court addressed the issue of whether an

insurer could bring an action against a third-party tortfeasor if it filed the

action on behalf of the employee. Kamara II, 199 A.3d at 842. In that case,

an employee of a rental car company was hit by a car driven by a third-party

driver while standing in her employer’s parking lot. The employee did not

want to participate in a third-party case against the driver, and the insurer

filed its complaint against the third-party tortfeasor as “The [insurer] on behalf

of [the claimant]” and captioned the plaintiff in the complaint as “The [insurer]

on behalf of [employee].” Id. at 843. The trial court sustained the third-

party tortfeasor’s preliminary objections and dismissed the insurer’s complaint

with prejudice.   On appeal, this Court vacated the trial court’s order and

remanded for further proceedings. See The Hartford Ins. Group on Behalf

of Chen v. Kamara, 155 A.3d 1108, 1113-14, 1115 (Pa. Super. 2017)

(Kamara I) (concluding that the insurer’s action, which was initiated “on

behalf” of the employee, was not an improper direct claim for subrogation,

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and the insurer could properly verify the complaint upon information and

belief).

      Our Supreme Court subsequently granted review and reversed this

Court’s decision in Kamara I. Specifically, the Supreme Court held that “the

right of action against the tortfeasor remains in the injured employee . . .

unless the injured employee assigns her cause of action or voluntarily joins

the litigation as a party plaintiff, the insurer may not enforce its statutory right

to subrogation by filing an action directly against the tortfeasor.” Kamara II,

199 A.3d at 842.

      Further, the Kamara II Court rejected the insurer’s claim that the

decision in Domtar Paper left open the possibility that an insurer could

pursue a cause of action against a third-party tortfeasor if the insurer initiated

litigation “in the name of” or “on behalf of” a claimant. Id. at 845, 849 (stating

that an employer or workers’ compensation carrier cannot seize the injured

employee’s cause of action against the tortfeasor “by merely captioning the

complaint ‘on behalf of’ the employee and/or by including in the complaint

independent claims of the employee in addition to the claim for subrogation

of workers’ compensation benefits”). Further, the Court held that the right of

recovery flows exclusively through the employee’s decision alone, that a claim

must be brought with the employee’s “participation,” and that there is no

“authority, statutory or otherwise, permitting an [insurer] to pursue

[employee’s] cause of action against [a t]ortfeasor without [the employee’s]

voluntary participation as a party plaintiff or the contractual assignment of her

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claim.” Id. Finally, the Court stated: “we reiterate our holding in Domtar

Paper and clarify that absent the injured employee’s assignment or voluntary

participation as a party plaintiff, the insurer may not enforce its Section 319

right to subrogation by filing an action directly against the tortfeasor.” Id. at

853.

       Further, our Supreme Court in Domtar Paper and Kamara II, clarified

that the Workers’ Compensation Act only permits the employee to maintain

an action against a third-party tortfeasor; the employee is under no obligation

to protect an insurer’s lien rights; and the insurer cannot bring a civil action

in its own name or “in the name of the employee” to satisfy its statutory lien

unless the employee “voluntarily” participates in the action or assigns its

rights. See Kamara II, 199 A.3d at 853; Domtar Paper, 113 A.3d at 1240.

       Here, Appellant acknowledges that it cannot independently seek to

recover its statutory lien against the third-party tortfeasor to satisfy its

workers’ compensation lien without an assignment of rights from the injured

worker. Appellant’s Brief at 26. Further, Appellant concedes that it does not

have such an assignment.       Id.   However, Appellant asserts that it can

intervene and file a complaint because it is not independently seeking to

recover its lien; rather, it only seeks to intervene in the action commenced by

the Loftuses’ praecipe for writ of summons. Id.

       After careful review, we disagree. As noted previously, although the

Loftuses filed a praecipe for writ of summons and “commenced” the underlying

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action against Decker,4 the filing is devoid of any relevant information, and

the action is speculative. Because there is no complaint, there are no specific

claims, facts, or prayers for relief. Additionally, it is undisputed that the right

to sue Decker remains with the Loftuses and that, at this stage, the record

does not yet enumerate the rights the Loftuses seek to exercise or the relief

sought.

       To the extent Appellant attempts to define and maintain a tort action on

behalf of the Loftuses in an effort to protect its own rights, it is precluded from

doing so under Domtar Paper and Kamara II. Specifically, we note that

Kamara II expressly prohibits Appellant from filing a complaint in Loftus’s

name and that allowing Appellant to intervene and name Loftus as the plaintiff

in a complaint is no different than allowing Appellant to maintain an

independent action in its own name to recover the workers’ compensation lien,

which Domtar Paper expressly prohibited. Further, Kamara II requires the

employee to “voluntarily” participate in the litigation directed at satisfying a

subrogation lien, and that instantly, the Loftuses are not voluntary participants

in Appellant’s proposed action.           Additionally, both Domtar Paper and

Kamara II held that an employee under Section 319 is under no obligation

to protect an insurance carrier’s subrogation lien and, therefore, Appellant’s

claim that intervention is necessary to protect its statutory lien because the

____________________________________________

4 An action may be commenced by filing a praecipe for a writ of summons or
a complaint. Pa.R.C.P. 1007.

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Loftuses may abandon the litigation is unavailing. See Kamara II, 199 A.3d

at 853; Domtar Paper, 113 A.3d at 1240.

       For these reasons, Appellant does not have a legally enforceable interest

to file suit on its own behalf or to compel the Loftuses to file a complaint

against Decker to protect Appellant’s subrogation lien.           Accordingly, we

conclude that at this juncture, Appellant has no legally enforceable interest

and no right that needs to be protected.5 As such, the order at issue does not

satisfy the second prong of the test to be an appealable collateral order. See

Bridgeport Fire Litigation, 51 A.3d at 231.

                                  Irreparable Harm

       For these reasons, we have concluded that Appellant has no right nor

interest to protect at this stage of the proceedings, however the trial court has

not precluded Appellant from filing its petition to intervene if the Loftuses file

their complaint. Therefore, the order denying intervention will not result in

any irreparable harm or loss of a claim, and the third prong of the test for an

appealable collateral order is not satisfied and no relief is due. See id.

____________________________________________

5We reiterate that no complaint has been filed in this case, and the trial court
specifically denied Appellant’s petition to intervene without prejudice to
Appellant’s right to file a petition to intervene if a complaint is filed. See Trial
Ct. Op., 7/6/21, at 2-3; see also Gleason v. Alfred I. Dupont Hosp. for
Children, 260 A.3d 256 (Pa. Super. 2021) (finding an order denying workers’
compensation insurer’s petition to intervene was appealable as a collateral
order where the employee had filed a complaint against the tortfeasor).

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                                      Conclusion

        For these reasons, we conclude that the order underlying this appeal is

not an appealable collateral order. Accordingly, we quash.6

        Appeal quashed.

        President Judge Panella, Judges Olson, Judge Dubow, Judge Kunselman,

Judge McLaughlin, Judge McCaffery and Judge Sullivan joins the opinion.

        Judge Murray files a dissenting opinion.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 2/1/2023

____________________________________________

6   In light of our conclusion, we do not reach Appellant’s remaining issue.

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