Court Opinion

ID: 9763300
Source: CourtListenerOpinion
Date Created: 2023-08-29 02:40:28.691065+00
Date Added: 2024-06-11T07:29:40.666656
License: Public Domain

DISSENTING OPINION BY
Judge McGINLEY.
I respectfully dissent “to the majority’s conclusion that employer is entitled to sub-rogate against the uninsured motorist benefits claimant received under the customer’s motor vehicle insurance policy.” I particularly dissent to the majority’s attempt to distinguish American Red Cross v. Workers’ Compensation Appeal Board (Romano), 745 A.2d 78 (Pa.Cmwlth.2000), in footnote 11, and the characterization of the eustomer/ear owner in this case as “some third party.” The rationale applied by this Court in American Red Cross in denying the employer the right to subro-gate against proceeds received from car owner’s accident insurance (as opposed to a tortfeasor’s liability insurance) is equally applicable to this case since claimant, although not the owner of the policy, was a third party beneficiary of that policy.
Section 819, which is entitled “Subrogation of employer to the rights of employee against third persons” could not be clearer, in this regard:
§ 671. Subrogation of employer to the rights of employee against third persons; subrogation of employer or insurer to amount paid prior to award.
Where, the compensable injury is caused in whole or in part by the act or omission of a third party, the employer shall be subrogated to the right of the employe, his personal representative, his estate or his dependents, against such third party to the extent of the compensation payable under this [Act] by the employer ...
77 P.S. § 671 (Emphasis added).
As our Court explained in American Red Cross, for purposes of subrogation, there is a distinction between the proceeds obtained by a car owner from the tortfea-sor’s liability insurance and proceeds re*641ceived from his own accident insurance. I believe this vital distinction has been erroneously treated by the majority. Critically:
Liability insurance ... flows to the benefit of a third party tortfeasor, and accident insurance ... is maintained solely by the claimant and flows to his benefit... .When the insurance at issue is for the benefit of the third party tortfeasor, i.e., liability insurance which shields the tortfeasor’s personal or real property from execution to the limits of the policy, an employer and its insurance carrier do have a right to subrogate to recovery workers’ compensation benefits paid to the claimant. If, however, the policy at issue flows to the benefit of the claimant, i.e., accident insurance which provides recovery for a claimant when the tortfeasor cannot pay all or some of his total liability, then the employer does not have such a right because subrogation would not be against a third party tortfeasor... .Like the Superior Court, we also must conclude that proceeds obtained by a claimant through his own insurance policy, be it uninsured or underinsured provisions of that policy, the premiums for which are paid exclusively by the claimant, are fundamentally different than proceeds obtained from a third party and, therefore, are not subject to subrogation.
745 A.2d at 81 (emphasis added).
In this case, Claimant received uninsured motorist benefits by virtue of his status as a third party beneficiary under the customer’s accident insurance policy.1 The source of those proceeds was not the tortfeasor’s liability insurance; rather, it was the customer’s accident insur-anee. Uninsured motorist benefits are intended to benefit not only the insured, but also his resident relatives, passengers, lawful occupants and authorized drivers who are injured during the operation of the policy owner’s vehicle.
For the purpose of deciding whether an employer is entitled to subrogate against the proceeds a claimant received under an uninsured motorist benefits policy I would find that there is no difference between a policy holder and his beneficiaries. In both instances, the source of the funds received by claimant is from prophylactic accident insurance, not a third party tort-feasor’s fault-triggered liability insurance.
In Brubacher Excavating Inc. v. Workers’ Compensation Appeal Board (Bridges), 774 A.2d 1274 (Pa.Cmwlth.2001), this Court noted that subrogation serves the following purposes:
[T]he rationale for the right of subrogation is threefold: to prevent double recovery for the same injury by the claimant, to insure that the employer is not compelled to make compensation payments made necessary by the negligence of a third party, and to prevent a third party from escaping liability for his neg-ligence_ “[Subrogation] is just, because the party who caused the injury bears the full burden; the employee is made “whole,’ but does not recover more than what he requires to be made whole; and the employer, innocent of negligence, in the end pays nothing.” Thus where a third party’s negligent conduct causes injury to an employee actually engaged in the business of his employer, there is a clear, justifiable right to sub-rogation under Section 319 of the Act.
These enumerated purposes of subrogation are not achieved by the majority’s *642result. In an uninsured motorist situation, there is no third party to shoulder the full burden because no one, other than the uninsured tortfeasor, caused the injury. Neither the Act, nor any of the cases cited by the majority, justifies substituting the innocent customer’s insurance policy (the beneficiary of which was Claimant) as the source of proceeds from which employer has a right to subrogation. Unfortunately for the employer in this situation, because the tortfeasor was uninsured, there is no existing pocket for purposes of subrogation. There is simply no fund available to which the employer is entitled to subro-gate. That unfortunate fact does not entitle an employer to subrogate against the proceeds received from “some other third party” who had the foresight to protect himself, his passengers and occupants against uninsured drivers.
Contrary to the majority’s conclusion, neither City of Meadville (where the workers’ compensation carrier was allowed to subrogate against uninsured motorist benefits paid to claimant by the employer’s motor vehicle carrier) nor Poole (where the employer was entitled to subrogate proceeds from the claimant’s legal malpractice claim) compel this Court to ignore the plain and unambiguous language of Section 319 of the Act and expand an employer’s right to subrogation against proceeds received from “any and all third parties” regardless of the source.
Just as this Court in American Red Cross declined to allow the employer to subrogate against the proceeds received from the car owner’s own policy, this Court should decline to allow the employer to subrogate against uninsured motorist benefits provided by that policy’s third party beneficiary coverage.
I would reverse the Board and reinstate the order of the WCJ.

. It is well settled that 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. General Accident Insurance Co. of America v. Parker, 445 Pa.Super. 300, 665 A.2d 502 (1995).