Court Opinion

ID: 4446810
Source: CourtListenerOpinion
Date Created: 2019-10-15 17:09:33.397678+00
Date Added: 2024-06-11T14:53:20.169518
License: Public Domain

J-A22022-19

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

  PENNSYLVANIA INTEGRATED RISK            :   IN THE SUPERIOR COURT
  MANAGEMENT ASSOCIATION                  :      OF PENNSYLVANIA
                                          :
                     v.                   :
                                          :
  STEVEN HOMANKO, BOROUGH OF              :
  NESQUEHONING, SEAN SMITH AND            :
  MICHAEL SAUERS, INDIVIDUALLY            :
  AND AS ADMINISTRATOR OF THE             :
  ESTATE OF CAROLA R. SAUERS              :
                                          :
  APPEAL OF: MICHAEL SAUERS,              :
  INDIVIDUALLY AND AS                     :
  ADMINISTRATOR OF THE ESTATE             :
  OF CAROLA R. SAUERS                     : No. 277 EDA 2019

               Appeal from the Order Entered December 31, 2018
                in the Court of Common Pleas of Carbon County
                        Civil Division at No(s): 17-2151

BEFORE:    MURRAY, J., STRASSBURGER, J.* and PELLEGRINI, J.*

MEMORANDUM BY STRASSBURGER, J.:                  FILED OCTOBER 15, 2019

      Michael Sauers (Sauers), individually and as administrator of the estate

of Carola R. Sauers, appeals from the order entered December 31, 2018,

which granted judgment on the pleadings in favor of Pennsylvania Integrated

Risk Management Association (PIRMA), concluding PIRMA had no duty to

defend or indemnify police officer Steven Homanko in an underlying civil action

in which Sauers is the plaintiff and Homanko is a defendant. We affirm.

      The trial court provided the relevant factual and procedural history of

this matter.

* Retired Senior Judge assigned to the Superior Court.
J-A22022-19

            In the underlying action, [] Sauers, individually and as the
      administrator of the Estate of Carola R. Sauers, brought suit
      against [] Homanko, Sean Smith, and the Borough of
      Nesquehoning [(the Borough)] [in the United States District Court
      for the Middle District of Pennsylvania.] That action arises out of
      a motor vehicle collision wherein [] Homanko, while acting within
      the scope of his employment as a police officer for the Borough
      [], was traveling in excess of one hundred (100) miles per hour in
      pursuit of a vehicle which [] Homanko had observed committing a
      summary traffic offense.         [] Homanko’s collision with the
      Sauers[es’] vehicle resulted in the death of Carola Sauers and
      multiple personal injuries to [] Sauers. Based upon his actions
      which resulted in the collision, [] Homanko was charged criminally
      and subsequently pleaded guilty to homicide by vehicle, recklessly
      endangering another person [(REAP)], failure to keep right, and
      careless driving.

            Prior to the collision, the Borough [] entered into a “Legal
      Defense and Claim Payment Agreement” with [PIRMA]. This
      agreement provide[d] that [PIRMA] [would] defend and indemnify
      the Borough, including employees acting within the scope of their
      employment, against any suit seeking damages, unless an act is
      not covered by the agreement. The agreement explicitly excludes
      criminal acts, which are defined as injury arising out of any
      criminal act or violation of a penal statute. This exclusion does
      not apply until it has been judicially determined that the employee
      did commit such criminal act or violation.

Trial Court Opinion, 3/27/2019, at 2-3 (capitalization altered, citations

omitted).

      On September 21, 2017, PIRMA filed the instant action against, inter

alia, Sauers, asserting it was entitled to declaratory judgment pursuant to 42

Pa.C.S. §§ 7531-41 (Declaratory Judgments Act). According to PIRMA, the

claims set forth in the underlying action are not covered under the agreement

between PIRMA and the Borough. Thus, PIRMA requested a declaration that

it owed no duty to defend or indemnify Homanko in the underlying action.

                                     -2-
J-A22022-19

      After the close of pleadings, on January 8, 2018, PIRMA filed a motion

for judgment on the pleadings. Argument was held on April 26, 2018, and on

December 31, 2018, the trial court granted judgment on the pleadings in favor

of PIRMA and against Sauers. Sauers timely filed a notice of appeal, and both

Sauers and the trial court complied with Pa.R.A.P. 1925.

      On appeal, Sauers sets forth three issues for our review.

      1. Did the trial court commit reversible error when it found that
      the subject insurance policy does not violate the public policy set
      forth in the Pennsylvania Motor Vehicle Financial Responsibility
      Law where [its] decision permits a denial of coverage in any motor
      vehicle accident by the insurer for the at fault driver if that driver
      is found guilty of any criminal act?

      2. Did the trial court commit reversible error when it found that
      the subject insurance policy’s blanket “criminal acts” exclusion is
      not overly broad even though any criminal act, no matter how
      minor, triggers the exclusion?

      3. Did the trial court commit reversible error when it found that
      the subject insurance policy is not internally inconsistent, and
      therefore ambiguous and illusory, since it provides coverage for
      conduct which constitutes criminal acts and then excludes
      coverage for criminal acts upon conviction?

Sauers’s Brief at 4 (capitalization altered).

      “Our scope and standard of review of the granting of a motion for

judgment on the pleadings is well-settled.” Rubin v. CBS Broad. Inc., 170

A.3d 560, 564 (Pa. Super. 2017).

            Our scope of review on an appeal from the grant of
      judgment on the pleadings is plenary. Entry of judgment on the
      pleadings is permitted under Pennsylvania Rule of Civil Procedure
      1034, which provides that “after the pleadings are closed, but
      within such time as not to unreasonably delay trial, any party may
      move for judgment on the pleadings.” Pa.R.C.P. 1034(a). A

                                      -3-
J-A22022-19

      motion for judgment on the pleadings is similar to a demurrer. It
      may be entered when there are no disputed issues of fact and the
      moving party is entitled to judgment as a matter of law. In
      determining if there is a dispute as to facts, the court must confine
      its consideration to the pleadings and relevant documents. On
      appeal, we accept as true all well-pleaded allegations in the
      complaint.

            On appeal, our task is to determine whether the trial court’s
      ruling was based on a clear error of law or whether there were
      facts disclosed by the pleadings which should properly be tried
      before a jury or by a judge sitting without a jury.

             Neither party can be deemed to have admitted either
      conclusions of law or unjustified inferences.         Moreover, in
      conducting its inquiry, the court should confine itself to the
      pleadings themselves and any documents or exhibits properly
      attached to them. It may not consider inadmissible evidence in
      determining a motion for judgment on the pleadings. Only when
      the moving party’s case is clear and free from doubt such that a
      trial would prove fruitless will an appellate court affirm a motion
      for judgment on the pleadings.

Id. (internal citations omitted).

      Following a review of the record and the briefs for the parties, we

conclude that the opinion of the Honorable Steven R. Serfass thoroughly

addresses Sauers’s issues. Specifically, we adopt the portions of the trial court

opinion setting forth the rule of law regarding contract interpretation, see Trial

Court Opinion, 3/27/2019, at 6-7, and the three issues set forth by Sauers,

see id. at 9-11 (concluding that the agreement was neither overly broad nor

internally inconsistent such that it renders the insurance policy illusory), and

id. at 13-15 (concluding that the agreement does not violate either public

policy or the Motor Vehicle Financial Responsibility Law). We discern no error

of law on those issues. Nor do we conclude that there are facts disclosed by

                                      -4-
J-A22022-19

the pleadings which should be tried by a judge or jury. Therefore, we adopt

the aforementioned portions of the trial court’s opinion of March 27, 2019, as

our own, and affirm the order of the trial court.1

       Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 10/15/19

____________________________________________
1 The parties shall attach a copy of the trial court’s March 27, 2019 opinion to
this memorandum in the event of further proceedings.

                                           -5-
                                                                     Circulated 10/08/2019 10:24 AM

  IN THE COURT OF COMMON PLEAS OF CARBON COUNTY, PENNSYLVANIA
                         CIVIL DIVISION

PENNSYLVANIA INTEGRATED RISK
MANAGEMENT ASSOCIATION,

            Plaintiff

                    v.                         No.   17-2151

STEVEN HOMANKO, BOROUGH OF
NESQUEHONING, SEAN SMITH, and
MICHAEL SAUERS, Individually
and as the Administrator of
the ESTATE OF CAROLA R.
SAUERS,

             Defendants

Brian J. Madden, Esquire                       counsel for Plaintiff

Donald G. Karpowich, Esquire                   Counsel for Steven Homanko

Michael B. ·Kaspszyk, Esquire                  Counsel for Michael Sauers,
                                               Individually and as the
                                               Administrator of the Estate
                                               of Carola R. Sauers

                                MEMORANDUM OPINION

Serfass, J. - March 27, 2019

       Steven     Homanko    (hereinafter      "Homanko")       and Michael          Sauers

(hereinafter "Sauers")          have taken this appeal from our order of

December             2018,      granting       Pennsylvania          Integrated          Risk

Management      Association      (hereinafter        "Plaintiff")        a   Declaration

that   it   has    no    duty   to   defend     or       indenmify    Homanko       in    the

underlying matter of Michael            Sauers       &    the Estate      of    Carola R.

Sauers v. Steven Homanko, et al., United States District Court for
                                      FS-6-19
                                           1
the Middle District of Pennsylvania; Docket No. 3:16-CV-00811. We

file the       following memorandum opinion pursuant                 to     Pennsylvania

Rule     of    Appellate     Procedure      192S(a)       and    recommend     that   the

aforesaid order be affirmed for the reasons set forth hereinafter.

                          FACTUAL AND PROCEDURAL HISTORY

       On     September    21,   2017,     Plaintiff,      Pennsylvania       Integrated

Risk Management Association, filed a complaint against Defendants,

Steven Homanko, the Borough of Nesquehoning, Nesquehoning Chief of

Police      Sean Smith,     and Michael Sauers,           individually and as the

administrator       of     the   Estate     of   Carola     R.    Sauers,     seeking    a

declaratory judgment that Plaintiff need not defend or indemnify

Officer Homanko in the underlying action before the United States

District Court for the Middle District of Pennsylvania.

       In the underlying action, Michael Sauers, individually and as

the administrator of the Estate of Carola R. Sauers, brought suit

against       Steven      Homanko,       Sean    Smith,     and     the     Borough     of

Nesquehoning. That action arises out of a motor vehicle collision

wherein Officer Homanko,             while acting within the              scope of his

employment as a police officer for the Borough of Nesquehoning,

was traveling in excess of one hundred                    {100)   miles per hour in

pursuit of a vehicle which Officer Homanko had observed committing

a summary traffic offense.            Officer Homanko's collision with the

Sauers vehicle resulted in the death of Carola Sauers and multiple

personal injuries to Michael Sauers. Based upon his actions which
                             FS-6-19
                                            2
resulted in the collision, Officer Homanko was charged criminally

and subsequently pleaded guilty to Homicide by Vehicle,                       75 Pa.

c.S.A.   §   3732, Recklessly Endangering Another Person, 18 Pa. C.S.A.

§   2705, Failure to Keep Right, 75 Pa. C.S.A. § 3301, and Careless

Driving, 75 Pa. C.S.A. § 3714.

       Prior to the collision, the Borough of Nesquehoning entered

into a "Legal Defense and Claim Payment Agreement" with Plaintiff.

This agreement provides that Plaintiff will defend and indemnify

the Borough, including employees acting within the scope of their

employment, against any suit seeking damages, unless an act is not

covered      by     the    agreement.     The       agreement   explicitly   excludes

criminal acts,            which are defined as          injury arising out of any

criminal act or violation of a penal statute. This exclusion does

not apply until it has been judicially determined that the employee

did commit such criminal act or violation.

       On January 8, 2018, Plaintiff filed a motion for judgment on

the pleadings arguing that               Plaintiff has no duty to defend or

indemnify Homanko under the agreement because Pennsylvania courts

have     consistently        upheld     criminal      act   exclusion   clauses,   the

criminal acts need not be intentional for the exclusion to apply,

and it would be against well-established public policy to require

Plaintiff      to    defend Horna.nko     for what has been deemed criminal

conduct.

                                         FS-6-19
                                                3
      on    February      12,     2018,        counsel       for   Defendants    Sauers    and

Homanko filed briefs in response to Plaintiff's motion. Mr. Sauers

argued     that    Officer       Homanko        did   not     intentionally      commit    the

criminal acts,          that the criminal acts exclusion is overly broad

such that it renders the agreement illusory, that the agreement is

ambiguous because the term "criminal acts"                            is not    specifically

defined, and that the exclusion is against public policy. Officer

Homanko argued that the underlying litigation complaint sounds in

negligence        and    that    the     language        "judicial      determination"      is

ambiguous.        On    March      19,     2018,       Plaintiff       filed    replies     to

Defendants'       briefs.        Thereafter,          this    Court    heard    argument    on

Plaintiff's motion for judgment on the pleadings.

      On December 31,            2018,    this court granted Plaintiff's motion
                                                                                   !
for judgment on the pleadings and entered a judgment that Plaintiff

has   no   duty to defend or              indemnify Homanko            in the underlying

litigation before the United States District court for the Middle

District of Pennsylvania.

      On January 21,            2019,    Sauers filed a notice of appeal to the

Superior Court. On January 22,                   2019, this Court entered an order

directing Sauers to file of record, within twenty-one (21) days,

a concise statement of the matters complained of on appeal pursuant

to Pennsylvania Rule of Appellate Procedure 1925(b). On January

28,   2019,   Homanko also filed a notice of appeal to the superior

Court.     That    same    date,        this     Court entered        an   order directing
                                               FS-6-19
                                                 4
Homanko to file of record, within twenty-one (21) days, a concise

statement        of    the    matters       complained of       on     appeal     pursuant    to

Pennsylvania          Rule        of    Appellate       Procedure    1925(b).      Sauers    and

Homanko    each        filed a         concise   statement     in    accordance with our

orders on February 4, 2019, and February 14, 2019, respectively.

                                             DISCUSSION

        Sauers'       concise statement is general as he avers that the

basis for our decision cannot be readily discerned. Sauers appears

to raise the           following issues for review:                  ( 1)    whether criminal

acts must be intentional to be excluded under the insurance policy;

(2)   whether the criminal acts exclusion is ambiguous and overly

broad    such that           it    renders    the       insurance policy illusory;           {3)

whether the criminal acts exclusion is contrary to public policy;

and {4) whether the criminal acts exclusion is a violation of the

Pennsylvania Motor Vehicle Financial Responsibility Law.

      Homanko raises the following issues for review:                              (1) whether

the phrase "judicially determined" is sufficiently clear on its

face without explicit definition in the contract; and (2) whether

the   underlying negligence                 complaint      triggers         the criminal    acts

exclusion in the contract. We will address each issue below.

        First,    we note          the    standard upon which this Court decided

Plaintiff's           motion.          Defendants       challenge    this      Court's     order

granting a motion                 for judgment on the pleadings.                A motion     for

judgment on the pleadings is proper where the pleadings evidence
                             FS-6-19
                                                    5
that there are no material facts in dispute such that a trial would

be    unnecessary.        Pennsylvania        Financial     Responsibility Assigned

Claims Plan v. English, 664 A.2d 84,                  86    (Pa. 1995). In reviewing

such a motion, the trial court looks only to the pleadings and any

documents properly attached thereto. Id.

       The task of interpreting a contract is generally
       performed by a court rather than by a jury. The goal of
       that task is, of course, to ascertain the intent of the
       parties as manifested by the language of the written
       instrument. Where a provision of a policy is ambiguous,
       the policy provision is to be construed in favor of the
       insured and against the insurer, the drafter of the
       agreement. Where, however, the language of the contract
       is clear and unambiguous, a court is required to give
       effect to that language.

standard Venetian Blind Co. v. American Empire Insurance Co., 469

A. 2d 563,      566     (Pa.    1983)   (internal citations omitted) .           "When an

insurer seeks to               deny coverage based upon an exclusion in the

policy,      it    is    the      insurer's    burden      to   demonstrate      that   the

exclusion applies." Allstate Ins. Co. v. Brown, 834 F. Supp. 854,

857    (E.D.      Pa.    1993).     "The   burden    is    on   the   insured,    not   the

insurer, to introduce evidence to show that the exclusion which

appears to be triggered does not apply after all." Air Prod.                              &

Chemicals,        Inc. v. Hartford Acc.            & Indem. Co.,      25 F.3d 177,      180

(3d Cir.       1994).     In determining whether an insurer has a duty to

defend,    the complaint claiming damages must be compared to the

policy and a determination made as to whether the insurer would be

                                           FS-6-19
                                               6
required to pay the resulting judgment                 if   the allegations        are

sustained.    Gene1s Restaurant,         Inc. v.     Nationwide Insurance Co.,

548 A.2d 246, 246       (Pa. 1988). The particular cause of action that

a complainant pleads against an insured is not determinative of

whether the insurer's duties to defend and to indemnify have been

triggered,    but    rather it    is    necessary to        look at   the factual

allegations contained in the complaint. Mutual Benefit Insurance

Co. v. Haver, 725 A.2d 743, 745 (Pa. 1999).

      This   Court      found   that     Plaintiff     demonstrated        that    the

exclusion applies and that Plaintiff has no duty to defend Homanko

in the underlying litigation. Having failed the more lenient duty-

to-defend test,      Defendants cannot prove Plaintiff has a duty to

indemnify    Officer      Homanko.      See   Erie     Insurance      Exchange     v.

Claypoole,    158,   673 A.2d 348,       356 n.3     (Pa.Super.    1996)    ("As the

duty to defend is broader than the duty to indemnify,                   [plaintiff)

could not be required to indemnify [defendant] without also being

obligated to defend him.").

      Further, after Plaintiff demonstrated that the criminal acts

exclusion contained in the insurance policy applies to Homanko,

the burden shifted to Defendants to introduce evidence to show

that the exclusion which appears to be triggered does not apply

after all. This Court found that Defendants failed to prove that

the exclusion is inapplicable. The commission of the criminal acts

to   which   Homariko   pleaded   guilty precludes           coverage      under   the
                                       FS-6-19
                                          7
criminal acts       exclusion of the policy regardless of whether he

acted negligently or intentionally. Moreover, there is no dispute

as to any material fact regarding whether Officer Homanko's acts

were negligent or intentional because that fact is immaterial based

on the terms of the exclusion itself. Thus, we were constrained to

grant the Plaintiff's motion and find that Plaintiff has no duty

to defend or indemnify Homanko in the underlying litigation now

pending in federal court.

  I.     The insurance policy does not require that criminal acts

         be intentional to be excluded from coverage

       Sauers argues that criminal acts committed by Homanko must be

intentional    to    be   excluded   from   coverage   under   the   insurance

policy. The insurance policy specifically provides that criminal

acts will be excluded from coverage and defines criminal acts as

follows:

       D. CRIMINAL ACTS meaning injury arising out of any
       criminal act or violation of a penal statute or ordinance
       committed by the member or with the member's consent or
       knowledge. The exclusion shall not apply until it has
       been judicially determined that the member did commit
       such criminal act or violation.

There is no indication within the language of the policy that the

criminal acts must be intentional. The language "criminal act" is

sufficiently clear on its face. See Nationwide Property & Casualty

Insurance Co. v. Schlick, No. 1909 WDA 2013, 2014 WL 10750738, at

                                     FS-6-19
                                        8
*4    (Pa. Super.      Dec .   18,    2014)        (" [W] e discern no support             in the

language of the exclusion or the Policy for Appellant's contention

that an 'act ... which is criminal in nature' should be limited to

acts    intending to cause harm.                   The phrase      'an act       . . .   which is

criminal in nature' is sufficiently clear on its face.n). Further,

Pennsylvania courts have upheld criminal acts exclusions without

"intentional",           "purposeful",             or   "willful"        requirements.           See

Allstate Ins. Co. v. Williams, No. CIV.A. 13-3048, 2014 WL 4682022

(E.D. Pa. Sept. 22, 2014).

       In this case, Homanko pleaded guilty to the criminal offenses

of Homicide by Vehicle 75 Pa. C.S.A.                    §   3732, Recklessly Endangering

Another Person 18 Pa. C.S.A.                  §    2705, Failure to Keep Right 75 Pa.

C.S.A.     §   3301,     and Careless Driving 75 Pa.                    C.S.A.     §     3714. His

criminal actions resulted in the death of Mrs.                              Sauers and the

injuries sustained by Mr. Sauers. "Tautological as it sounds, acts

that violate the Commonwealth's Criminal Code are by definition

criminal acts." Id. at *4 (internal citations omitted).

       Therefore,         criminal          acts    need    not    be    intentional        to    be

excluded from coverage under the insurance policy.

     II.   The    criminal           acts    exclusion        is   not    overly         broad    or

           ambiguous

       Next, Sauers argues that the criminal acts exclusion is overly

broad and ambiguous             such that           it renders      the    insurance policy

illusory. We disagree.
                                              FS-6-19
                                                    9
      Sauers' argument that "criminal acts" is not defined within

the definition section of the insurance policy is without merit as

the policy clearly and conspicuously defines "criminal acts" as

provided above.

      Sauers argues that the criminal acts exclusion is overly broad

such that any criminal conduct, no matter how minor, would trigger

the exclusion. In support of his position, Sauers cites Board of

Public     Education   v.   National   Union   Fire   Insurance    Co.   of

Pittsburgh, 709 A.2d 910 (Pa.Super. 1998), where the Superior Court

found that a criminal acts exclusion was overly broad. However,

Sauers fails to note that the insurance company in that case was

seeking to exclude coverage not for the criminal actor, who was a

volunteer not covered by the insurance policy, but for the school

district and supervising employees.        That is not the case here.

Plaintiff does not dispute its duty to defend and indemnify the

Borough of Nesquehoning and Chief Sean Smith. Plaintiff only seeks

to   exclude   the   employee who   committed the     criminal   act which

resulted in the injuries to Mr. and Mrs. Sauers as provided in the

agreement. Further, the language of the criminal acts exclusion in

this case is far less broad. Compare id. at 912 ("This policy does

not apply       . to any claim involving allegations of ... criminal

acts") .

                                 FS-6-19
                                    10
        Sauers also argues that the policy covers injuries for acts

that are criminal in nature while also excluding coverage for those

same criminal acts resulting in an internally inconsistent and

illusory policy. The policy defines "injury" as follows:

        Injury means:
        A.   harm,   including sickness or disease,       to the
        physical health of any person, including resulting
        death;
        B.   harm arising out of libel, slander, defamation of
        character, mental injury, anguish, shock or humiliation,
        including   sexual   abuse,   harassment,    molestation,
        corporal punishment or an invasion of an individual's
        right of privacy or control over their physical or mental
        properties.
        C.   harm arising out of assault and battery, improper
        detention, false arrest, false imprisonment, malicious
        prosecution, false or improper service of process;
        D.   harm arising out of wrongful entry, eviction or
        other invasion of the right of privacy or public
        occupancy;
        E.   violation of rights as protected by civil rights
        statutes;
        F.   unauthorized use of any advertising idea, material
        slogan, style, or title of others in your advertising;
        or
        G.   property damage.

        While "injury" does include coverage for numerous acts which

are criminal in nature, the "criminal acts" exclusion only applies

when    an   insured has been convicted of a crime and that crime

resulted in the injury for which a third party is seeking damages.

Thus,     coverage would not   be excluded if   there were merely an

allegation of one of the crimes listed under the injury definition,

if an insured had been found not guilty,         or if the   crime was

unrelated to the injury.

                                 FS-6-19
                                    11
        Finally,       Homanko      argues     that       the     phrase     "judicially

determined" within the "criminal acts" definition is not defined

and,    thus, makes it unclear whether the exclusion includes guilty

pleas or just guilty verdicts. Under Pennsylvania law, a conviction

from a guilty plea is equivalent to a conviction from a trial-by-

jury because a guilty plea constitutes an admission to all facts

alleged       in     the    indictment.      M.B.    ex    rel.     T.B.    v.     city   of

Philadelphia,         128   F.   App•x 217,     225-26      (3d Cir.       2005)    (citing

Commonwealth, Department of Transportation v. Mitchell, 535 A.2d

581,    585   (Pa.    1987)). Thus,       the language "judicially determined"

is sufficiently clear on its face and includes both guilty pleas

and guilty verdicts.

        The   criminal       acts   exclusion       is    neither   overly broad nor

ambiguous. It is not overly broad because it limits the exclusion

to     only those instances where the criminal act                     results in the

injury for which the actor has been sued. Additionally, the plain

meaning of the language "until it has been judicially determined

that the member did commit such criminal act or violation" is that

the actor must have been convicted of that criminal act in a court

of law, which further limits the scope of the exclusion. As stated

above, a plea of guilty and a verdict of guilty are both judicial

determinations that a person has committed a crime. When read as

a whole,       the    insurance policy is           consistent,      unambiguous,         and

neither illusory nor overly broad.
                                          FS-6-19
                                             12
     III. Criminal acts              exclusions      are    in accordance with public

           policy

       Sauers also argues that the criminal acts exclusion in this

insurance policy violates Pennsylvania public policy. We disagree.

Criminal acts exclusions seek to prevent an insurer from defending

a person for what has already been deemed criminal conduct in

violation of Pennsylvania public policy. See Federal Insurance Co.

v.   Potamkin,         961 F.     Supp.     109,    113    (E.D.      Pa.        1997);   Germantown

Insurance Company v. Martin, 595 A.2d 1172, 1175 (Pa.Super. 1991)

("The courts of Pennsylvania have refused to require an insurer to

defend an insured for his own intentional torts and/or criminal

acts."). Thus,             it would be against Pennsylvania public policy to

require        Plaintiff        to defend Homanko for what has already been

deemed criminal conduct by virtue of his guilty plea.

     IV.   The criminal acts exclusion is not in viol.ation of the

           Pennsyl.vania Motor Vehicl.e Financial. Responsibility Law

       Finally,         Sauers       argues    that       the    criminal          acts    exclusion

violates the Motor Vehicle Financial Responsibility Law ("MVFRL").

75 Pa. C.S.A.          §    1701 et seq.

       Under      the       MVFRL,    the     vehicle's         owner       is    responsible     for

maintaining        financial          responsibility            for   the        vehicle.    75   Pa.

C.S.A.     §   1786. "It is the vehicle that is covered by the automobile

policy,        while       an   individual     is   covered only by nature of his

function as        the driver of that vehicle."                       Lebanon coach Co,            v.
                                              FS-6-19
                                                 13
Carolina Cas.    Ins.    Co.,    675 A.2d 279,      284   (Pa.Super.       1996). The

MVFRL does not provide that an insurer must defend and indemnify

a driver even if that driver commits a crime while driving. An

insurer's duty to defend is a distinct obligation, different from

and broader than its duty to provide coverage. Id. at 286. Indeed,

the MVFRL itself excludes benefits for any insured who is injured

during the commission of a felony. 75 Pa. C.S.A.                  §   1718(a) (2).

      Sauers    argues    that    the    criminal    acts       exclusion violates

public policy and the purpose of the MVFRL as stated in Donegal

Mutual Insurance Company v. Long,

      The purpose of the Motor vehicle Responsibility Law is
      to require owners     of registered vehicles      to be
      financially responsible .... Victims of accidents with
      rental vehicles might [as a result of the coverage
      exclusion]     find themselves   without   recourse   to
      compensation for their injuries, or perhaps only to the
      extent of their own uninsured motorist coverage, absent
      the fortuity that the driver of the rental vehicle is
      covered by other insurance or possesses sufficient
      assets for compensation. The public policy enunciated by
      the Motor vehicle Financial Responsibility Law, pursuant
      to   its   1985 provisions,   is to foster     financial
      responsibility for damages caused to individuals on the
      roadways, not to promote uninsurance.

564 A.2d 937, 943-44 (Pa.Super. 1989).

      Here, there is no risk that the subject insurance agreement

will leave an injured third party without recourse. The insured is

the   Borough     of     Nesquehoning,       and     it     maintains       financial

responsibility     for    its    vehicles    through      the    subject    insurance

policy in compliance with the MVFRL. Nesquehoning itself cannot be

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excluded from coverage               under the       criminal   acts    exclusion as a

municipality cannot be convicted of a crime.

       Therefore, the criminal acts exclusion does not violate the

purpose or the text of the MVFRL.

  v.      Though the underlying complaint lies in negligence, it has

          been       judicially      determined       that   Homanko' s    actions were

          cri.mina1 acts as defined in the insurance policy contract

       Homanko argues that, because the underlying action sounds in

negligence, the criminal acts exclusion would not trigger.

       However, as stated above, the particular cause of action that

a complainant pleads against an insured is not determinative of

whether the insurer's duties to defend and to indemnify have been

triggered,       but   rather it       is necessary to          look at     the   factual

allegations contained in the complaint. Mutual Benefit Insurance

Co. v. Haver, 725 A.2d at 745. The complaint provides that Homanko

pleaded guilty to the criminal offenses of Homicide by Vehicle 75

Pa. C.S.A.       §   3732, Recklessly Endangering Another Person 18 Pa.

C.S.A.    § 2705,      Failure to Keep Right 75 Pa.               C.S.A.    § 3301,   and

Careless Driving          75   Pa.    C.S.A.     §   3714.   Those     criminal actions

resulted in the injury to Mr. and Mrs. Sauers, including the death

of Mrs.    Sauers,      for which the underlying complaint was brought.

Therefore, the criminal acts exclusion as provided in the insurance

policy applies, and Plaintiff need not defend or indemnify Homanko

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in the action before the United States District Court for the

Middle District of Pennsylvania.

                                 CONCLUSION

     For   the   reasons   set    forth   hereinabove,   we   respectfully

recommend that the instant appeal be denied and that our order of

December 31, 2018, be affirmed accordingly.

                                   BY THE COURT:

                                   Steven R. Serfass, J.

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