Court Opinion

ID: 9751840
Source: CourtListenerOpinion
Date Created: 2023-08-28 17:08:50.828348+00
Date Added: 2024-06-11T07:27:00.499548
License: Public Domain

Justice SAYLOR,
Concurring.
I differ with the majority’s position that the language of Section 544 is clear and unambiguous. See Majority Opinion at 502-03, 980 A.2d at 595. Rather, I find that Northland advances a colorable argument that Farm Bureau’s subrogation claim qualifies for subsection (b) priority under a literal reading of the statute, since Farm Bureau is a “claimant” standing in the shoes of a “third party” to a Reliance policy pursuing a “claim[ ] under [such] polic[y] for losses.” 40 P.S. *515§ 221.44(b).1 Since, however, a subrogation interest deriving from a potential third-party claimant is even further removed from the policy than the underlying third-party claim itself, a question arises whether the Legislature intended for such claims to enjoy subsection (b) priority. The National Association of Insurance Commissioners, drafter of the model legislation on which the Section 544 priority scheme is based, provides an extensive discussion of the history and intent of the statute, which I believe addresses the material ambiguity deriving from the indirectness of the subrogee’s connection to the policy of the insolvent insurer.
Principally, based on the drafting history and associated policies, I believe the NAIC persuasively demonstrates that subrogation claims were not considered the type of “loss claim” that subsection (b) priority is designed to address. See NAIC Brief at 7-11. Indeed, the NAIC observes that changes were made in 1994 which “merely make[ ] clear what was intended all along: that claims of subrogated insurers are not included in the same priority as those of [direct] third-party claimants and policyholders.” Id. at 11.
Chief Justice CASTILLE joins this concurring opinion.

. In this regard, I do not read Northland’s argument as placing it in a "double bind.” Majority Opinion, at 504-05, 980 A.2d at 595-96. Indeed, one of the linchpins to this conclusion, namely, the majority's position that Farm Bureau is not the claimant, see id. at 504-05, 980 A.2d at 595-96, seems to me to be strained. I fail to see how Farm Bureau is any less a "claimant” for purposes of subsection (b) than it is under subsection (g). Finally, in reasoning that Farm Bureau cannot be accorded subsection (b) priority because this would invest it with rights greater than the subrogor, see id. at 504-05, 980 A.2d at 596, the majority overlooks Northland’s argument that ”[i]t is black-letter law that a party in subrogation steps into the shoes of the subrogor and *516assumes its rights as they existed before — not after — indemnification occurred.” Northland Brief at 13-15.