Arbitration Award by Default Upheld Against Tardy Appeal
People like to sue insurance companies. They believe, often correctly, that it is easy because jurors dislike insurance companies and even if the case has no merit they will enter a judgment in favor of the insured. To do so, however, it is important that the person suing the insurance company, acts promptly and effectively.
In State Farm Insurance Company v. Dawn Mcateer, J-A27040-18, No. 576 EDA 2018, Superior Court of Pennsylvania (March 5, 2019) Dawn McAteer appealed from the Order dismissing her “Petition to Strike, Set Aside and Open Judgment, Award, and All Actions of Arbitrators.” She maintains that she was denied a full and fair arbitration hearing and that the judgment entered on the resultant award is therefore void.
The trial court aptly summarized the procedural history and facts of this case as follows:
“On July 31, 2001, [McAteer] was involved in a vehicle accident resulting in personal injury. [State Farm] insured [McAteer] at the time of the accident. On December 2, 2002, [McAteer] sued the alleged tortfeasor in The Philadelphia Court of Common Pleas resulting in settlement on or about October of 2003. ¶ On April 23, 2004, [McAteer] filed a Petition to Appoint Arbitrator and Compel Arbitration in the Philadelphia Court of Common Pleas. [McAteer] challenged the policy coverage provided by [State Farm] for uninsured motorists. … The Philadelphia Court of Common Pleas again transferred the second Petition to Bucks County. [McAteer] appeals the court’s decision and the Superior Court held, inter alia: ¶ [McAteer] develops no argument related to the trial court’s determinations that it was bound by the 2004 ruling transferring venue to Bucks County and that she failed to assert a specific contractual basis that permitted venue in any county in which she resided at the time of filing her petition.”
State Farm filed a Petition to Appoint Arbitrator(s). After repeated attempts to serve this third Petition on McAteer at various addresses, the court entered an Order granting alternative service by means of publication, or regular and certified U.S. Mail, and by serving McAteer’s last known attorney of record. McAteer claimed that at no time was an arbitration scheduled and held by the arbitration panel or was any notice of anything provided to Dawn McAteer relating to or regarding the third petition. In fact, notice was issued by several means.
Due to McAteer’s inaction and that McAteer’s arbitrator did not participate in the proceedings and the panel decided in favor of State Farm on November 3, 2014. A Judgment on the Award of the Arbitrators in favor of State Farm was entered on December 10, 2014. Notice of the Judgment was mailed in accordance with Pennsylvania law.
Nearly two years later, McAteer filed a Petition to Strike, Set Aside and Open Judgment, Award, and All Actions of the Arbitrators on December 6, 2016. State Farm sought a Protective Order from the Court on January 25, 2017. The parties sought a ruling on McAteer’s Petition to Strike/Open and State Farm’s Protective Order. On January 18, 2018, this Court entered an Order granting State Farm’s Protective Order and denying McAteer’s Petition to Strike, Set Aside, and Open the Judgment.
McAteer thus waived all issues on appeal.
The 58-paragraph Rule 1925(b) statement she attached to her brief – even assuming it is the same as what she delivered to the trial judge – preserved no issues due to its incoherence. What is more, none of the many issues she catalogues in her statement correspond to the one issue McAteer lists in her Statement of Questions Presented. As such, the appellate court concluded that McAteer waived all issues on appeal.
Regardless, the trial court properly dismissed her petition. Despite the broad title she gave to her petition, the only relief she sought was to set aside the arbitration award. However, McAteer filed her petition nearly two years after receiving the arbitration award, when she ought to have filed it within 30 days.
The fact that McAteer’s insurance policy provides for arbitration under the now-repealed Pennsylvania Arbitration Act of 1927 (“1927 Act”) does not change the outcome. Even the 1927 Act’s provision of 90 days in which to seek relief in court from an arbitration award would not help McAteer.
In any event, although parties to a contract may elect to arbitrate disputes under the 1927 Act’s substantive standards, they cannot choose that act’s procedural provisions, such as the 90-day period for petitions to court. Failure to act promptly resulted in a dismissal.
A waste of court time. A waste of the time of the arbitrators and State Farm. A total waste of time, money and effort by a litigant who did everything wrong, waited over two years to complain and then did so improperly and incoherently. This type of specious conduct requires punishment as a frivolous action.
© 2019 – Barry Zalma
This article, and all of the blog posts on this site, digest and summarize cases published by courts of the various states and the United States. The court decisions have been modified from the actual language of the court decisions, were condensed for ease of reading, and convey the opinions of the author regarding each case.
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 50 years in the insurance business. He is available at http://www.zalma.com and firstname.lastname@example.org.
Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.
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