410_C219
RESCUE
COSTS, NOT PROPERTY DAMAGE
|
Personal Automobile
|
Property Damage
|
|
Ambiguity
|
Consequential Damage
|
In April 2007, Melody Berlin (Berlin)
was driving a car insured by Safe Auto Insurance Company (Safe Auto). Her car
slid off the road, trapping her in the vehicle. McKean Hose Company (Hose), a
volunteer fire department that services the area where the accident occurred,
responded to an emergency service call. Hose freed Berlin from the vehicle and, shortly
afterwards, it sent a bill for $1,194 to Safe Auto. The bill was to recover its
expenses related to Berlin’s
rescue. The insurer refused the claim and filed for a declaratory judgment,
asking the court to find that it had no obligation to pay for Hose’s expenses
for the rescue. Berlin
was later sued by Hose to recover their costs. Both Berlin and Hose filed separate requests for
declaratory judgment; asserting that the rescue costs should be paid under the
auto policy as property damage. The lower court granted Safe Auto’s request and
Berlin and
Hose appealed.
All parties reasserted
their original arguments in the appeal. Safe Auto argued that their policy
language did not recognize Hose’s expenses as eligible damages and that it
performs its duties as a public service. Berlin
and Hose, again, presented their respective arguments (which were consolidated
by the higher court) that the expenses should be considered consequential
property damages and that the policy language, with regard to the meaning of property
damage, was ambiguous. Berlin
also argued that, as consequential damages were not specifically excluded by
her policy, the expenses claimed by Hose should be eligible for coverage.
The higher court examined
several questions on the trial court’s exercise of judgment on the arguments
made by Safe Auto, Berlin
and Hose. The court also examined the policy language found in its Part 1
liability section and in its definitions of “insured” and “property damage”.
Upon review, the higher
court was not persuaded by the arguments made by Berlin or Hose. In the court’s opinion,
while the policy did not contain a reference to consequential damages, it did
not consider Hose’s expenses to qualify as property damage; either direct or
consequential. It considered those amounts merely to be the costs of providing
an emergency service which is not an accidental event. Further, the fact that
those costs could be charged to the insured, Berlin, did not qualify as indirect damages
arising from the auto accident.
The appellate court ruled
to affirm the lower court’s finding that, due to its policy wording, Safe Auto
had no obligation to respond to Hose’s claim.
Safe Auto Insurance Co.,
Appellee v. Melody Berlin
and McKean Hose Company appellants. Superior Court of Pennsylvania No. J.A30007/09 and J.A0008/09
Filed March 5, 2010. Affirmed.