Starr Indemnity v. Brownsville Marine v. Benchmark ( 2019 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
STARR INDEMNITY & LIABILITY CO. : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
BROWNSVILLE MARINE PRODUCTS, :
LLC AND JAVIER SARDINA-GARCIA :
: No. 187 WDA 2019
:
v. :
:
:
BENCHMARK INSURANCE COMPANY; :
SYNERGY COMP INSURANCE :
COMPANY; SYNERGY SELECT, LP; :
AND MK INDUSTRIES, INC. :
:
:
APPEAL OF: BENCHMARK :
INSURANCE COMPANY; SYNERGY :
COMP INSURANCE COMPANY; AND :
SYNERGY SELECT, LP :
Appeal from the Order Entered January 7, 2019
In the Court of Common Pleas of Fayette County Civil Division at No(s):
381 of 2017 G.D.
BEFORE: SHOGAN, J., LAZARUS, J., and OLSON, J.
MEMORANDUM BY LAZARUS, J.: FILED DECEMBER 17, 2019
Benchmark Insurance Company (Benchmark), Synergy Comp Insurance
Company, and Synergy Select, LP (collectively, Additional Defendants) appeal
from the January 7, 2019 order, entered in the Court of Common Pleas of
Fayette County, instructing Benchmark to comply with the Honorable Linda R.
Cordaro’s October 12, 2018 order and opinion denying Additional Defendants’
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motion for judgment on the pleadings and directing Benchmark to defend
Brownsville Marine Products, LLC (Brownsville). After careful review, we
quash Additional Defendants’ appeal.
The trial court set forth the factual basis underpinning this appeal as
follows:
The current action giving rise to the motion for judgment on the
pleadings stems from an underlying action in tort.
On September 6, 2016, Javier Sardinia-Garcia filed the underlying
complaint in the Fayette Court of Common pleas. [] Sardinia-
Garcia claims he was employed as a shipfitter by MK industries . .
. and had been assigned by MK industries to perform work
involved in construction of new barges at [Brownsville’s] barge
construction facility. MK Industries [] is a staffing employment
company based in the State of Georgia, and also has an office and
conducts business in Fayette County, Pennsylvania.
On March 14, 2015, while working at Brownsville[’s] facility, []
Sardinia-Garcia [averred he] was “carrying a large jack” when he
“encountered an unguarded opening in the floor of the work site,
requiring [him] to jump over the opening” to avoid falling into it.
He [further averred he] landed on scrap metal and sustained
injuries to his foot and ankle. [] Sardinia-Garcia alleged
negligence against [Brownsville] and requested damages in
excess of $50,000.
After receiving the underlying complaint, [Brownsville] tendered
it to Starr Indemnity [(Starr)], seeking that Starr defend and
indemnify [Brownsville] against [] Sardinia-Garcia. [Brownsville]
has a commercial marine liability policy with Starr[,] covering the
period of March 4, 2015 to December 1, 2015.
Upon receiving the underlying complaint, Starr [] advised
[Brownsville] of Starr’s initial intention to defend, subject to a
reservation of rights[. A]fter reviewing the responses provided by
Brownsville[,] Starr concluded it did not have a duty to defend or
indemnify Brownsville[.] On February 24, 2017, Starr filed [a]
complaint in an action for declaratory judgment, asking this court
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to determine that it did not have a duty to defend or indemnify
[Brownsville] based on their marine liability agreement.
On May 31, 2017, [Brownsville] filed a complaint to add Additional
Defendants. These included Benchmark, Synergy Comp, Synergy
Select, and MK Industries. Brownsville had an insurance policy
with Benchmark and claim[ed] that Synergy Comp and Synergy
Select are part of that agreement. MK Industries is the firm that
allegedly hired Sardinia-Garcia.
On July 24, 2017, Starr filed its first motion for judgment on the
pleadings. That motion was denied without prejudice on October
6, 2017, and the parties were directed to comply with a discovery
order.
On March 14, 2018, after pleadings closed, Starr filed its renewed
motion for judgment on the pleadings. [Judge Cordaro] heard
oral argument for the motion on May 16, 2018. . . . Before
[Starr’s] renewed motion for judgment on the pleadings was
decided, Additional Defendants [] filed a motion for judgment on
the pleadings on May 9, 2018.
Trial Court Opinion, 10/12/18, at 2–4 (citations and quotations omitted)
(capitalization adjusted).
In this action, Starr and Additional Defendants both sought declaratory
judgments against Brownsville. Starr argued it was exempt from the duty to
defend or indemnify Brownsville as its policy did not apply to bodily injury
sustained by employees, and that, based on the language of the underlying
complaint, Sardinia-Garcia was a Brownsville employee. Benchmark argued
the opposite—that it was exempted from the duty to defend or indemnify
Brownsville as its policy only applied to bodily injury sustained by employees,
and that, based on the language of the underlying complaint, Sardinia-Garcia
was not a Brownsville employee.
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The court determined Sardinia-Garcia’s status as an employee was a
material question of fact, and that both Starr and Additional Defendants, as
movants, failed to establish whether or not Sardinia-Garcia was a Brownsville
employee for the purposes the duties to defend or indemnify. Consequently,
on October 12, 2018, Judge Cardoro denied both motions and concluded that
Starr and Benchmark had a duty to defend Brownsville against the underlying
complaint filed by Sardinia-Garcia.
On November 9, 2018, Benchmark, on behalf of Additional Defendants,
filed a motion for reconsideration asserting: 1) it was exempt from the duties
to defend or indemnify as Sardinia-Garcia’s complaint specifically alleged he
was an employee of MK Industries; and 2) the court erroneously required
Benchmark to prove Brownsville lacked coverage under Benchmark’s policy.
On November 30, 2018, Brownsville filed a brief in opposition to Additional
Defendants’ motion for reconsideration. Simultaneously, Brownsville filed a
motion to compel Additional Defendants to provide a defense pursuant to the
court’s October 12, 2018 order.
On January 7, 2019, the court issued two orders, the first denying
Additional Defendants’ motion for reconsideration, and the second, directing
Benchmark to provide Brownsville with a defense in the matter filed by
Sardinia-Garcia. The order directing Benchmark to provide Brownsville with
a defense reads as follows:
AND NOW, this 7th day of January, 2019, in consideration of
Brownsville[’s] Motion to Compel filed on November 30, 2018, it
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is hereby ORDERED and DIRECTED that the Motion is GRANTED
in that Benchmark [] shall provide Brownsville [] with a full and
immediate defense in the matter filed by [] Sardinia-Garcia in the
Fayette County Court of Common Pleas[.]
This Order applies only to [] Benchmark[,] who was found to have
a Duty to Defend Brownsville Marine by the Order and Opinion of
this Court dated October 12, 2018[.]
Order Affirming Motion to Compel, 1/17/19, at 1–2.
On February 6, 2019, Additional Defendants1 filed a notice of appeal,
pursuant to Pa.R.A.P. 311(a)(4), from the court’s January 7, 2019 order
reproduced above. Both Additional Defendants and the court both complied
with Pa.R.A.P. 1925.
Additional Defendants raise the following claims for our review:
1) Whether, because [] Sardinia-Garcia does not allege in his
complaint that he was an employee of Brownsville [] at the
time of his supposed injury and there is no indication in said
complaint that Brownsville [] controlled or had the right to
control his work, the [trial] court erred in determining that
the claims raised in [the underlying tort suit] triggered
coverage under the workers compensation and employers
liability policy issued by Benchmark [] to Brownsville[]?
2) Whether in making its coverage determination the [trial]
court: a) erred in its interpretation of [] Sardinia-Garcia’s
complaint; b) misapplied established law; c) misinterpreted
the Benchmark insurance policy; and d) improperly placed
the burden of proof on Benchmark[]?
3) Whether the [trial] court erred in granting Brownsville[’s]
request for injunctive relief in the form of a directive that
Benchmark [] begin providing Brownsville [] with an
immediate defense in the [underlying tort suit] because []
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1 Starr did not appeal the trial court’s decision.
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Sardinia-Garcia’s claims do not potentially fall within the
scope of the workers compensation and employers liability
policy that Benchmark [] issued to Brownsville[]?
Brief of Appellant, at 3–4.
Preliminarily, we consider Brownsville’s motion to quash Additional
Defendants’ appeal on the grounds that the order appealed is interlocutory.
See Brief of Appellee, at 14–17; see also Kulp v. Hrivnak, 765 A.2d 796,
798 (Pa. Super. 2000) (“[S]ince we lack jurisdiction over an unappealable
order[,] it is incumbent on us to determine . . . whether the appeal is taken
from an appealable order.”). Additional Defendants, in response, invoke Rule
311(a)(4), arguing the January 7, 2019 order from which they appeal is
appealable as of right because it had the effect of granting injunctive relief.2
See Reply Brief of Appellants, at 10.
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2 Additional Defendants also contend they were precluded from appealing the
court’s October 12, 2018 order denying Benchmark’s motion for judgment on
the pleadings as it was not a final order. See Reply Brief of Appellee, at 1–9.
As we find the order from which Additional Defendants chose to appeal is, in
fact, not appealable, this is a moot point. Nonetheless, we direct Additional
Defendants to the note appended to Pa.R.A.P. 341, which states, inter alia, as
follows:
Pa.R.A.P. 311(a)(8) provides for appeal as of right from an order
that is made final or appealable by statute or general rule, even
though the order does not dispose of all claims or of all parties
and, thus, is interlocutory[.]
[T]he rescission of subparagraph (b)(2) [in 2015 changed] the
basis for appealability of orders that do not end the case but grant
or deny a declaratory judgment. See Nationwide Mut. Ins. Co.
v. Wickett, 763 A.2d 813, 818 (Pa. 2000); Pa. Bankers Ass'n
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“As a general rule, this Court has jurisdiction only over appeals taken
from final orders.” Angelicho v. Myers, 110 A.3d 1046, 1048–49 (Pa. Super.
2015). “[Rule] 311 carves out an exception to this general rule.” Id. at 1049.
Rule 311(a)(4) provides “[a]n appeal may be taken as of right . . . from . . .
[a]n order that grants or denies, modifies or refuses to modify, continues or
refuses to continue, or dissolves or refuses an injunction[,]” with limited
exceptions not presently at issue. Pa.R.A.P. 311(a)(4). Our Supreme Court
stated, “the plain meaning of the words contained in Rule 311(a)(4) is that an
order refusing a request for an injunction is an interlocutory order appealable
as of right unless the order involves an injunction issued pursuant to two
explicit provisions of the Divorce Code or the order is in the form of a decree
nisi.[3]” Wynnewood Development, Inc. v. Bank and Trust Co. of Old
York Road, 711 A.2d 1003, 1005 (Pa. 1998) (emphasis added).
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v. Pa. Dep't. of Banking, 948 A.2d 790, 798 (Pa. 2008). The
effect of the rescission is to eliminate waiver for failure to take an
immediate appeal from such an order. A party aggrieved by an
interlocutory order granting or denying a declaratory judgment,
where the order satisfies the criteria for “finality” under
Pennsylvania Bankers Association, may elect to proceed under
Pa.R.A.P 311(a)(8) or wait until the end of the case and proceed
under subparagraph (b)(1) of [Rule 341].
Pa.R.A.P. 341, Note.
3“A decree nisi is a ‘provisional decree, which will be made absolute on motion
unless cause be shown against it.’” Wynnewood Development, Inc. v.
Bank and Trust Co. of Old York Road, 711 A.2d 1003, 1005 n.5 (Pa. 1998)
(quoting Black’s Law Dictionary (6th Ed.) at 411.). Rule 311(a)(4) “was
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Additional Defendants argue the October 12, 2018 order “did not direct
Benchmark to do anything . . . when it denied the motion for judgment on the
pleadings” and that by ordering Benchmark to defend in its January 7, 2019
order, the court imposed “an injunction which was appealable as of right[.]
Reply Brief of Appellant, at 11.
These assertions are factually inaccurate and legally inapposite. Judge
Cordaro’s October 12, 2018 order expressly refers the parties “to this [c]ourt’s
accompanying opinion[.]” Order, 10/12/18, at 2. That opinion clearly states,
“Benchmark . . . has a duty to defend Brownsville against the underlying
complaint filed by . . . Sardinia-Garcia.” Opinion, 10/12/18, at 20. Moreover,
neither Additional Defendants nor Brownsville requested injunctive relief;4 this
alone is dispositive. See Brief in Support of Additional Defendants’ Motion for
Judgment on the Pleadings, 6/20/18, at 1, 5 (asserting “Benchmark does not
have a duty to defend or indemnify Brownsville” in action to obtain declaratory
judgment); see also Wynnewood Development, Inc., supra at 1005
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amended in 2009 to eliminate references to decrees nisi but maintain the
same result.” Thomas A. Robinson Family Limited Partnership v. Bioni,
178 A.3d 839, 846 (Pa. Super. 2017); see also Pa.R.A.P. 311, Note
(explaining 2009 amendment).
4 Declaratory relief is distinct from preliminary or permanent injunctions,
forms of equitable relief with distinct requirements. See, e.g., WellsSpan
Health v. Bayliss, 869 A.2d 990, 995 (Pa. Super. 2005) (outlining
requirements for preliminary and permanent injunctions).
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(requiring “order refusing a request for an injunction” to qualify as
interlocutory appeal as of right under Rule 311(a)(4)).
What Additional Defendants deem an injunction is properly cognizable
as the court exercising its inherent authority to enforce its own orders. See
Davin v. Davin, 842 A.2d 469, 472 (Pa. Super. 2004) (“It is axiomatic that
a court must have the power to enforce its own orders.”). Additional
Defendants cite to no authority in support of the proposition that Rule
311(a)(4) can be satisfied by anything other than an order resolving an
injunction. See Reply Brief of Appellant, at 10–13. Consequently, they have
raised claims from an unappealable order over which we lack jurisdiction. See
Angelicho, supra at 1050 (quashing appeal for improperly invoking Rule
311).
Motion to quash granted.5
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5 As we are without jurisdiction, we are unable to resolve Additional
Defendants’ claims. We, however, note for Additional Defendants the
difference between an insurer’s duty to defend and its duty to indemnify. The
duty to defend arises where “a claim potentially may be one which is within
the scope of [a] policy[.]” Cadwallader v. New Amsterdam Cas. Co., 152
A.2d 484, 488 (Pa. 1959); see also Selective Way Ins. Co. v. Hospitality
Group Services, Inc. 119 A.3d 1035, 1046 (Pa. Super. 2015) (“The duty to
defend persists until an insurer can limit the claims such that coverage is
impossible.”) (emphasis added). The duty to indemnify “arises only when the
insured is determined to be liable for damages within the coverage of the
policy.” Selective Way Ins. Co., supra at 1046. The trial court determined
Additional Defendants failed to show “any evidence that [] Sardinia-Garcia]
was not an employee[.]” Trial Court Opinion, 10/12/18, at 18. This ruling
merely underscores that coverage, under the instant circumstances, is not
impossible. See Selective Way Ins. Co., supra at 1046.
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Judge Shogan joins the Memorandum.
Judge Olson concurs in the result.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 12/17/2019
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