Opinion
J-A34035-12 No. 421 MDA 2012
06-26-2013
MUTUAL BENEFIT INSURANCE COMPANY Appellee v. CHRISTOS POLITOPOULAS AND DIONYSIOS MIHALOPOULAS AND MARINA DENOVITZ Appellants
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
Appeal from the Order Entered February 2, 2012
In the Court of Common Pleas of Lancaster County
Civil Division at No(s): CI-10-022578
BEFORE: BOWES, J., OLSON, J., and WECHT, J. MEMORANDUM BY WECHT, J.:
Marina Denovitz (with Christos Politopoulas and Dionysios Mihalopoulas, "Appellants") challenges the trial court's February 2, 2012 order granting summary judgment to Mutual Benefit Insurance Company ("Insurer"). In granting Insurer's motion for summary judgment, the trial court determined that it was bound by our Supreme Court's decision in Pennsylvania Manufacturers' Association Insurance Co. v. Aetna Casualty and Surety Insurance Co., 233 A.2d 548 (Pa. 1967) (hereinafter "PMA"). In so doing, however, the trial court opined that PMA was flawed, and was at odds with subsequent decisions of this Court. We disagree with the trial court's view that PMA controls this case. Thus, we reverse.
Christos Politopoulas and Dionysios Mihalopoulas, also identified herein as "Owners," are captioned herein collectively with Denovitz as Appellants. Yet, they self-identify as Appellees on the cover of their brief. Because they argue in support of reversal, and because this is consistent with their status as parties to this action in light of the trial court's ruling, we treat Owners as appellants.
The trial court has related the factual and procedural background of the case as follows:
On June 6, 2005, [Owners] purchased commercial real property located at 365 West Main Street in Leola, Pennsylvania, (the "Property") from Leola Associates, L.P. The Property includes a business known as Leola Family Restaurant. [Owners] then created Leola Restaurant Corporation of which they are officers ("Employer"). (New Matter, ¶ 37-39.) [Employer] was created to run the day-to-day operations of the restaurant.Trial Court Opinion ("T.C.O."), 2/2/2012, at 3. Disapproving of PMA, but finding that PMA controlled this case, the trial court granted Insurer's motion for summary judgment. This appeal followed.
On the same date, Owners entered into a written agreement in which they leased the Property to Employer ("Lease"). (Compl. Ex. E.) The Lease required Employer to name Owners as additional insureds on Employer's liability insurance. (Compl. Ex. E ¶ 1(d).)
On December 5, 2007, [Denovitz] was employed by Employer working at Leola Family Restaurant. (Compl. Ex. A ¶ 3.) Denovitz was walking down a flight of stairs taking trash to an outdoor trash containment area when the stairs became loose and she fell to the ground. (Compl. Ex. A ¶ 5.) As a result of the fall, Denovitz claims she sustained physical injury including a torn rotator cuff. (Compl. Ex. A ¶ 6.) On September 24, 2009, Denovitz filed a suit against Owners for their alleged negligent maintenance of the Property ("Denovitz action".) (Compl. Ex. A.)
Owners sought coverage for this claim from [Insurer] under two insurance policies issued by [Insurer] to Employer. The first policy was a Business Owners Policy, and the second was a Commercial Umbrella Policy [("Umbrella Policy")]. (Compl. Exs. B, C.) By letter dated December 4, 2009, [Insurer] disclaimed coverage under both policies. (Compl. Ex. D.) In the letter, [Insurer] asserted that Owners did not qualify as insureds under the Business Owners Policy, and although Owners qualified as insureds under the [Umbrella Policy], the Employers'
Liability Exclusion endorsement[ ] excluded any coverage under that policy. (Compl. Ex. D.) By letter dated February 23, 2010, [Insurer] advised Owners that it had withdrawn its disclaimer of coverage and agreed to defend Owners in the Denovitz action with a reservation of its right to disclaim coverage in the future and seek a judicial determination that no coverage was owed. (Compl. Ex. F.)
On March 12, 2010, [Insurer] filed suit in the Court of Common Pleas of Lancaster County seeking a declaratory judgment that it owed no coverage to Owners under either policy. After the pleadings were closed, [Insurer] filed a Motion for Judgment on the Pleadings. On December 27, 2010, [the trial court] granted [Insurer's] Motion as to the Business Owners Policy but denied its Motion as to the [Umbrella Policy].
On September 23, 2011, [Insurer] filed a Motion for Summary Judgment seeking to eliminate coverage under the Umbrella Policy. In its Motion, [Insurer] claims that Summary Judgment is appropriate since the term "insured" under the Umbrella Policy includes . . . Employer and therefore, the Employers' Liability Exclusion precludes coverage to all insureds, including . . . Owners.
This endorsement excludes coverage for:
1. An "employee" of the insured arising out of and in the course of:
a. Employment by the insured; or
b. Performing duties related to the conduct of the insured's business . . . .
In conformity with the requirements of Pa.R.A.P. 1925(b), with which the trial court and Appellant Denovitz have complied in full, the trial court issued an opinion on March 20, 2012, incorporating by reference its prior February 2, 2012 opinion. It is upon this opinion that we rely in reviewing the trial court's reasoning and disposition.
Before we analyze both the trial court's reasons for disagreeing with the PMA decision and the parties' arguments, we take note of the requisite background principles governing our review. The trial court correctly stated the principles that apply to summary judgment, as follows:
Summary judgment is appropriate only when "there is no issue of any material fact as to a necessary element of the cause of action." Pa.R.C.P. 1035.2(1). The record, including the pleadings and depositions, "must be viewed in the light most favorable to the non-moving party." Davis v. Pennzoil, 264 A.2d 597, 601 (Pa. 1970). All doubts regarding the existence of a material issue must be resolved in favor of denying the Motion for Summary Judgment. Id.T.C.O. at 3 (citations modified). We have delineated our standard of review as follows:
Upon appellate review, we are not bound by the trial court's conclusions of law, but may reach our own conclusions. In reviewing a grant of summary judgment, [we] may disturb the trial court's order only upon an error of law or an abuse of discretion. The scope of review is plenary and the appellate court applies the same standard for summary judgment as the trial court.Grandelli v. Methodist Hosp., 777 A.2d 1138, 1144 (Pa. Super. 2001) (quoting McCarthy v. Dan LePore & Sons Co., Inc., 724 A.2d 938, 940-41 (Pa. Super. 1998)).
If the language of an insurance policy is clear and unambiguous, that contract must be construed consistently with its plain and ordinary meaning. Travelers Cas. & Sur. Co. v. Castegnaro, 772 A.2d 456, 459 (Pa. 2001). The trial court correctly stated the following additional principles:
[A]ny ambiguities in an insurance contract must be resolved in favor of the insured. Coppola v. Ins. Placement Facility of Penna., 563 A.2d 134, 136 (Pa. 1989) (citing Standard Venetian Blind Co. v. Amer. Empire Ins., 469 A.2d 563, 566 (Pa. 1983)). It is equally well-settled that "[n]o word in a contract is to be treated as surplusage or redundant if any reasonable meaning consistent with the other parts can be given to it." General Mills Inc. v. Snavely, 199 A.2d 540, 544 (Pa. 1964) (citing Morris v. Am. Liab. & Sur. Co., 195 A. 201, 202 (Pa. 1936)). Words are to be interpreted in their normal meaning, unless doing so would be contrary to a clearly expressed public policy. Allstate Fire & Cas. Ins. Co. v. Hymes, 29 A.3d 1169, 1172 (Pa. Super. 2011) (quoting Prudential Prop. & Cas. Ins. Co. v. Colbert, 913 A.2d 747, 750 (Pa. 2002)).T.C.O. at 6-7 (citations modified).
As noted, in granting Insurer's motion for summary judgment, the trial court felt bound to rely upon our Supreme Court's decision in PMA. In that case, PMA insured Harry B. Niehaus, Jr., pursuant to an automobile injury liability policy as well as a workers' compensation policy. 233 A.2d at 549. Aetna, in turn, insured Delaware Wool Scouring Company ("Delaware") under a bodily injury policy. An employee of Niehaus drove a Niehaus truck to Delaware's facility. There, Niehaus's employee was injured by a Delaware employee using a Delaware forklift. The Niehaus auto policy undisputedly insured Delaware pursuant to an "omnibus clause." Id. An omnibus clause, common to automobile insurance policies, typically extends coverage to anyone who uses the insured vehicle with the permission of the named insured. Patton v. Patton, 198 A.2d 578, 582 (Pa. 1964) (quoting Appleman, Insurance Law & Practice, vol. 7, § 4354, at 243) ("An omnibus clause creates liability insurance not only for the benefit of the named insured, but also for the benefit of those who come under the clause and meet[] its requirements . . . ."). However, although the parties did not dispute Delaware's status as an omnibus insured under the PMA policy, PMA maintained that Delaware was subject to the liability exclusion provision barring insurance for injuries to Niehaus's employee. PMA, 233 A.2d at 550. That exclusion provided that coverage would not apply "to bodily injury * * * of any employee of the insured." Id. at 550 (quoting the policy, emphasis omitted).
In disputing this question, the parties relied on competing interpretations of the definition of "insured" under the PMA policy. The policy defined an insured, in relevant part, as follows: "Definition of insured (a): With respect to the insurance for bodily injury liability * * * the unqualified word 'insured' includes the named insured." Id. (quoting the policy). This dispute, in turn, was informed by the parties' divergent views of the definition's interplay with the "severability of interest" clause, which provided that "the term 'the insured' is used severally and not collectively." Id. (quoting the policy).
Our Supreme Court affirmed the lower court's determination that the PMA policy's employee exclusion excluded coverage not just for PMA but also for Delaware. In so reasoning, the Court found that nothing in the severability of interests clause vitiated the effect of the policy's definition of "the insured." The Court rejected the proposition that the severability of interest clause warranted reading "the insured," as used in the employee exclusion, as "the insured being sued." More specifically, the Court effectively refused to hold that the severability of interests clause excluded consideration of the fact that the injured party was an employee of the named insured, but not of Delaware. Rather, because Delaware qualified as an "insured" under the policy's definition, by operation of the omnibus clause, the status of the injured party as Niehaus's employee had to be imputed to Delaware, thus excluding coverage for Delaware for the same reason as it was excluded for Niehaus. Id. at 550-51.
In determining that PMA controlled the case at bar, the trial court here focused upon the definition of "insured" under the Umbrella Policy, which is materially similar to the definition at issue in PMA. T.C.O. at 5-6, 10. Although the court did not elaborate in detail why it believed that PMA controlled, instead dedicating most of its analysis to explaining its disagreement with PMA, the obvious inference is that the trial court found that the severability of interests clause could not vitiate the conclusion forced upon the court by the Umbrella Policy's definition of "the insured" - just as the Supreme Court found in PMA.
Notably, before concluding that PMA controlled this matter, the trial court opined that "the reasoning and analysis in PMA is flawed." T.C.O. at 6. In explaining its basis for so concluding, the trial court contrasted PMA with this Court's decisions in Maravich v. Aetna Life & Casualty Co., 504 A.2d 896 (Pa. Super. 1985), and McAllister v. Millville Mutual Insurance Co., 640 A.2d 1283 (Pa. Super. 1994). In Maravich, Aetna provided a fire insurance policy to David and Donna Maravich. David intentionally set fire to the insured residence, and Donna sought coverage. A policy exclusion eliminated coverage for a loss resulting from "neglect of the insured . . . to save and preserve the property." Maravich, 504 A.2d at 905-06. The policy in question did not specify whether the co-insureds were insured jointly or severally. Focusing upon the language of the exclusion, this Court determined that the term "neglect by the insured" excluded coverage only for the insured who was responsible for the fire, not for any other insureds under the policy. Id. at 904 (emphasis added). Accordingly, Donna was entitled to coverage. Id. at 906-08.
Conversely, in McAllister, the policy excluded coverage for "a loss which results from acts committed by or at the direction of an insured." 640 A.2d at 1285 (emphasis added). Unlike in Maravich, the policy in McAllister contained a "severability of interests" clause purporting to render the coverage several rather than joint. Id. at 1289. Nonetheless, this Court concluded that the use of an indefinite article (i.e., "an insured") rather than a definite article (i.e., "the insured") in the exclusion unambiguously rendered the operation of the exclusion joint rather than several. Consequently, an act by any one insured excluded from coverage by the operative provision excluded coverage jointly as to all insureds. Id.
The trial court in this case found that, "despite PMA, [Pennsylvania] appellate courts have not hesitated to examine and apply the precise policy language employed even if it is only the difference between 'any' or 'an' insured and 'the' insured." T.C.O. at 8 (citing Kundahl v. Erie Ins. Grp., 703 A.2d 542, 543-44 (Pa. Super. 1997); General Acc. Ins. Co. of Am. V. Allen, 708 A.2d 828, 832 (Pa. Super. 1998)). Turning to the policy at issue in this case, the trial court observed that, under the policy's severability clause, "the interests and coverage of [Owners] are severable from those of [Employer]." Id. Specifically, the policy, under "Separation of Insureds," provides as follows:
Except with respect to the Limit of Insurance, and any rights or duties specifically assigned to the first named insured, this insurance applies:Umbrella Policy at 11 ¶14 (emphasis in original).
a. As if each named insured were the only named insured; and
b. Separately to each insured against whom claim is made or suit is brought.
Thus, the trial court reasoned that the precise language of the Employers' Liability Exclusion endorsement ("Employers' Exclusion") ought to dictate whether coverage for Owners, as Employer's co-insured, should be barred. Id. The court noted that the Employers' Exclusion twice referred to "the insured" rather than "an" insured or "any" insured. Thus, the trial court concluded that, if the Maravich/McAllister paradigm applied, the Employers' Exclusion was materially identical to that in Maravich, entitling Owners to coverage. Id. at 8-9. The court further opined that, if such a result was not dictated under a plain language analysis, then the Umbrella Policy's use of the definite article rendered the policy ambiguous; as such, it should be interpreted in favor of Owners. Id. at 9 (citing Coppola, 563 A.2d at 136).
Having analyzed this case under the Maravich/McAllister paradigm, and having determined that, pursuant to that approach, Owners should be entitled to coverage, the trial court nonetheless concluded that PMA overshadowed those cases and dictated the contrary result: "[D]espite [the trial court's] belief that the Supreme Court's analysis in PMA is flawed and outdated, [the court] must nonetheless apply it in the instant case." Id. at 10. Thus, the trial court entered summary judgment against Owners and in favor of Insurer.
On appeal to this Court, Denovitz raises the following issues:
1. Whether the Court committed an error of law in granting the Motion for Summary Judgment of [Insurer] as to the . . . Umbrella Policy when the Employers' Liability Exclusion is ambiguous and should be interpreted in favor of [Appellant]?Brief for Denovitz at 2. Owners restate precisely the same questions, and propose the same answers as those urged upon us by Denovitz. Brief for Owners at 1 (unnumbered).
2. Whether the Pennsylvania Supreme Court decision in [ PMA ]should be overturned or reinterpreted in light of subsequent case law?
At the outset, we categorically must reject Appellants' invitation to this Court to "overturn or reinterpret" PMA, a decision that has stood for over forty-five years. We have no more authority than the trial court to overturn a prior decision of the Pennsylvania Supreme Court. See Walnut St. Assoc., Inc., v. Brokerage Concepts, Inc., 20 A.3d 468, 480 (Pa. 2011) ("It is beyond peradventure that the Superior Court must follow [the Supreme] Court's mandates, and it generally lacks the authority to determine that [the Supreme] Court's decisions are no longer controlling."). While we may interpret PMA, analogize it, harmonize it, or distinguish it - in a word, apply it (or decline to do so) consistently with sound principles of stare decisis - we may not "reinterpret it" in a way that confounds the decision itself. See Behers v. Unemployment Comp. Bd. of Review, 842 A.2d 359, 367 (Pa. 2004) ("We caution the courts below that their task is to effectuate the decisional law of this Court, not to restrict it through curtailed readings of controlling authority."). Thus, if we determine, as did the trial court, that PMA controls, we must rule in Insurer's favor independently of our opinion as to the soundness of that decision. If PMA controls, Appellants' reliance upon this Court's subsequent precedent, like their reliance upon policy considerations or criticism or contrary rules offered by other jurisdictions, necessarily is unavailing. In matters of Pennsylvania law, we serve only one master.
With that constraint in mind, we turn to those of Appellants' arguments that are justiciable - to wit, the determination of whether the trial court erred as a matter of law or abused its discretion in its interpretation of the meaning and effect of the Umbrella Policy. See Grandelli, 777 A.2d at 1144. In essence, Appellants argue that we should deem the policy ambiguous in this case based upon the Employers' Exclusion's use of the definite article. In support of this aspect of their argument - and indeed in support of their argument that we should abrogate PMA - Appellants rely exclusively upon this Court's decisions in Maravich and McAllister. Brief for Appellants at 6-7. Because the Umbrella Policy employed the definite article in tandem with a severability clause, Appellants maintain, Maravich should control.
Denovitz's brief argument is supplemented in this case by the lengthier discussion provided by amicus curiae Pennsylvania Association for Justice ("PAJ"), which relies in particular upon this Court's decision in Luko v. Lloyd's London, 573 A.2d 1139 (Pa. Super. 1990). Brief for PAJ at 9-12. In Luko, a longshoreman was employed by Independent Pier Company ("IPC"). In the course of his duties, he was injured when he fell through a defective dock on the premises of Independent Terminal Company ("ITC"), a distinct entity. At the time, both IPC and ITC were named insureds under each of two applicable policies. The Pennsylvania Insurance Guaranty Association, standing in place of one of the two insurers, which had become insolvent, argued that neither IPC nor ITC was covered under the policy at issue due to an employee exclusion materially identical to the Employers' Exclusion at issue in this case. 573 A.2d at 1140.
PAJ also relies upon a decision of the Court of Common Pleas of Allegheny County that attempted to harmonize PMA and Luko, applying the latter to the case before it. Brief for PAJ at 10-12. The decisions of the courts of common pleas do not bind this Court. See Goddard v. Heintzelman, 875 A.2d 1119, 1121 (Pa. Super. 2005). Accordingly, we gauge only Luko 's effect on this case in light of PMA, if any.
This Court disagreed. We acknowledged that the policy contained a plain-language employee exclusion, but we noted that the policy was modified by an equally clear special endorsement to the policy. That endorsement provided that the "persons insured" provision was "amended to include any employee of the named insured while acting within the scope of his duties as such." Id. at 1144. Thus, IPC and ITC were covered for Luko's injuries under the policy.
In dicta, we opined that the same result would have obtained as a consequence of the policy's severability provision. Under the standard contract, we noted, the employee exclusion would exclude coverage for IPC, because Luko was an employee of that entity. However, by operation of the severability clause, ITC would retain coverage because ITC was not Luko's employer; Luko worked for IPC. Id. at 1144. However, as dicta, our comments in this regard lacked any precedential force and effect, Hunsberger v. Bender, 180 A.2d 4, 6 (Pa. 1962), even if that case could be reconciled with PMA. Put simply, Luko by itself cannot protect Appellants from the application of PMA in favor of Insurer.
However, having rejected the main thrust of Appellants' argument, we nevertheless believe that Appellants must prevail based upon the plain language of the Umbrella Policy, which diverges materially from the language at issue in PMA. Extending our prior discussion of PMA, we note first that the policy at issue in PMA was a standard automobile insurance contract, albeit one covering workplace vehicle use. As such, it featured an omnibus provision, which is most commonly used in automobile insurance polices. Such a clause generally extends coverage to anyone who uses the insured vehicle with the permission of the named insured. See, e.g., Patton, 198 at 582. Thus, in PMA, the additional insured was not a "named insured," in the common-sense meaning of that term; rather, the putative insured was one who qualified as an insured under the omnibus clause. In this case, however, the Owners undisputedly were named insureds under the umbrella policy.
Although Appellants do not develop this particular argument in any detail, they clearly call into question the trial court's interpretation of the insurance contract at issue. In resolving a duly raised question of contract interpretation, we must interpret that contract as a matter of law, which subjects our review to a de novo standard of review and a plenary scope of review. See Grandelli, supra. Indeed, we cannot resolve Appellants' duly preserved and stated issue without interpreting the contract according to its terms.
To highlight one practical distinction, in this case, Owners were named insureds by agreement with Employer, presumptively in a bargained for exchange. An insured under an omnibus clause, by contrast, may not, and often probably does not, have any role in the design of the insurance contract. Rather, the omnibus clause either is included as a standard provision or is negotiated between the principal insured and the insurer.
More important, however, is the considerable divergence between the wording of the "severability clause" at issue in PMA and the parallel clause in the case sub judice, which the trial court neither acknowledged nor addressed. According to our Supreme Court in PMA, the clause in question provided that "the term 'the insured' is used severally and not collectively," 233 A.2d at 550, a somewhat vague, if not uncommon formulation rendered still more vague in light of the fact that Delaware was insured under an omnibus clause rather than as a named insured.
In this case, the Umbrella Policy's severability clause is worded far more particularly, as follows:
14. Separation of InsuredsUmbrella Policy at 11 (emphasis in original).
Except with respect to the Limit of Insurance, and any rights or duties specifically assigned to the first named insured, this insurance applies:
a. As if each named insured were the only named insured; and
b. Separately to each insured against whom claim is made or suit is brought.
While this is not inconsistent with a severance clause indicating that coverage applies severally to numerous insureds rather than jointly, it speaks with greater precision. Moreover, by way of defining the scope and application of the policy as among the named insureds, it prescribes a clear heuristic that governs the policy's application: When determining coverage as to any one insured, the policy must be applied as though there were only one insured, i.e., the one as to which coverage is to be determined. Moreover, neither the heading nor the content of the provision so much as uses the word "several" or any variant thereof: Instead, it uses the words "separation" and "separately." Notably, the legal definition of "several" suggests a subtle distinction between those words: "2. (Of liability, etc.) separate; particular; distinct, but not necessarily independent . . . ." Black's Law Dictionary 1378 (Deluxe 7th ed. 1999) (emphasis added). This definition resists the sort of clear separation called for by use of the word "separate," especially when viewed in the context of the unambiguous approach prescribed by the severability clause.
We emphasize that we are bound to the language of the contract. When the language of the policy is plain, we do no more than apply it precisely as stated. See Castegnaro, 772 A.2d at 459. The words of the policy should be interpreted in their normal meaning. See Hymes, 29 A.3d at 1172. Moreover, we must adopt any reasonable reading that gives effect to each provision of the policy. See General Mills, 199 A.2d at 544. Accordingly, the parties' and PAJ's emphasis on extra-jurisdictional precedent and Third Circuit federal courts' interpretations of Pennsylvania law are immaterial unless the language of the policy is not sufficiently clear to enable us to discern the meaning of the policy therefrom. This is not such a case.
See Brief for PAJ at 13-14; Brief for Insurer at 13-14; Brief for Insurer in Response to Brief for PAJ at 10-12.
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As noted, by what we read to be the plain, unambiguous language of the "Separation of Insureds" clause, we are bound to evaluate whether Owners are insured under the Umbrella Policy when they are evaluated as though they were the only named insured, an analytic conceit that appears to us both clearer and stronger than those that are implied when a severability clause simply identifies the insureds as "several" rather than "joint." Thus, in no uncertain terms, the policy language directs us to evaluate coverage as though Employer does not exist.
Informed by this conclusion, we now must turn to the Employers' Exclusion. Thereunder, coverage is excluded for "'bodily injury' . . . to . . . [a]n 'employee' of the insured arising out of and in the course of . . . [employment] by the insured; or . . . [p]erforming duties related to the conduct of the insured's business." The parties do not dispute that Denovitz was never in Owners' employ. Were we to follow PMA in this case, we would have to impute her employee status to Owners by extension of her status vis-à-vis Employer. However, we are directed by the Umbrella Policy's plain language not to consider Employer, or Employer's relationship to Denovitz, when determining whether the policy provides coverage for Owners.
Finally, we must reject Insurer's argument that the Umbrella Policy's definition of insured precludes a finding of coverage. In this regard, the policy provides as follows:
The words you and your in this policy refer to the named insured shown in the Declarations and all other persons or organizations qualifying as named insureds under this policy. . . .Umbrella Policy at 6-7 (emphasis in original). Insurer relies upon these provisions to resist any argument that the meaning of "the insured" as used in the Employers' Exclusion renders that provision ambiguous; because the definitional section identifies as an "insured" any person or organization to which Employer agreed in writing to provide insurance, Insurer argues, the Employers' Exclusion must apply to bar coverage as to any insured when the liability stems from an injury to an employee of any other insured. Brief for Insurer at 9-12.
The word insured means any person or organization qualifying as such under SECTION III - WHO IS AN INSURED . . . .
* * * *
SECTION III - WHO IS AN INSURED
1. If you are designated in the Declarations as:
* * * *
c. Any organization other than a partnership or joint venture, you are an insured. Your executive officers and directors are insureds, but only with respect to their duties as your officers or directors . . . .
* * * *
f. Any person or organization with whom you have agreed in writing prior to any occurrence or offense to provide insurance such as is afforded by this policy, but only with respect to operations performed by you or on your behalf, or facilities owned or used by you.
Simply put, we cannot discern, nor does Insurer offer, any reason to find these definitions inconsistent with our reading of the severability clause, or our ruling as to its effect in tandem with the Employers' Exclusion. There is no dispute that Owners are insureds under the Umbrella Policy. However, nothing in these definitions precludes us from adhering to the requirement that, when evaluating coverage, we treat each insured as though no other insured exists. An insured who does not exist cannot employ anyone. Thus, if the person injured is not employed by the lone insured as to whom coverage is to be tested, the Employers' Exclusion simply does not come into play. This does not violate any aspect of the definitional section of the Umbrella Policy, and hence does not run afoul of our interpretive principles.
Accordingly, we must conclude that Owners were covered under the Umbrella Policy for the liability in question. Treated separately, as though they were the only insured under the terms of the policy, Owners did not employ Denovitz at any relevant time. Consequently, the Employers' Exclusion had no effect on Owners.
Before concluding, we pause to note that the Umbrella Policy so construed dovetails neatly with the exclusivity of remedy for an employee against her employer under the Workers' Compensation Act. See 77 P.S. § 481. That provision precludes virtually all employer liability to an employee for workplace injury beyond that provided by the Workers' Compensation Act. It is to be expected that an umbrella policy would deny coverage for workplace injuries to an insured employer relative to the insured's employees. Cf. PMA, 233 A.2d at 551 (crediting the argument that the named insured, as an employer, "would not intend coverage for his employee" under the circumstances at bar when the employer "had already covered his employees with a workmen's compensation policy"). However, nothing in the Workers' Compensation Act suggests that the exclusivity provision precludes the liability of third parties to the employer-employee relationship (although third-party recovery does entitle the employer to subrogation of the employee's recovery). See generally Heckendorn v. Consol. R. Corp., 465 A.2d 609 (Pa. 1983). Because Owners, as lessors, foreseeably might be liable to a lessee's employee, and do not enjoy the benefit of Workers' Compensation protection, they have ample reason to seek to insure themselves against such liability.
This certainly is not to say that the parties to the Umbrella Policy could not have fashioned that policy to effectuate the result for which Insurer argues. But, when we are able to do so, we must find the intent of the parties in the plain language of the policy read as a whole. Here, we find the language of the policy clear to the effect that the Employers' Exclusion does not act to bar coverage to Owners, in light of the particular language of the severability clause. Moreover, the language we find dispositive is materially distinct from that in PMA, and it is for that reason alone - not any disagreement with, or misgivings about, the rule we can glean from PMA - that we reach today's result.
Order reversed. Case remanded. Jurisdiction relinquished.
Olson, J. concurs in the result. Judgment Entered. ______________
Deputy Prothonotary