By Kevin L. Connors, Esquire
A recent Decision by the Pennsylvania Superior Court denied a Plaintiff’s procedural challenge to an Arbitrator appointed by State Farm, the insurer for the Tortfeasor sued by the Plaintiff in a negligence action, with the Arbitrator having been selected by State Farm as one of three Members of an Arbitration Panel that ultimately rendered an unanimous award in favor of State Farm and against the Plaintiff.
The Superior Court Decision was in State Farm Mutual Insurance Company v. Dill, decided by the Pennsylvania Superior Court on January 13, 2015.
The Plaintiff was injured in a motor vehicle accident. She was an 11 year old passenger being driven to School.
Injured in the accident, she filed a personal injury lawsuit against the driver of the striking vehicle.
That driver was insured by State Farm.
State Farm assigned the case to attorney Kevin McNulty, familiar to our firm as an excellent insurance defense attorney, and a friend of the firm.
Kevin entered his Appearance, and filed an Answer to the Complaint. He then withdrew his Appearance, with one of his Partners, Dan Lewbart, also a friend of the firm, entering his Appearance.
The Plaintiff’s negligence lawsuit then settled against the Tortfeasor for its policy limits. After the Third-Party case settled, the Plaintiff filed an underinsured motorist claim against State Farm.
Consistent with the insurance policy, the underinsured motorist claim then proceeded to Arbitration, with State Farm appointing McNulty as its Defense Arbitrator, with the Plaintiff appointing a Plaintiff Arbitrator, and the Arbitrators agreeing on a Neutral Arbitrator.
The underinsured motorist Arbitration Panel then rendered a unanimous Award in favor of State Farm, denying the Plaintiff’s claim for underinsured motorist benefits.
The Plaintiff then filed a Motion to Strike or Set Aside the Arbitration Award, alleging that she had not received a fair Arbitration Hearing, due to McNulty’s prior involvement in the underlying Third-Party personal injury lawsuit.
The Trial Court denied the Plaintiff’s Motion, with the Plaintiff then appealing the Trial Court’s denial of her Motion to the Superior Court.
Holding that the Plaintiff had failed to properly object to McNulty’s appointment and participation as an Arbitrator in the underinsured motorist Arbitration, the Superior Court denied the Plaintiff’s Appeal, holding that participants in an Arbitration are obligated to raise objections to the composition of the Arbitration Panel at the earliest possible time, with the Court ruling that the Plaintiff’s failure to object to McNulty’s participation as an Arbitrator resulted in a waiver of her capacity to object to his service as a Defense Arbitrator.
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