J. A10007/17
                             2017 PA Super 297



SAFE AUTO INSURANCE COMPANY              :    IN THE SUPERIOR COURT OF
                                         :          PENNSYLVANIA
                   v.                    :
                                         :
RENE ORIENTAL-GUILLERMO,                 :
RACHEL DIXON, PRISCILA JIMENEZ,          :
LUIS JIMENEZ, ALLI LICONA AVILA          :
AND IRIS VELAZQUEZ                       :
                                         :         No. 3226 EDA 2016
APPEAL OF: PRISCILA JIMENEZ &            :
LUIS JIMENEZ                             :


            Appeal from the Order Entered September 13, 2016,
              in the Court of Common Pleas of Lehigh County
                      Civil Division at No. 2015-C-1547


BEFORE: DUBOW, J., SOLANO, J., AND FORD ELLIOTT, P.J.E.


DISSENTING OPINION BY FORD ELLIOTT, P.J.E.:FILED SEPTEMBER 18, 2017

      I respectfully dissent. I believe that the MVFRL was never intended to

abandon those who are injured using Pennsylvania highways for the

protection of an automobile insurer’s bottom line. While it is correct that the

MVFRL was enacted to address the high cost of insurance in this

Commonwealth which skyrocketed under the former No-Fault Act, I do not

believe that it was ever the intent of the legislature to enact a system in

which low-cost, low-coverage insurance effectively makes for no insurance
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at all.1   Automobile insurance companies come into Pennsylvania, register,

and aggressively compete for business. The fact that all vehicles operated

on our highways must be insured has something to do with that. I believe

the MVFRL serves a dual purpose to both lower the cost of insurance, which

in turn allows those who operate a vehicle to afford to do so, all in

furtherance of protecting victims who are injured due to the operation of

those vehicles. Broad coverage exclusions which eliminate these protections

should not be enforceable. The insurer is in a much better position to accept

the risk related to its insured than is the innocent injured victim.

      When the legislature amended Section 1786(f) in 1990, it specifically

expanded the breadth of financial responsibility for owners of motor vehicles.

In Progressive Northern Ins. Co. v. Universal Underwriters Ins. Co.,

898 A.2d 1116 (Pa.Super. 2006), appeal denied, 909 A.2d 1290 (Pa.

2006), we set forth the following:

             The 1990 amendments added subsection (f) to
             § 1786 to provide:

                   Any owner of a motor vehicle for which
                   the existence of financial responsibility is
                   a requirement for its legal operation shall
                   not operate the motor vehicle or permit
                   it to be operated upon a highway of


1
  See, e.g., An v. Victoria Fire & Cas. Co., 113 A.3d 1283, 1289-1290
(Pa.Super. 2015), appeal denied, 130 A.3d 1285 (Pa. 2015) (upholding a
“named driver only” exclusion in a policy described as a “low-cost express
product,” which excluded liability coverage for any person not listed as a
named driver on the policy in exchange for “substantially reduced
premiums”).


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                this Commonwealth without the financial
                responsibility required by this chapter.

          75 Pa.C.S.A. § 1786(f) (emphasis added).          This
          added provision alters the former § 1786
          significantly. Where the pre–1990 provision required
          only that each motor vehicle registrant certify the
          registrant’s financial responsibility, § 1786 now
          speaks directly about the necessity of ensuring
          coverage for each operated motor vehicle. Further,
          § 1786 now also directly states that financial
          responsibility is required when another operates the
          owner’s vehicle with permission. Thus, contrary to
          Universal’s position, the relevant provisions of the
          MVFRL did set forth material changes which make
          the analysis offered in [State Farm Mut. Auto. Ins.
          v. Universal Underwriters Ins. Co., 701 A.2d
          1330 (Pa. 1997)] inapplicable. In addition, we find
          that the language set forth in the 1990 version of the
          MVFRL suggests a contrary result to that reached in
          State Farm.[2]

          Admittedly, the MVFRL continues not to include
          specific language directing that all permissive users
          of a vehicle be insured under the owner’s insurance.
          However we find that the changes to § 1786
          implicitly direct that such coverage be provided.

2
          The court [in State Farm] considered the
          [pre-1990] language of § 1786 which provided “that
          each motor vehicle registrant shall certify that he
          has provided ‘financial responsibility’ at the time he
          registers his vehicle.” [State Farm, 701 A.2d at
          1333] (citing 75 Pa.C.S.A. § 1786).          The court
          rejected the proposition that all permissive users
          would have to be insured under the owner’s policy to
          be in compliance with § 1786. It noted that § 1786
          “is utterly silent as to whom the coverage of the
          owner’s policy runs.” Id. The court reasoned that
          such language could not be read as a mandate
          requiring insured drivers using another’s vehicle with
          permission to be insured under the owner’s policy.

Progressive v. Universal, 898 A.2d at 1118-1119.


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            Subsection (f) speaks directly about requiring
            financial responsibility for vehicles which are being
            operated on the highways of this Commonwealth by
            owners or by others who have the owner’s
            permission to operate their vehicle. This language
            supports this Court’s statement that “[t]he
            requirements of the Motor Vehicle Financial
            Responsibility Law . . . are consistent with the
            concept that primary coverage follows ownership of
            the vehicle.”    Nationwide Ins. Co. v. Horace
            Mann Ins. Co., 759 A.2d 9, 13 n.3 (Pa.Super.
            2000). Thus, our reading of the MVFRL causes us to
            agree with the trial court that the legislature has
            provided clear indication that vehicle owners must
            provide coverage to vehicles they own and operate
            or permit others to operate. Accordingly, we uphold
            the trial court’s ruling finding that McNeely, while
            using the Young Volkswagen vehicle with permission,
            was an insured under the Universal policy.

Id. at 1119. See also Allstate Ins. Co. v. Tokio Marine & Nichido Fire

Ins. Co., Ltd., 464 F.Supp.2d 452, 460-461 (E.D.Pa. 2006) (“[T]he MVFRL

requires that all other vehicle owners maintain active financial responsibility

on their vehicles at all times and that all permissive users of a vehicle be

insured under the owner’s insurance.” (footnote omitted)); Lebanon Coach

Co. v. Carolina Cas. Ins. Co., 675 A.2d 279, 284 (Pa.Super. 1996),

appeal denied, 687 A.2d 378 (Pa. 1997) (“Under Pennsylvania’s [MVFRL],

the vehicle’s owner or registrant is responsible for maintaining financial

responsibility for the vehicle. See [75] Pa.C.S.A. § 1786. It is the vehicle

that is covered by the automobile policy, while an individual is covered only




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by nature of his function as the driver of that vehicle.” (footnotes and

citation omitted; emphasis in original)).3

      I am still of the belief that the legislature intended the insurance to

follow the vehicle and did not intend that policies covering a vehicle could or

should be limited by who is operating the vehicle. Section 1718(c) affords

protection to both an insurer and an insured to exclude specific individuals

whose risk of driving the vehicle is too high, both in cost of coverage and

risk of injury to others.   Absent this specific enactment, the exclusion of

particular classes of drivers not specifically provided under the MVFRL clearly

flies in the face of the legislative intent of the 1990 amendments to the

MVFRL.

      The Majority adopts the trial court’s interpretation that Section 1786(f)

“places the obligation on the owner of a vehicle, and not the insurance

company, to ensure that anyone who drives the owner’s car has insurance.”

(Majority Memorandum at 8.) According to the Majority, an owner of a car

should only permit another person to drive his car if that driver has his own

insurance.     The   Majority   posits   that   any   other   interpretation   of



3
  The policy exclusion at issue here provided that Safe Auto is not liable for
damages that occur “while your covered auto is being operated by a resident
of your household or by a regular user of your covered auto, unless that
person is listed as an additional driver on the Declarations Page.” Therefore,
the insured could give permission to a total stranger to drive his car and that
person would be covered, whereas his live-in fiancée is not. This incongruity
suggests to me that even Safe Auto believed when it drafted the policy
language that it could not exclude all permissive users under the MVFRL.


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Section 1786(f) unfairly shifts the risk to insurance companies to insure

unidentified individuals who might have access to an insured’s vehicle. (Id.

at 9, 12.)

      However, in my mind, Section 1786 simply mandates that owners of

motor vehicles have insurance. See Cangemi v. Com., Dept. of Transp.,

Bureau of Driver Licensing, 8 A.3d 393, 400-401 (Pa.Cmwlth. 2010) (“In

enacting the MVFRL, the Legislature intended to provide a minimal level of

compensation for victims of motor vehicle accidents.                  To ensure this

compensation, the Legislature placed the burden on the owner or registrant

of a vehicle to insure his or her vehicle and imposed penalties for the failure

to do so. 75 Pa.C.S.[A.] §§ 1786(d)(1), (f). This policy choice is reasonable

because the owner or registrant of a vehicle is in a better position to

guarantee that the vehicle has insurance than a driver who is granted

permission to borrow the vehicle.” (citation omitted)). I believe that the trial

court’s interpretation, adopted by the Majority, runs counter to this court’s

holding in Progressive v. Universal that Section 1786(f) of the MVFRL

implicitly directs that all permissive users of a vehicle be insured under the

owner’s insurance. But for the unlisted resident driver exclusion in this case,

that would include Rachel Dixon, the insured’s live-in fiancée, who was

indisputably   a   permissive   user   of     the   covered   vehicle.     Compare

Nationwide Mut. Ins. Co. v. Cummings, 652 A.2d 1338 (Pa.Super.

1994),   appeal     denied,     659    A.2d    988    (Pa.    1995)    (upholding   a



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“non-permissive use” policy exclusion where the uninsured claimant was a

passenger in a stolen vehicle).

      Additionally, regarding the oft-repeated rubric that cost containment

was the overarching policy concern of the MVFRL, appellants aptly point to

the concurring Opinions in Williams v. GEICO, 32 A.3d 1195, 1200 (Pa.

2011), in support of their argument that the Pennsylvania Supreme Court

has signaled a willingness to depart from prior pronouncements using cost

control to validate all manner of policy exclusions. (Appellants’ brief at 13.)

Appellants are correct that a four-member majority of our supreme court, as

constituted at that time, expressed their concern regarding cost control as

the overriding goal of the MVFRL. See Williams, 32 A.3d at 1211 (“I join

my colleagues in calling for advocates and the judiciary to cease their

continued reliance on the unthinking perpetuation of the long-ameliorated

concern for cost containment”) (Baer, J., concurring); id. at 1213 (“I join

those Justices who eschew the mantra of cost containment -- used by

various courts to rotely limit the rights of insureds -- in favor of a recognition

of other equally important policies and goals that are foundational to the

MVFRL, such as the remedial objectives of the statute and the coverage

rights of insureds”) (Todd, J., concurring).       See also Heller v. Penn.

League of Cities and Municipalities, 32 A.3d 1213, 1222 (Pa. 2011)

(“Despite our repeated affirmance of the cost containment policy underlying

the MVFRL, we have cautioned that it has limits. While the enactment of the



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MVFRL grew out of a legislative concern for the ‘spiraling’ costs of

automobile     insurance,   the   cost    containment        objective     cannot    be

mechanically invoked as a justification for every contractual provision that

restricts coverage and purportedly lessens the cost of insurance.” (citation

omitted)).

      Besides cost containment, it is beyond cavil that another, equally

important goal of the MVFRL is to protect Pennsylvania motorists from

uninsured/underinsured      drivers   and       to   expand     coverage.           See

Kmonk-Sullivan v. State Farm Mut. Auto. Ins. Co., 746 A.2d 1118, 1123

(Pa.Super. 1999), affirmed, 788 A.2d 955 (Pa. 2001) (“The policy of

liberally construing the MVFRL is based upon the policy of indemnifying

victims of accidents for harm they suffer on Pennsylvania highways.”

(citation    omitted));   Cummings,       652    A.2d   at    1342       (“Two   major

considerations that prompted the repeal of the No-Fault Act and the

enactment of the MVFRL were the escalating costs of purchasing motor

vehicle insurance and the increasing numbers of uninsured motorists.                 In

order to fulfill its purposes, the MVFRL established a recovery scheme that

sets out minimum amounts of coverage that must be offered to the insured.”

(citations omitted)). I believe enforcement of Safe Auto’s unlisted resident

driver/regular user policy exclusion is not only contrary to Section 1786(f) of

the MVFRL, which requires that permissive users be covered under the

owner’s insurance, but also very possibly contrary to public policy.



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     I respectfully dissent.




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