J-A26024-15


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

ROX-ANN REIFER,                                  IN THE SUPERIOR COURT OF
                                                       PENNSYLVANIA
                            Appellant

                       v.

WESTPORT INSURANCE COMPANY,

                            Appellee                  No. 321 MDA 2015


                Appeal from the Order Entered January 20, 2015
              in the Court of Common Pleas of Lackawanna County
                        Civil Division at No.: 2012-01410


BEFORE: FORD ELLIOTT, P.J.E., WECHT, J., and PLATT, J.*

MEMORANDUM BY PLATT, J.:                        FILED NOVEMBER 20, 2015

        Appellant, Rox-Ann Reifer, appeals from the order sustaining the

preliminary objections of Appellee, Westport Insurance Company, and

dismissing her complaint with prejudice. We affirm.

        The trial court succinctly set forth the background of this case in its

January 20, 2015 opinion.

              This case originally stems from a legal malpractice lawsuit
        commenced by [Appellant] against Donald Russo (“Russo”).
        [Appellant] originally filed a writ of summons against Russo on
        March 18, 2008 and served Russo with the writ of summons the
        following day.    However, Russo did not report the writ to
        [Appellee, his legal malpractice insurer]. On December 29,
        2008, [Appellant] filed a complaint against Russo for legal
        malpractice, and served a copy on Russo. Russo reported the
        complaint to [Appellee], but his policy with [Appellee] had
____________________________________________


*
    Retired Senior Judge assigned to the Superior Court.
J-A26024-15


       expired on August 15, 2008. Therefore, because the report was
       [made] sixty days after the expiration of the [policy], [Appellee]
       denied coverage for the claim.

             On February 11, 2011, [Appellant] and Russo reached a
       settlement, with Russo admitting liability but leaving a jury to
       decide the amount of damages to be awarded and assigning his
       rights under the policy to [Appellant].           A jury awarded
       [Appellant] a judgment against Russo totaling over $4 million
       dollars [for his negligent representation of her in an employment
       related action].

             On March 1, 2012, [Appellant] filed [a declaratory
       judgment] action [against Appellee] in [the trial court].
       [Appellee] removed the action to federal district court based on
       diversity jurisdiction. The federal district court remanded the
       case back to [the trial c]ourt based on its discretionary authority
       to decline jurisdiction over actions seeking a declaratory
       judgment.

             On remand, [Appellee] filed [p]reliminary [o]bjections to
       [Appellant’s c]omplaint, seeking to have [Appellant’s c]omplaint
       dismissed due to the legal insufficiency of the pleading based on
       the fact that [Appellant’s] underlying malpractice claim was not
       reported to [Appellee] during the policy period or within sixty
       (60) days thereafter as required by the policy agreement. . . .

(Trial Court Opinion, 1/20/15, at 1-2).

       On January 20, 2015, the trial court sustained Appellee’s preliminary

objections, and dismissed Appellant’s complaint with prejudice.       Appellant

timely appealed on February 13, 2015.1 On August 7, 2015, Appellant filed

an application for relief entitled “Appellant’s Response to [Appellee’s]



____________________________________________


1
  The trial court did not order Appellant to file a Rule 1925(b) statement of
errors, and did not file a Rule 1925(a) opinion. See Pa.R.A.P. 1925.



                                           -2-
J-A26024-15


Demand to Withdraw an Argument in her Reply Brief,” which we deferred

until disposition of her appeal in a September 4, 2014 per curiam order.

       Appellant raises three questions for our review:

       I.   Did the Supreme Court promulgate [Rule of Professional
       Conduct] 1.4(c) to protect consumers of legal services[?]

       II.   Is Brakeman’s[2] and Vanderhoff’s[3] notice-prejudice
       rule the best way to effectuate the Supreme Court’s intent in
       promulgating [Rule of Professional Conduct] 1.4(c)[?]

       III. Do public policy considerations support reversal of the
       [trial] court’s decision [sic] and the application to their notice
       prejudice rule[?]

(Appellant’s Brief, at 4) (most capitalization omitted).

       Although her questions involved are not properly phrased as such, a

review of Appellant’s brief as a whole reveals that she claims the trial court

erred in sustaining Appellee’s preliminary objections on the basis of the

insurance policy’s unambiguous terms without interpreting it pursuant to her

arguments. (See id. at 4, 13). In effect, Appellant raises one issue, and

advances three arguments in support of it. (See id. at 13, 16-37).

       We first consider whether the trial court erred in sustaining Appellee’s

preliminary objections on the basis of the insurance contract’s terms. (See

Trial Ct. Op., at 3).

____________________________________________


2
    Brakeman v. Potomac Ins. Co., 371 A.2d 193 (Pa. 1977).
3
  Vanderhoff v. Harleysville Ins. Co., 997 A.2d 328 (Pa. 2010).
Vanderhoff applied the rule announced in Brakeman. See id. at 333-34.



                                           -3-
J-A26024-15


     Our standard of review of this matter is well-settled:

            [O]ur standard of review of an order of the trial court
     overruling or granting preliminary objections is to determine
     whether the trial court committed an error of law.        When
     considering the appropriateness of a ruling on preliminary
     objections, the appellate court must apply the same standard as
     the trial court.

            Preliminary objections in the nature of a demurrer test the
     legal sufficiency of the complaint. When considering preliminary
     objections, all material facts set forth in the challenged pleadings
     are admitted as true, as well as all inferences reasonably
     deducible therefrom.      Preliminary objections which seek the
     dismissal of a cause of action should be sustained only in cases
     in which it is clear and free from doubt that the pleader will be
     unable to prove facts legally sufficient to establish the right to
     relief. If any doubt exists as to whether a demurrer should be
     sustained, it should be resolved in favor of overruling the
     preliminary objections.

Richmond v. McHale, 35 A.3d 779, 783 (Pa. Super. 2012) (citation

omitted).

           The interpretation of an insurance contract is a question of
     law. The standard of review of questions of law is de novo, and
     the scope of review is plenary. Thus, in interpreting a contract,
     this Court need not defer to the trial court.

                                 *    *    *

           When the language of a policy is clear and unambiguous,
     the court is bound to give effect to the policy and cannot
     interpret the policy to mean anything other than what it says.
     The goal [of the Court in] interpreting an insurance policy . . . is
     to determine the intent of the parties as manifested by the
     language of the policy. Disputes over coverage must be
     resolved only by reference to the [ ] provisions of the
     policy itself.




                                     -4-
J-A26024-15


Clarke v. MMG Ins. Co., 100 A.3d 271, 275 (Pa. Super. 2014), appeal

denied, 117 A.3d 294 (Pa. 2015) (citations and quotation marks omitted)

(emphasis added).

        In this case, the language of the professional liability policy expressly

provided that the policy period was from August 15, 2007 to August 15,

2008.     (See Customized Practice Coverage Declarations, 8/29/07, at 1).

Pursuant to Russo’s liability coverage:

        [Appellee] shall pay on behalf of [Russo] all LOSS . . . which
        [Russo] becomes legally obligated to pay as a result of CLAIMS
        first made against [Russo] during the POLICY PERIOD and
        reported to [Appellee] in writing during the POLICY
        PERIOD or within sixty (60) days thereafter[.]

(Professional Liability Coverage, at 1 ¶ 1A) (emphasis added).4

        Therefore, because “the language . . . is clear and unambiguous, the

court [was] bound to give effect to [it] and [could not] interpret the policy to

mean anything other than what it says.” Clarke, supra at 275 (citation and

internal quotation marks omitted).             In fact, Appellant does not argue that

the policy’s terms were ambiguous or that Russo provided Appellee with

timely notice. (See Appellant’s Brief, at 16-34). She actually concedes that



____________________________________________


4
  This type of insurance policy is a claims-made policy, which “protects the
holder only against claims made during the life of the policy.”
Consulting Engineers, Inc. v. Ins. Co. of N. Am., 710 A.2d 82, 85 (Pa.
Super. 1998), affirmed, 743 A.2d 911 (Pa. 2000) (citation omitted)
(emphasis added).



                                           -5-
J-A26024-15


Russo failed to provide timely notice of her malpractice claim to Appellee.

(See id. at 13).

        Hence, we conclude that the trial court properly sustained Appellee’s

preliminary objections on the basis of the insurance contract’s clear and

unambiguous language and found that Appellant’s declaratory judgment

action is legally insufficient where, pursuant to the policy’s terms, Appellee is

not liable.    (See Trial Ct. Op., at 3); see also Clarke, supra at 275;

Richmond, supra at 783.             Appellant’s appeal of the trial court’s order

sustaining Appellee’s preliminary objections and dismissing her complaint

with prejudice does not merit relief.

        Moreover, we are not legally persuaded by the arguments Appellant

makes in support of her “issues.” (See Appellant’s Brief, at 4, 16-34).

        In her first argument, Appellant maintains that the claims-made policy

contravenes the Pennsylvania Supreme Court’s intent to protect consumers

with the promulgation of Pennsylvania Rule of Professional Conduct 1.4(c).5


____________________________________________


5
    Pennsylvania Rule of Professional Conduct 1.4(c) provides:

               A lawyer in private practice shall inform a new client in
        writing if the lawyer does not have professional liability
        insurance of at least $100,000 per occurrence and $300,000 in
        the aggregate per year, subject to commercially reasonable
        deductibles, retention or co-insurance, and shall inform existing
        clients in writing at any time the lawyer’s professional liability
        insurance drops below either of those amounts or the lawyer’s
        professional liability insurance is terminated. A lawyer shall
(Footnote Continued Next Page)


                                           -6-
J-A26024-15


(See Appellant’s Brief, at 13-14, 16-26).6 Specifically, Appellant argues that

claims-made policies like Appellee’s nullify the protection afforded by Rule

1.4(c) because, even if an attorney maintains insurance coverage pursuant

to the Rule while representing a client, “if the negligent attorney report[s]

[a] claim one minute after the notice period expire[s], there would be no

coverage.” (Appellant’s Brief, at 19).

      However, our Supreme Court has not held that claims-made policies

are a violation of its intent in promulgating Rule 1.4(c), and, “[a]s an

intermediate appellate court, we do not enunciate new precepts of law or

expand existing legal doctrines, since that province is reserved to our

Supreme Court.” Mountain Properties, Inc. v. Tyler Hill Realty Corp.,

767 A.2d 1096, 1100 (Pa. Super. 2001), appeal denied, 782 A.2d 547 (Pa.

2001) (citations omitted).         Therefore, we decline Appellant’s invitation to

declare Appellee’s claims-made insurance policy void on this basis.

      In her second argument, Appellant argues that the notice-prejudice

requirement of Brakeman should be extended to claims-made policies, and,


                       _______________________
(Footnote Continued)

      maintain a record of these disclosures for six years after the
      termination of the representation of a client.

Pa.R.P.C. 1.4(c).
6
  Appellant’s issue raises a question of law. Therefore, our scope of review
is plenary. See Krepps v. Snyder, 112 A.3d 1246, 1251 (Pa. Super.
2015), appeal denied, 2015 WL 5437445 (Pa. filed Aug. 31, 2015).



                                            -7-
J-A26024-15


therefore, to the policy herein.               (See Appellant’s Brief, at 26-28).

Appellant’s argument lacks merit.

       Brakeman involved an occurrence,7 not a claims-made, policy, and

held in the occurrence policy context, “where an insurance company seeks to

be relieved of its obligations under a liability insurance policy on the ground

of late notice, the insurance company will be required to prove that the

notice provision was in fact breached and that the breach resulted in

prejudice to its position.” Brakeman, supra at 198.

       However, a panel of this Court has already expressly declined “to

extend the Brakeman rule to claims-made insurance policies” and held

“that in the ‘claims-made’ context, if an insured has clearly breached the

notice requirement, an insurer need not show prejudice to deny coverage.”

ACE Am. Ins. Co. v. Underwriters at Lloyds and Cos., 939 A.2d 935,

941 (Pa. Super. 2007), affirmed, 971 A.2d 1121 (Pa. 2009).             Appellant’s

argument that we find otherwise is not legally persuasive.

       Finally, the public policy arguments in Appellant’s third claim do not

merit relief. (See Appellant’s Brief, at 28-34).

       We observe that:

             [W]hen     the    question   is   one    of   contract
       interpretation, public policy arguments are irrelevant.
       Public policy concerns are always secondary to the clear and
____________________________________________


7
  An occurrence policy “protects the policy holder from liability for any act
done while the policy is in effect[.]” Consulting Engineers, supra at 85.



                                           -8-
J-A26024-15


      unambiguous [terms of a] contract, which must be given its
      plain meaning. . . . Courts are bound to give effect to clear
      contractual terms and only examine public policy when
      enforcement of those terms would be contrary to a clearly
      expressed public policy.

Clarke, supra at 278 (citations and quotation marks omitted) (emphasis

added).

      Here, Appellant argues that Appellee’s policy violates public policy

because it is a contract of adhesion and its “late notice provisions constitute

a   prohibited   unreasonable   forfeiture.”     (Appellant’s   Brief,   at   31

(capitalization omitted); see id. at 30-32).     However, Appellant fails to

provide evidence in support of these claims other than her recitation of

alleged facts, or to identify any pertinent caselaw that contains “a clearly

expressed public policy” against the enforcement of claims-made insurance

policies.   Clarke, supra at 278 (citation omitted); (see also Appellant’s

Brief, at 28-34); Pa.R.A.P. 2119(a)-(b).        Therefore, Appellant’s third

argument is not legally persuasive.




                                      -9-
J-A26024-15


        Order affirmed.8

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 11/20/2015




____________________________________________


8
    We deny Appellant’s Application for Relief filed on August 7, 2015 as moot.



                                          - 10 -
