PMA v. Aetna: Straight From The Horse’s Mouth: PMA’s Lawyer Still At It Nearly 60 Years Later

PMA v. Aetna: Straight From The Horse’s Mouth: PMA’s Lawyer Still At It Nearly 60 Years Later

As mentioned in the July 23rd issue of Coverage Opinions, the Pennsylvania Supreme Court’s 1967 decision in PMA v. Aetna, [enhanced version available to lexis.com subscribers], has long-been a controversial one. The decision holds that the Employer’s Liability exclusion (even when it says employee of “the” insured and not “any” insured; and there is a separation of insureds clause) precludes coverage for all insureds, even if the injured plaintiff is not an employee of the insured seeking coverage.

Because it is a Pennsylvania Supreme Court decision, Keystone State courts have been required to follow it, notwithstanding rumblings that they would have ruled differently if writing on a clean slate. Despite all of the debate surrounding PMA v. Aetna, this near-60 year old decision has never been revisited by the Pennsylvania Supreme Court. Until now.

On June 20, the Pennsylvania Supreme Court, [enhanced version available to lexis.com subscribers], agreed to hear an appeal in Mutual Benefit Ins. Co. v. Politopoulos, where the Superior Court, constrained to follow the PMA decision, dealt with its displeasure with it by distinguishing it, [enhanced version available to lexis.com subscribers]. In general, the court did so based on what it saw as a difference in the separation of interests clause.

PMA was long-ago represented in its case with Aetna by an attorney named Joe Foster, including arguing it before the Pennsylvania high court. Joe Foster worked for a law firm named White and Williams. Nearly 60 years later, Joe Foster still works for a law firm named White and Williams. I see Joe in the office on a regular basis and we often talk about PMA. [Joe likes to give people nicknames. He calls me Manny.]

Joe takes pride in having been involved – and on the winning side – in one of Pennsylvania’s most important coverage cases. He also takes pride in how long PMA has stood the test of time. As for the “PMA issue” headed to the Supreme Court for the first time since LBJ was in the White House and gas was $0.33 a gallon, Joe told me this: “PMA was correctly decided and I hope that the Pennsylvania Supreme Court recognizes that.”

Below is Randy's original post on the case from last month.

Pennsylvania Supreme Court To Revisit PMA v. Aetna After Nearly 60 Years

If you practice coverage law in Pennsylvania then you are familiar with the “PMA issue.” You have to be. And even if you are not regularly in Pennsylvania you may also have come across it. In very general terms, insurers have long-cited to the Pennsylvania Supreme Court’s 1967 decision in PMA v. Aetna to maintain that the Employer’s Liability exclusion (even when it says employee of “the” insured and not “any” insured; and there is a separation of insureds clause) precludes coverage for all insureds, even if the injured plaintiff is not an employee of the insured seeking coverage.

PMA v. Aetna has been a controversial decision. Nonetheless, because it is a Pennsylvania Supreme Court decision, courts have been required to follow it, notwithstanding rumblings that they would have ruled differently if writing on a clean slate. Despite all of the debate surrounding PMA, this near-60 year old decision has never been revisited by the Pennsylvania Supreme Court. Until now.

On June 20, the Pennsylvania Supreme Court agreed to hear an appeal in Mutual Benefit Ins. Co. v. Politopoulos, where the Superior Court, constrained to follow PMA, dealt with its displeasure with the decision by distinguishing it. The Pennsylvania Supreme Court granted the insurer’s Petition for Allowance of Appeal and agreed to answer the following question: “Whether the Superior Court properly ruled that Pennsylvania Manufacturers’ Association Insurance Co. v. Aetna Casualty & Surety Insurance Co., 426 Pa. 453, 233 A.2d 548 (1967) (“PMA”) did not control in the instant case because of the divergence in wording between the ‘severability clause’ in PMA and the language in the Umbrella Policy here, finding that the plain unambiguous language in the case at hand provides coverage for the liability in question.”

Coverage Opinions is a bi-weekly (or more frequently) electronic newsletter reporting or providing commentary on just-issued decisions from courts nationally addressing insurance coverage disputes. Coverage Opinions focuses on decisions that concern numerous issues under commercial general liability and professional liability insurance policies. For more information visit www.coverageopinions.info.

The views expressed herein are solely those of the author and not necessarily those of his firm or its clients. The information contained herein shall not be considered legal advice. You are advised to consult with an attorney concerning how any of the issues addressed herein may apply to your own situation. Coverage Opinions is gluten free but may contain peanut products.

    Randy Maniloff is Counsel at White and Williams, LLP in Philadelphia. He previously served as a firm Partner for seven years and transitioned to a Counsel position to pursue certain writing projects including Coverage Opinions . Nonetheless he still maintains a full-time practice at the firm. Randy concentrates his practice in the representation of insurers in coverage disputes over primary and excess obligations under a host of policies, including commercial general liability and various professional liability policies, such as public official’s, law enforcement, educator’s, media, computer technology, architects and engineers, lawyers, real estate agents, community associations, environmental contractors, Indian tribes and several others. Randy has significant experience in coverage for environmental damage and toxic torts, liquor liability and construction defect, including additional insured and contractual indemnity issues. Randy is co-author of “General Liability Insurance Coverage - Key Issues In Every State” (Oxford University Press, 2nd Edition, 2012). For the past twelve years Randy has published a year-end article that addresses the ten most significant insurance coverage decisions of the year completed.

Read more from this issue of Coverage Opinions.

For more information about LexisNexis products and solutions connect with us through our corporate site