holding that under Pennsylvania law, written waivers are subject to the general law of contracts
How later courts described this case
- holding that under Pennsylvania law, written waivers are subject to the general law of contracts
- where release did not identify appellee insurance company as a party being discharged from claims, the only reasonable interpretation of the release was that the insured did not intend to release insurance company from its contractual obligations
- policy defined “underinsured vehicle” as one with minimum liability coverage required by law but where such is less than the limit of underinsurance coverage carried by insured
- "We conclude that in the absence of unequivocal language to the contrary, a general release of a third party tortfeasor will not be held to discharge the separate contractual obligation of an insurance carrier to provide underinsurance benefits.”
Written by the judges who cited it.
Distinguished
Distinguished by Barnes v. Ream, 50 Pa. D. & C.3d 538 (1988)
The issue before the Sparler court is distinguishable in that plaintiff was seeking to institute subsequent action against his own insurance company for under-insured benefits, not seeking additional recovery from the same party..
The opinion
POPOVICH, Judge,
concurring:
I concur only in the result, for I believe the Majority has gone astray in its analysis.
The scope of contractual accountability has been recently expounded upon by our Supreme Court in Standard Venetian Blind Co. v. American Empire Ins. Co., 503 Pa. 300 , 469 A.2d 563 (1983). There, the high court unequivocally wrote that where the terms of an agreement are clear, precise and free from doubt, the signators are bound by its language.
Instantly, Sparler signed a release, in exchange for $25,-000 received from a third party tortfeasor, which contained language exonerating not only the third party from further liability but insulated “all other persons, firms and corporations” from exposure because of the execution of the release.
Sparler, being a party to the agreement, could have very easily deleted the language which precipitated the instant declaratory judgment. His failure to excise the wording is now being condoned and viewed with favor by this Court as *610 a mere adoption of a position espoused by two of our sister states distinguishing contractual liability from tortious liability as the foundation for holding the insurer liable because of not being a party to or a beneficiary of the agreement. But for the conclusion that the insurer’s set-off clause rendering payment to the plaintiff unnecessary, the insurer would be held responsible for payment.
I find the issue to be a straightforward one. The contract signed by Sparler is not unenforceable because of either a latent or patent ambiguity. Nor is there an allegation that a mistake of fact induced the plaintiff to sign the instrument in question.
To side-step the obligations flowing from the contract, in the face of an otherwise lucid agreement, would be contrary to established principles of contract law requiring that an individual be bound by the terms of an agreement, i.e., pacta sunt servanta. Restatement (Second) of the Law of Contracts, Vol. 2, at page 309; Standard Venetian Blind, supra.
Moreover, the Majority’s approach to giving effect to the release, save for the verbiage relating to “firms and corporations” being insulated from further liability, is the equivalent of giving only partial effect to the terms of the entire agreement and renders the quoted language pure surplus-age. There is no indication that such was the intent of the plaintiff. To do so is mere speculation and surmise.
If a portion of the release is to be neutralized on the ground that it was not the intent of the plaintiff to excuse the insurer from responsibility for paying a claim filed by the plaintiff following the signing of a release, then such a rationale carried to its logical conclusion should hold the entire agreement invalid and not merely portions of it.
To this writer, the agreement contains verbiage which encompasses the insurer and, thus, should be given its clear, unambiguous and lucid meaning. Resorting to the intent of the parties is only necessary where the language to the agreement is ambiguous and subject to multiple interpretations. See Corbin on Contracts § 538.
*611 Further, the Majority attempts to avoid the obvious consequences of the release by arguing that the insurer was not a party to its terms and, therefore, should not be considered to have been a beneficiary of the release. However, the insured’s ability to subrogate the claim would be precluded by the release signed by Sparler, an interest which surely would not be advanced by our holding this day, and is ameliorated only by the fact that Sparler’s recovery under the release forecloses his recoupment of any additional monies from the insurer because of a set-off clause in the policy.
Thus, given the Majority’s ultimate ruling denying the claimant’s right to recovery on grounds of set-off under the contract itself, with which I agree, I concur in the result only.