author: NEALON, J.,

text:
    Hall v. MPH Transportation Inc.

      C.P. of Lackawanna County,
    no. 00-CV-2612.

      John R. Lenahan Jr. and Gregory A. Germain, for plaintiffs.

      William G. Cilingin, for defendant, MHP Transportation Inc.

      James A. Doherty, for defendant Joseph.
    May 1, 2002
   NEALON, J.,

The Pennsylvania Property and Casualty Insurance Guaranty Association has filed a petition to open a default judgment that was entered against defendant, Albert W. Joseph, on January 19,2001. PIGA contends that 40 PS. §991.1819(b) grants it an “automatic right” to open default judgments regardless of the timeliness of its petition to open or the legitimacy of the excuse for the initial default. Although PIGA has an absolute right under section 1819(b) to set aside any default judgment that was entered against an insurer while it was in rehabilitation or receivership and unable to defend its insured, PIGA’s qualified ability to open default judgments that were entered while the insurer was solvent and capable of filing a responsive pleading is subject to the criteria which customarily govern the opening of default judgments. Since more than four months elapsed between the time that the insurer received notice of the default judgment and the date that it was placed into rehabilitation, and PIGA delayed an additional 41 days before it filed the petition to open, neither PIGA nor the defaulting defendant has established that the petition to open was promptly filed under Pennsylvania law. Therefore, the petition to open the default judgment will be denied.

I. FACTUAL BACKGROUND

On May 30, 2000, plaintiffs, Adina Hall and Albert W. Joseph, commenced this litigation pursuant to the Wrongful Death and Survival Acts, 42 Pa.C.S. §§8301-8302, based upon an incident which allegedly occurred on May 30, 1999, on Interstate Route 40 in Brownsville, Tennessee. On the date of the accident, Albert was reportedly operating a tractor-trailer as an agent of defendant, MPH Transportation Inc. d/b/a MPH Inc., while his wife, Carolyn Y. Joseph, was a passenger in the tractor cab. As a result of Albert’s alleged negligence, his wife fell from the moving tractor and died from multiple head trauma on May 31,1999. (See plaintiffs’ complaint, ¶¶5-11.)

In their original complaint, Adina and Albert named MPH and Albert as defendants. Albert was personally served with the complaint on June 28, 2000, and after the complaint was reinstated on June 29, 2000 and July 28, 2000, MPH was likewise served with initial process on August 15, 2000. Reliance Insurance Company insured MPH under a commercial general liability and commercial truckers policy (see petition to open default judgment, ¶5), and retained counsel to defend MPH’s interests in this litigation. On August 28, 2000, the firm of Mintzer, Sarowitz, Zeris & Ledva entered its appearance as counsel for MPH. However, Reliance Insurance Company neglected to secure counsel for NTH’s agent, Albert.

Consequently, by letter dated October 30,2000, Albert advised Reliance of the pendency of this lawsuit against him and requested that it furnish him with a defense. Albert’s correspondence was received by Reliance at its Lake Mary, Florida, office on November 3, 2000. (See petition to open, exhibit B, p. 1.) On November 7,2000, Reliance’s claims handling office in Orlando, Florida, forwarded a letter to Albert indicating that it could not locate a claim and requesting that Albert provide “more details of this loss.” (Id., exhibit C, p. 1.) At that time, Reliance did not deny coverage for Albert nor did it offer to defend his interests pursuant to a reservation of rights.

On January 4, 2001, counsel for plaintiffs filed a 10-day notice of an intent to enter a default judgment against Albert for failing to answer the complaint that had been served on June 28, 2000. Plaintiffs’ 10-day notice was forwarded to Albert via certified mail, and as reflected by the certified mail return receipt, that notice was received by him on January 5, 2001. On January 9, 2001, Albert forwarded a certified letter to Reliance enclosing a copy of the 10-day notice of intent to enter a default judgment and renewing his request that Reliance provide counsel to represent him in this case. (Id., exhibit B, p. 2.) Although Albert’s correspondence was admittedly received by Reliance, it took no action to protect his rights or otherwise oppose the impending entry of a default judgment.

In the absence of any responsive pleading by Albert or his counsel, a default judgment was entered against Albert on January 19,2001. By certified letter dated January 21, 2001, Albert transmitted a copy of the default judgment to Reliance. (Id., p. 3.) Once again, Reliance failed to furnish Albert with a defense. Despite the fact that Reliance had secured counsel for MPH and was actively defending this death case, it forwarded a form letter to Albert on January 26, 2001, in which it returned Albert’s “correspondence because we cannot identify it as relating to any of our claims from the information provided.” (Id., exhibit C, p. 2.) In response, Albert mailed yet another certified letter to Reliance on February 7, 2001, in which he stated:

“I have received your letter dated January 26, 2001.1 am resending to you copies of the letters I had sent to you already on October 30, 2000, January 9, 2001, and January 21,2001.1 do not understand why you are sending this back to me. The papers I sent you had the information you are asking for, but I am sending this to you again.

“The accident happened on May 31,1999. The claimant is the estate of Carolyn Joseph, address R.R. 3, Rt. 6, Bx 3599, Factoryville, PA 18419. Her SS no. is [ XXX-XX-XXXX ]. Reliance provided truckers insurance which covers me through MPH Inc. MPH’s address is 436 Spruce Street, Scranton, Pennsylvania.

“I am again requesting again that you provide me with proper representation in this matter.

“I do not know why you claim to need this, but I found out that your claim number is 082 99 54112 146. The policy number is SK3005209.” (Id., exhibit B, pp. 4-5.)

On February 14,2001, Reliance responded to Albert’s request by returning his correspondence in another form letter in which it asserted that it could not identify it as related to one of Reliance’s claims. Reliance’s letter of February 14, 2001, was identical to its earlier standard-i ized note dated January 26,2001, with the exception that the latter correspondence included a post-script stating “[t]his claim is not handled in this office. Please send all correspondence to Reliance Insurance, 620 Freedom Business Center Dr., King of Prussia, PA 19406.” (Id., exhibit D, p. 2.) In reply, Albert mailed a handwritten note that was received by Reliance’s Valley Forge claims office on February 20,2001, and in which he stated “here are more documents forwarded to me. I don’t understand why you are not providing me with legal counsel. I have asked over and over. However, again your claim no. is 0829954112146 and policy no. is SK3005209.” (Id., p. 1.) Nevertheless, Reliance again failed to provide Albert with legal representation and neglected to make any effort to timely petition the court to open the default judgment which had been entered against him on January 19, 2001.

On March 7,2001, Judge Trish Corbett severed plaintiffs’ defaulted claims against Albert from those contested claims which were pending against MPH. By memorandum and order dated March 16, 2001, Judge Carmen D. Minora denied MPH’s preliminary objections that had been submitted by the Mintzer firm. On April 5, 2001, plaintiffs filed a “motion to amend reflecting substitution of administrator of the estate of Carolyn Y. Joseph,” and on that same date, Judge Minora issued an order directing “that the caption in this matter is amended to substitute John. M. Lanza as co-administrator of the estate of Carolyn Y. Joseph in place of plaintiff, Albert W. Joseph.” On May 8, 2001, counsel for the plaintiffs circulated a certificate of readiness with respect to the severed claims against Albert and advised Albert of the intention to file the sanae within 15 days pursuant to Lacka. Co. R.C.P. 214(a). (See plaintiffs’ brief in opposition, exhibit E.)-

On May 15, 2001, Reliance forwarded a letter to Albert advising him that it had “recently been informed” that Albert had been “served with suit papers” in this action. (Id., exhibit D.) Reliance further advised Albert that it was providing him with a defense “pursuant to a full reservation of rights” since it “seriously doubt[ed] whether [Albert was] entitled to a defense or indemnity under the Reliance pobey issued to MPH____” (Id., p. 1.) Throughout its reservation of rights letter, Reliance repeatedly stated that “[c]overage does not exist” because Albert is “not an insured under the Rebanee pobey,” the wrongful death claim “does not fall within the insuri rig agreement or is precluded by one of the policy exclusions,” and Albert had breached the suit notice provision of the pobey by allegedly neglecting to notify Rebanee of the lawsuit until February 20, 2001. (Id., pp. 6-7,11-13.)

On May 23,2001, counsel for plaintiffs filed a certificate of readiness to have plaintiffs’ defaulted claims against Albert scheduled for a non-jury trial on damages. As of that date, no attorney had yet to enter an appearance to defend Albert’s interests in this litigation. In addition, no rehabilitation proceeding had been initiated against Reliance during the seven-month period between the time that Albert first notified Reliance about the lawsuit and the date that plaintiffs certified the defaulted claims for trial.

More than four months after the entry of the default judgment, the law firm of Gibley & McWilliams PC., entered its appearance on behalf of Albert on May 29, 2001. On that same date, Reliance was placed into rehabilitation by the Pennsylvania Insurance Commissioner and all actions involving Reliance were stayed. (See petition to open, ¶18.) Based upon the certificate of readiness that had been filed in May 2001, the court administrator scheduled a non-jury trial on damages against Albert for September 2001, but that bench trial was postponed due to the Commonwealth Court stay order. On December 28, 2001, the Commonwealth Court granted PIGA’s petition to intervene in Koken, supra, and issued a 30-day stay “from January 2, 2002, through February 1, 2002, in all proceedings in which Reliance Insurance Company ... is obligated to defend any party in any court of this Commonwealth.” (See defendant’s brief in support, exhibit E, pp. 1-2.)

Following the expiration of that stay on February 1, 2002, PIGA promptly retained the firm of Naulty, Scariczmazza & McDevitt Ltd. to defend MPH and the Naulty firm entered its appearance as counsel for MPH on February 11, 2002. PIGA did not secure counsel for Albert until March 14,2002, at which time Albert’s current counsel of record entered his appearance in substitution for Gibley & McWilliams P.C. Albert’s new counsel contemporaneously filed the instant petition to open default judgment which was made returnable for a hearing on April 24,2002. (See letter from James A. Doherty Jr., Esquire, dated April 30, 2002, stating that “[t]he petition to open the judgment was filed immediately after said counsel received the file from PIGA.”)

PIGA asserts that “Reliance did not receive any written request or other request to defend Albert Joseph until after the default judgment had already been taken.” (See defendant’s brief in support, p. 5.) PIGA’s contention in that regard is contradicted by its own supporting exhibits which clearly document that Albert made at least two written requests for a defense and legal representation before the default judgment was entered. (Id.., exhibit B, pp. 1-2.) PIGA further contends that 40 P.S. §991.1819(b) grants it an “automatic right” to open a default judgment without having to demonstrate that (1) the petition to open was promptly filed, (2) it has a meritorious defense to plaintiffs’ claims and (3) there is a reasonable excuse for failing to answer the complaint. (Id., pp. 10-12, 15.)

Plaintiffs counter that 40 P.S. §991.1819(b) applies only to default judgments involving a “covered claim” which is defined by 40 P.S. §991.1802 as any unpaid claim “which arises out of and is within the coverage” of the insolvent insurer’s policy. Since Reliance denied coverage in its letter of May 15, 2001, and provided Albert with a defense subject to a full reservation of rights, plaintiffs submit that their claims cannot be regarded as “covered” so as to fall within the ambit of section 1819(b).

Plaintiffs further maintain that section 1819(b) merely governs default judgments entered against an insolvent insurer while it is in rehabilitation or insolvency and does not apply to default judgments that are granted while the insurer is solvent. Additionally, the plaintiffs posit that they acted in reliance upon the validity of the default judgment by severing the claims against Albert and MPH, dropping S&M Leasing Inc. as a defendant and certifying the severed action against Albert for a bench trial. Last, plaintiffs argue that PIGA cannot establish the three factors necessary for the opening of a default judgment.

PIGA filed its supporting brief on April 15,2002, and plaintiffs submitted their brief in opposition on April 23, 2002. Oral argument was conducted on April 24, 2002, and both parties presented lengthy “letter briefs” on April 25, 2002, April 30, 2002, and May 1, 2002. Following the filing of those materials, this matter was submitted for a decision.

II. DISCUSSION

(A) Criteria for Opening of Default Judgment

A petition to open a default judgment is recognized as an appeal to the equitable powers of the court. Allegheny Hydro No. 1 v. American Line Builders Inc., 722 A.2d 189, 191 (Pa. Super. 1998); Sparaney v. County of Lackawanna, 101 Lacka. Jur. 433, 435 (2000), aff’d, 785 A.2d 180 (Pa. Commw. 2001). In general, a default judgment may be opened when the moving party establishes the following three requirements: (1) a prompt filing of the petition to open the default judgment; (2) a meritorious defense to the underlying claim; and (3) a reasonable excuse or explanation for its failure to file a timely responsive pleading. Cintas Corp. v. Lee’s Cleaning Service, 549 Pa. 84, 93-94, 700 A.2d 915, 919 (1997); Dumoff v. Spencer, 754 A.2d 1280, 1281-82 (Pa. Super. 2000).

“The trial court cannot open a default judgment based upon the ‘equities’ of the case when the defendant has failed to establish all three of the required criteria.” Flynn v. Casa Di Bertacchi Corp., 449 Pa. Super. 606, 674 A.2d 1099, 1103 (1996); Castings Condominium Association Inc. v. Klein, 444 Pa. Super. 68, 77, 663 A.2d 220, 225 (1995). If the court considers the three elements identified above, it need not conduct a separate inquiry regarding the alleged prejudice to the parties since the tripartite, test constitutes the governing equitable analysis. Flynn v. American West Airlines, 742 A.2d 695, 699-700 (Pa. Super. 1999); Allegheny Hydro 1, 722 A.2d at 191-92. Accord Dumoff, 754 A.2d at 1283 (“after reviewing applicable case law regarding the untimely filing of a petition to open judgment, we find that prejudice is not a separate element examined by the courts when [defendant] did not establish all three requirements of the test to open the default judgment”). PIGA maintains that it is not required to satisfy the foregoing criteria since it possesses an absolute right to set aside default judgments under 40 PS. §991.1819(b).

(B) PIGA’s Ability To Open Default Judgment

PIGA was created by the Pennsylvania Insurance Guaranty Association Act, Act of November 25,1970, PL. 716, no. 232, §101 et seq. 40 P.S. §1701.101 et seq., which was later repealed and replaced by the Pennsylvania Property and Casualty Insurance Guaranty Association Act, Act of December 18, 1992, no. 178, §201, 40 P.S. §991.1801 et seq. S ee Ascher v. Pennsylvania Insurance Guaranty Association, 722 A.2d 1078, 1079 n.1 (Pa. Super. 1998), app. denied, 561 Pa. 650, 747 A.2d 896 (1999). Section 1801 of the Act states that it was enacted to provide a means for the payment of covered claims under policies issued by insolvent insurers, to avoid excessive delay in the payment of such claims and to avoid financial loss to claimants and insureds as a result of the insolvency of an insurer. See 40 P.S. §991.1801(1). To that end, PIGA is “[t]o be deemed the insurer to the extent of its obligation on the covered claims and, to such extent, shall have all rights, duties and obligations of the insolvent insurer as if that insurer had not become insolvent.” 40 P.S. §991.1803(b)(2). See also, UTI Corp. v. Fireman’s Fund Insurance Co., 896 F. Supp. 389, 395 (D.N.J. 1995) (PIGA “stands in the shoes” of the insolvent insurer and assumes its duties and obligations). As the Pennsylvania Supreme Court has clearly stated:

“The only limitation placed upon an injured party is that [PIGA’s] own limitations of liability apply rather than those of the insolvent insurer. Thus, by the clear and unambiguous terms of the statute, PIGA is deemed to be an insurer and is placed in the stead of the insolvent insurer, with all of that insurer’s rights and duties and obligations.” Donegal Mutual Insurance Co. v. Long, 528 Pa. 295, 300-301, 597 A.2d 1124, 1127 (1991). (emphasis added)

Under the express provisions of the Act, PIGA is empowered to settle and pay “covered claims” and to deny all other claims. Main Line Health Inc. v. Pennsylvania Medical Professional Liability Catastrophe Loss Fund, 738 A.2d 66, 70 and n.15 (Pa. Commw. 1999), aff’d, 566 Pa. 4, 111 A.2d 1048 (2001). For example, section 1803(b)(4) states that PIGA is authorized to investigate, pay and deny claims “and may review ... judgments to which the insolvent insurer or its insureds were parties to determine the extent to which such . . . judgments may be properly contested.” 40 PS. §991.1803(b)(4). Section 1819(b) of the Act addresses default judgments which have been entered against the insolvent insurer and provides:

“As to any covered claims arising from a judgment under any decision, verdict or finding based on the default of the insolvent insurer or its failure to defend an insured, the association, either on its own behalf or on behalf of such insured, may apply to have such judgment, order, decision, verdict or finding set aside by the same court that made such judgment, order, decision, verdict or finding and shall be permitted to defend against such claim on the merits.” 40 P.S. §991.1819(b). PIGA contends that the language stating that it “shall be permitted to defend against such claim on the merits” grants PIGA an unconditional right to open a default judgment without having to satisfy any of the criteria set forth in the tripartite test governing the opening of default judgments.

There are no reported decisions interpreting 40 P.S. §991.1819(b) and relatively little case law construing its verbatim predecessor, 40 P.S. §1701.602(b) (repealed). The only decisional precedent addressing PIGA’s capacity to open default judgments involves defaults that occurred while the insurer was in rehabilitation or receivership. Unfortunately, there is no appellate authority which distinctly analyzes the viability of a default judgment that was entered against an insurer prior to being placed into rehabilitation or receivership and the corresponding ability of PIGA to set aside such a pre-insolvency default judgment.

In its only reference to PIGA’s authority to challenge default judgments, the Supreme Court of Pennsylvania does not indicate whether that right is mandatory or discretionary. In support of its conclusion that PIGA “is placed in the stead of the insolvent insurer, with all of that insurer’s rights and duties and obligations,” the Long court observed that “[pjursuant to 40 P.S. §1701.602, [PIGA] is even empowered to seek a stay of proceedings and to reopen default judgments involving the insolvent insurer.” Long, supra at 301 n.14,597 A.2d at 1127 n.14. However, the Supreme Court does not elaborate whether PIGA’s ability to reopen a default judgment involving an insolvent insurer is, or is not, absolute.

The Superior Court has considered the application of 40 PS. §1701.602(b) (repealed), albeit in the context of default judgments that were entered while the insurer was in receivership. In Adler v. Huddleston, 268 Pa. Super. 163, 407 A.2d 881 (1979), the plaintiff filed an action against a defendant whose insurer was already insolvent by the time that the suit was instituted. After the defendant failed to file a timely answer, the plaintiff secured a default judgment against the unrepresented and uninsured defendant. Once PIGA assumed the defense and representation of the defendant, both parties agreed to open the default judgment. However, inasmuch as PIGA similarly failed to file a responsive pleading within the allotted time period, the default judgment was reinstated by the court. PIGA appealed and asserted that the lower court contravened section 1701.602(b) by reinstating the judgment. In summarizing PIGA’s argument, the Superior Court remarked “[t]he reasoning is that once [PIGA], in the applicable situation, decides to apply for an opening of judgment, the hearing court must provide the means for [PIGA] to defend on the merits. We disagree.” Id. at 166, 407 A.2d at 882. Finding that PIGA had been dilatory in its own right, the Adler court concluded:

“Such conduct is contrary to the prompt resolution of covered claims. We find no error in the lower court’s considered decision to revoke its prior order and to vacate the opening of judgment and reinstate the judgment. The ‘Act’ in no way hinders or limits such discretion by the court.” Id., at 167,407 A.2d at 883. Cf. McMahon v. Caravan Refrigerated Cargo Inc., 406 Pa. Super. 303, 309, 594 A.2d 349, 352 (1991) (holding PIGA responsible for a claim that resulted from a default judgment which had been entered against an insured whose carrier was later adjudicated insolvent).

In Rockwood Insurance Co. v. Piper, 440 Pa. Super. 557, 656 A.2d 510 (1995), the insurer commenced a declaratory judgment action against a defendant who subsequently filed for bankruptcy. After the insurer secured relief from the automatic stay, it neglected to prosecute the litigation diligently and was eventually declared to be insolvent. PIGA assumed the insolvent insurer’s assets and liabilities, including its ability to pursue the declaratory judgment action. However, the trial court later granted a judgment of non pros against PIGA based, in part, upon delay which was attributable to the insolvent insurer prior to its insolvency. In affirming the trial court’s denial of PIGA’s petition to reopen the judgment of non pros, the Superior Court quoted with approval the “sound rationale” of the lower court which concluded that “[i]t is obvious from this language [in the Act] that the legislature did not intend to provide PIGA with a ‘clean slate.’ ” Id., at 561, 656 A.2d at 512.

Finally, in Ascher, supra, a class action was commenced against State Auto Insurance Association to recover first party benefits under the former No-Fault Act. Once the Indiana Department of Insurance placed State Auto into receivership under the supervision of a rehabilitator, State Auto filed a motion for a stay of the class action proceedings, but “[t]his motion was subsequently denied, and counsel for State Auto was permitted to withdraw” by order of court. Nevertheless, “[t]he case proceeded to trial . . . and it is undisputed that defendant State Auto, which was then in receivership, was not represented by counsel at trial.” Ascher, 722 A.2d at 1080. Verdicts were returned in favor of each class member and the trial judge “ordered State Auto to pay $346,854 in plaintiffs’ attorneys’ fees.” Id. at 1081.

More than two years after State Auto was declared insolvent, Ascher filed another class action regarding the no-fault benefits due, but this time she named PIGA as the defendant. The trial court granted the motion for class certification and ordered PIGA to pay 18 percent interest on the earlier uncontested verdicts entered for no-fault benefits and attorneys’ fees, “excluding the period of State Auto’s receivership . . . until it was declared insolvent ....” Id. On appeal, PIGA argued that former section 1701.602(b) entitled it to challenge the unappealed verdicts that had been entered against State Auto while it was in receivership and unrepresented by counsel. In granting PIGA the opportunity to contest the verdicts, interest and fees that were awarded in absentia, the Superior Court reasoned:

“We believe that the express provisions of the PIGA Act, as well as the public policy underlying the Act, require that we vacate the judgment entered upon the jury verdict and remand to permit [PIGA] to defend against such claims on the merits....

“Thus, should PIGA be found liable for the insurance claims in the instant matter, [plaintiff] would be entitled to ‘properly assess attorneys’ fees, costs, and interest.’ ... Instantly, however, appellant PIGA was never afforded the opportunity to argue the statute of limitations defense or the alleged unreasonableness of the use of a multiplier in calculating attorneys’ fees .... Accordingly, these issues may be presented to the court upon remand.” Id., at 1084-85. (citation omitted)

What can be gleaned from this appellate precedent is that PIGA has an unqualified right to set aside any default judgment that was entered against the insolvent insurer while it was in rehabilitation or receivership and unable to defend the claim on the merits. See Ascher, supra. However, in those instances where the default occurred while the insurer was solvent and fully capable of mounting a defense, it does not appear that PIGA’s right to open the default judgment is “automatic.” Since the Superior Court has cautioned that the Act “did not intend to provide PIGA with a ‘clean slate,’ ” Piper, supra, and has rejected the argument that once PIGA “decides to apply for an opening of judgment, the hearing court must provide the means for [PIGA] to defend on the merits,” Adler, supra at 166, 407 A.2d at 882, PIGA’s proffered interpretation of section 1819(b) is not supported by existing case law.

PIGA’s contention that the Act grants it an autocratic right to open any default judgment which predates its involvement cannot be reconciled with other provisions of the Act. See Housing Authority of the County of Chester v. Pennsylvania State Civil Service Commission, 556 Pa 621, 640, 730 A.2d 935, 945 (1999) (“[i]t is axiomatic that in determining legislative intent, all sections of a statute must be read together and in conjunction with each other, and construed with reference to the entire statute”). Section 1803(b)(2) clearly states that PIGA “shall have all... duties and obligations of the insolvent insurer as if that insurer had not become insolvent.” By the time that Reliance was placed into rehabilitation on May 29,2001, it had been cognizant of the default judgment against Albert for more than four months and, consequently, had forfeited its right to open that default judgment since it neglected to promptly file a petition to open. See Allegheny Hydro, 722 A.2d at 194 (41-day delay between notice of default and filing of petition was deemed to be untimely); Castings Condominium, supra at 73,663 A.2d at 223 (three-month delay is not prompt). Prior to Reliance’s rehabilitation, plaintiffs detrimentally relied upon the enforceability of the default judgment by severing their claims, dismissing a co-defendant and certifying the severed action for trial. If PIGA is now permitted to belatedly open the default judgment without regard to the parties’ pre-rehabilitation conduct, PIGA would not assume all of Reliance’s rights and duties “as if that insurer had not become insolvent.”

It makes perfect sense for PIGA to have an unconditional right to set aside a default judgment which occurred during the insurer’s rehabilitation or insolvency and while the insurer and defendant were incapable of defending the claim on the merits. The same should not be true, however, for default judgments or verdicts that were entered at a time when the defendant and then solvent insurer had the ability to defend the claim and protect their interests. Such an interpretation is consistent with the language of section 1819(b) which refers to judgments “based on the default of the insolvent insurer” and implies that the default took place while the insurer was “insolvent” and unable “to defend an insured,” rather than when it was solvent and simply unwilling to do so. PIGA’s argument to the contrary is premised upon an unpublished memorandum opinion, Feldstein v. 7254 Castor Ave., 369 Pa. Super. 654, 531 A.2d 530 (1987) (table), which cannot be relied upon or cited for precedential value. See Commonwealth v. Phinn, 761 A.2d 176, 179-80 (Pa. Super. 2000) (citing Internal Operating Procedures of the Superior Court, §444.B), app. denied, 567 Pa. 712, 785 A.2d 89 (2001); McLafferty v. Cohen, 52 D.&C.4th 344, 349 n.8 (Phila. Cty. 2001).

Under 40 PS. §991.1819(b), PIGA inherits both the feats and sins committed by the former insurer while solvent and reaps the benefits of the insurer’s achievements, and suffers the consequences of its transgressions, during its solvency. For example, if Reliance had succeeded with MPH’s preliminary objections and secured the dismissal of certain claims, PIGA would have been entitled to enjoy the benefit of that ruling. Conversely, if plaintiffs have obtained a default judgment due to the failure of Albert and Reliance to timely answer the complaint while Reliance was still solvent, PIGA should not be granted the unfettered right to set aside that judgment at any time it chooses. If PIGA is truly, “deemed to be an insurer and is placed in the stead of the insolvent insurer, with all of that insurer’s rights and duties and obligations,” Long, supra at 301, 597 A.2d at 1127, it should not be entitled to shirk responsibility for the insurer’s conduct while it was solvent. To hold otherwise would defeat the Act’s express purpose of avoiding “excessive delay in the payment of such claims.” See 40 P.S. §991.1801(1).

Accordingly, reading all sections of the Insurance Guaranty Association Act in conjunction with each other, PIGA does not possess the “automatic” right to set aside a default judgment that was entered against a defendant at a time when the liability insurer was solvent and capable of retaining counsel to file an answer and defend the claim on the merits. Based upon the factual circumstances of this case, including Reliance’s failure to challenge the default judgment during the more than four-month hiatus between its notice of the default and subsequent entry into rehabilitation, PIGA should be treated the same as any other litigant and may set aside the default judgment at issue by satisfying the tripartite criteria discussed above.

(C) Timeliness of PIGA’s Petition To Open

The timeliness of a petition to open a default judgment is measured from the date that notice of the entry of the default judgment was received. Alba v. Urology Associates of Kingston, 409 Pa. Super. 406, 409, 598 A.2d 57, 58 (1991); Sparaney, 101 Lacka. Jur. at 436. In determining whether the petition has been promptly filed, the court does not employ a “bright line test” and instead focuses upon “(1) the length of the delay between discovery of the entry of a default judgment and filing the petition to open, and (2) the reason for the delay.” Dumoff, 754 A.2d at 1282; Allegheny Hydro, 722 A.2d at 193. If a petition to open is filed within 10 days after the entry of judgment, Pa.R.C.P. 237.3 presumes that it has been promptly filed with legitimate excuse for the delay. American West Airlines, 742 A.2d at 698 n.2; Cohen v. Mirin, 729 A.2d 1236, 1238 n.3 (Pa. Super. 1999).

In the case at bar, more than four months elapsed between the date that Reliance received notice of the default judgment and its entry into rehabilitation on May 29, 2001. See Reliance Insurance Companies v. Festa, 233 Pa. Super. 61, 64-65, 335 A.2d 400, 402 (1975) (trial court abused its discretion in opening a default judgment where there was an unexplained delay of 71 days in filing the petition to open). Furthermore, after the final stay expired on February 1,2002, PIGA itself delayed an additional 41 days before it presented the instant petition to open. The Superior Court has “held that delays of as little as 21 days have been untimely.” Dumoff, supra. Compare Casa Di Bertacchi Corp. at 612, 674 A.2d at 1102 (“[t]he trial court was generous in its conclusion that the petition was timely filed” when it was submitted 17 days after notice of the entry of default). Assuming arguendo that the nine-month period between the date of Reliance’s placement into rehabilitation on May 29,2001, and the expiration of the final stay on February 1, 2002, is excluded from consideration, PIGA’s petition to open the default judgment was nonetheless untimely. Since an interval of 41 days between notice of the default and the filing of the petition to open has been judicially recognized as untimely, see Allegheny Hydro, supra (41-day delay is not prompt), a petition to set aside the judgment was not promptly filed by either Reliance or PIGA.

Inasmuch as PIGA cannot satisfy the first prong of the tripartite test, its petition to set aside the default judgment must be denied. See Castings Condominium, supra (trial court is powerless to open a default judgment unless the defendant has established all three of the required criteria). Thus, we need not consider whether a meritorious defense exists or whether PIGA has offered a suitable explanation for the initial failure to answer the complaint. An appropriate order will follow.

ORDER

And now, May 1,2002, upon consideration of the “petition of defendant, Albert W. Joseph, to open default judgment,” the memoranda of law submitted by the parties and the oral argument of counsel on April 24, 2002, and based upon the reasoning set forth in the foregoing memorandum, it is hereby ordered and decreed that the “petition of defendant, Albert W. Joseph, to open default judgment” is denied.

      . The purported lessor of the tractor-trailer, S&M Leasing Inc., was initially named as a defendant as well, but by stipulation dated February 15, 2001, S&M Leasing Inc. was dismissed without prejudice.

      . In its petition to open, PIGA avers that a 90-day stay order was entered on May 29, 2001. (See petition to open, ¶18.) However, in Koken v. Reliance Insurance Co., 784 A.2d 209, 210-11(Pa. Commw. 2001), the Commonwealth Court indicated that a 60-day stay order was entered via paragraph 22 of its earlier order of May 29, 2001. In Koken, the Commonwealth Court extended that stay on August 2,2001, for an additional 180 days for certain cases and proceedings that were pending in the federal courts or outside the Commonwealth of Pennsylvania. Id. at 211-13. See also, Rewerts v. Reliance Insurance Co., 170 F. Supp.2d 847, 848 (C.D. Ill. 2001).

      3. The relevant footnote in the Supreme Court’s opinion reflects that the limitation of liability identified in the above quoted passage is the statutory damage cap of $300,000 per claimant, regardless of the amount of the insolvent insurer’s coverage limits set forth in its policy. See 40 P.S. §991.1803(B)(1)(8) (PIGA’s maximum obligation is “[a]n amount not exceeding $300,000 per claimant for all other covered claims.”).

      . The content of the current Act’s default judgment provision is identical to former section 1701.602(b). See Ascher, 722 A.2d at 1083 n.5. Under section 1922(4) of the Statutory Construction Act, 1 Pa.C.S. §1922(4), it is appropriate to consider judicial interpretations of an earlier version of a law in attempting to construe an existing statute. See Morrow v. Scott Twp. Bd. of Supervisors, 103 Lacka. Jur. 153, 158 n.2 (2002).


source: Caselaw Access Project

author: NANOVIC, J.,

license: Public Domain

text:
    Commonwealth v. Rose

      C.P. of Carbon County,
    nos. 217 CR 01, 218 CR 01.

      David W. Addy, assistant district attorney, for Commonwealth.

      Steven R. Serfass, county solicitor, for Carbon County.

      Kim Liz Rose, pro se.

      Joseph Miller, pro se.
    July 23, 2002
   NANOVIC, J.,

In these proceedings, the Carbon County District Attorney’s office on behalf of the Commonwealth asks the court to direct that a portion of the proceeds of forfeited bail be paid as restitution to the victim of the underlying criminal offense. Whether the court has the legal authority to direct such payment and, if so, whether the court should exercise its discretion as requested by the Commonwealth are the issues before the court.

On July 13, 2000, the defendant, Kim Liz Rose, and another individual gained entrance to the victim’s home by subterfuge with the intent of taking cash and valuables from the victim’s home. The victim is an 89-year-old female.

While in the home, the other individual distracted the victim while Rose, who pretended to use the bathroom facilities, searched the victim’s home for cash and other valuables. $4,300 in cash and $2,402 in jewelry was located and taken from the victim’s bedroom.

Rose was later identified and charged with burglary, theft by unlawful taking, theft by deception, and receiving stolen property. These charges against Rose are indexed to no. 217 CR 01. Subsequently, on December 3, 2001, Rose pled guilty to the crime of theft by unlawful taking.

At the time of the preliminary hearing before the District Justice, bail was set at $50,000 with security posted in the amount of 10 percent of the monetary condition (i.e$5,000) to obtain Rose’s release from custody. The security was posted by Joseph Miller, who also acted as surety and executed the second page of the bond. This page of the bail bond contains a confession of judgment provision authorizing the entry of judgment against the surety and in favor of the Commonwealth of Pennsylvania for use of the county for the full amount of the monetary condition of release. A receipt for the deposit was provided to Mr. Miller.

On December 3, 2001, Rose also pled guilty to the charge of criminal trespass arising out of an incident that occurred on February 14, 2001, in which Rose, Helen Kopecz, and a third individual entered the home of an elderly gentleman without permission. The defendants were apprehended before being able to obtain any property and no financial loss was sustained by the victim. This case is indexed to no. 218 CR 01. Bail for Rose in this case was previously set by the magistrate at $100,000, 10 percent cash bail. This security was also posted by Joseph Miller, who again acted as surety on the bail bond.

Sentencing for Rose in both cases was originally scheduled for January 20, 2002, and continued at the request of her counsel, to February 25, 2002. On this new date for sentencing, defendant failed to appear. On motion of the Commonwealth made at the time of the scheduled sentencing, the court issued a warrant for defendant’s arrest. By order dated February 25, 2002, defendant’s bail was revoked and bail forfeited. Written notice of the revocation and forfeiture was given to defendant and her surety on May 14,2002, by both first-class mail and certified mail. No petition for remission of bail has been filed by defendant or her surety. Nor has defendant been located or turned herself in to the proper authorities.

On June 4, 2002, the Commonwealth filed a petition to utilize the forfeited bail for restitution. Notice of the petition and date set for hearing and argument on the petition was provided to the defendant, her surety, and Carbon County. The county has filed an answer opposing the petition and also appeared in opposition to the petition at the time of the scheduled hearing and argument on July 12, 2002. The county does not dispute the factual averments of the petition but does dispute the authority of this court to provide the relief requested by the Commonwealth. Neither the defendant nor her surety filed an answer to the petition or appeared at the hearing and argument held on July 12, 2002.

The initial appeal of the district attorney’s argument for the application of forfeited bail proceeds to compensate the victim is belied by legal authority. In general, “all matters relating to the fixing, posting, forfeiting, exoneration, and distribution of bail and recognizances shall be governed by general rules.” 42 Pa.C.S. §5702. These rules appear primarily in chapter 5, part C, of the Rules of Criminal Procedure.

Defendant’s failure to appear for sentencing violated an express condition of her bail bond and one mandated by Rule 526(A)(1). The rules specifically authorize issuance of a bench warrant for defendant’s arrest and forfeiture of cash or other security posted as bail when a condition of the bail bond is violated. Pa.R.Crim.P. 536(A)(1)(b) and 536(A)(2)(a). Defendant and her surety must be provided with written notice of the forfeiture. Pa.R.Crim.P. 536(A)(2)(b). The forfeiture may not be executed upon until 20 days after notice of the forfeiture order. Pa.R.Crim.P. 536(A)(2)(c).

The Rules of Criminal Procedure do not provide for the disposition of forfeited bail. However, by statute, forfeitures imposed by the court of common pleas are payable to the county. 42 Pa.C.S. §3572. See also, Commonwealth v. Graziadei, 92 Pitts. L.J. 35, 37 (1943). Once forfeited, money deposited to secure a defendant’s appearance or compliance with the conditions of the bail bond loses its identity as bail and becomes property of the county, subject to the possibility of being set aside or remitted by the court pursuant to Pa.R.Crim.P. 536(A)(2)(d).

A forfeiture, once declared by the court, may be set aside or remitted as justice requires. If a refund of forfeited moneys is requested by a surety, the court is obligated to hold a hearing and consider the equities of the claim. Commonwealth v. Ball, 228 Pa. Super. 222, 323 A.2d 8 (1974). The primary factor to be considered in deciding whether to remit forfeited money is the importance of the bondsman’s participation in producing the defendant in court.

“ ‘[T]he remission of forfeitures is a practice calculated to encourage bondsmen to actively seek the return of absent defendants. For this reason, the results of a bondsman’s efforts as well as the extent of these efforts are prime considerations in the determination of the amount of any remission.’ Therefore, the lower court did not abuse its discretion by focusing on this factor because this is precisely the undertaking which every bondsman implicitly agrees to guarantee.” Commonwealth v. Reeher, 245 Pa. Super. 282, 286-87, 369 A.2d 404, 406 (1976) (quoting in part from lower ct. op.).

“Mere participation in the search for the defendant is not enough. The apprehension or return of the defendant must either be effected by the efforts of the bondsman or [those efforts must] at least have a substantial impact on his apprehension and return.” Commonwealth v. Fleming, 336 Pa. Super. 377, 379, 485 A.2d 1130, 1131 (1984) (quoting from lower court opinion), (emphasis in original) Hearing on the surety’s claim is necessary in order that the “court may have before it evidence of the extent of the [surety’s] participation in the return of the defendants.” Commonwealth v. Ball, supra at 223, 323 A.2d at 8.

Equitable principles apply when a court is faced with the decision whether to modify or remit a forfeiture. Commonwealth v. Nolan, 288 Pa. Super. 484, 432 A.2d 616 (1981); Commonwealth v. Bahn, 74 D.&C.2d 122 (York Cty. 1975). In this case, if the court were to grant the Commonwealth’s request and later determine that the defendant’s surety is equitably entitled to a remission of the forfeiture, the forfeited money would no longer be available to remit. For the court to require the county to bear the burden of this risk and make refund to the surety out of the county’s general funds, after having previously directed payment of the forfeited bail proceeds to the victim, would be grossly unfair to the county and its residents.

Additionally, the Commonwealth has offered no legal authority for placing the burden of paying restitution on the surety. By statute, mandatory restitution needs to be ordered against the offender, not the surety, at the time of sentencing. 18 Pa.C.S. §1106. Here, the monies forfeited and from which the Commonwealth seeks payment for restitution were deposited by the surety, a receipt for the deposit was provided to the surety, and had the defendant satisfied all conditions of bail, the money would be required to be returned to the surety. Common wealth v. Tanur, 355 Pa. Super. 188, 512 A.2d 1276 (1986).

Compounding the risk the Commonwealth asks the surety to assume, is the request that bail forfeited in one case be used to make restitution in another. The total amount of cash bail posted by the surety in case no. 217 CR 01 is $5,000 whereas the amount of restitution sought is $6,702. The Commonwealth asks that the difference be funded from the monies forfeited in case no. 218 CR 01, a case involving a different victim. The bail bond and other paperwork signed by the surety never advised the surety of this possibility and the surety never agreed to such disposition.

In Commonwealth v. Kovalak, 17 D.&C.3d 719 (Washington Cty. 1981), the court faced a challenge to its local rule which required a defendant and any third party depositing a percentage bail to agree that the costs of prosecution, fine, restitution and a $10 service fee would be deducted from the amount deposited, should defendant be found guilty. The court found the rule invalid, in part because its effect was to impose defendant’s sentence upon persons other than the defendant. In language relevant to this decision, the court stated:

“A surety risks his money upon the probability of an event occurring. Incarcerated defendants might have relatives or third parties who believe that they will appear for trial. These third parties are able to gauge the risk involved before putting up bail, but they are in no position to gauge the merits of the case against defendant and make a gamble as to its outcome. As authority is not given by the Pennsylvania Rules of Criminal Procedure to force this type of risk upon a third party, we find that it is invalid and strike it from the remainder of local court Rule 4006. We do not say at this time that fines, restitution and costs of prosecution cannot be taken from bail put up by defendant himself, but only that it is invalid to force a third party to consent to these additional deductions.” Id. at 722. To financially penalize sureties of defendants who have not been sentenced and, in the process, to permit defendants to escape responsibility for their own criminal conduct, subverts the very philosophy and purpose of the criminal law. Commonwealth v. Bahn, 74 D.&C.4th 122, 129 (York Cty. 1975). To foist on the surety defendant’s obligations for restitution would result in replacing one victim with another.

Finally, the disposition requested by the Commonwealth would deprive the county of any claim it may make in the future for reimbursement of costs and expenses incurred in locating and returning the defendant to the jurisdiction of this court and the reasonable costs of administering the percentage cash bail program. These costs are commonly retained by the county even when remission is ordered. Commonwealth v. Jones, 286 Pa. Super. 507, 429 A.2d 436 (1981).

Fundamentally, what the Commonwealth is asking the court to do is to dramatically alter the law with respect to the disposition of forfeited bail, to direct the county on how it must use forfeited security and to place the risk of a premature disposition on the county and its residents. This the court will not do.

ORDER

And now July 23, 2002, upon consideration of the Commonwealth’s petition to utilize forfeited bail for restitution and after hearing arguments of the parties it is hereby ordered and decreed that the relief requested in the petition is denied and the monies forfeited in the above two cases are directed to be paid to the county for use of the county.

If and when the defendant or her surety, Joseph Miller, properly petition for remission, setting forth with specificity the relevant facts, and serve the petitions on the district attorney and county commissioners, we shall consider such applications at the appropriate time.

      .18 Pa.C.S. §3502(a).

      . 18 Pa.C.S. §3921 (a).

      . 18 Pa.C.S. §3922(a)(l).

      . 18 Pa.C.S. §3925(a).

      . Pa.R.Crim.P. 520-536. Rule 520 provides for the issuance of bail generally; Rule 524 identifies the types of release on bail, including release on a monetary condition; Rule 528 provides for determining the amount of the monetary condition and the form of security acceptable to satisfy the monetary condition. A cash deposit in the amount of 10 percent of the full amount of the monetary condition is authorized under Rule 528(C) & (D)(1).

      . The first condition of defendant’s bail bond provides that, “defendant must appear at all times required until full and final disposition of the case.” The surety information page signed by Joseph Miller further provides that, “[i]f the defendant fails to appear as required ... the full sum of the monetary condition of release may be forfeited, the defendant’s release may be revoked, and a warrant for the defendant’s arrest may be issued.”

      . “Bail has been long recognized as a procedure whereby an individual defendant provides a form of collateral ‘in exchange for the defendant’s release from custody; it secures his future appearance and other requirements of his bond ... .’ ” Commonwealth v. Chopak, 532 Pa. 227, 238, 615 A.2d 696, 702 (1992), quoting Commonwealth v. McDonald, 476 Pa. 217, 221, 382 A.2d 124, 126 (1978). Bail is defined in the Rules of Criminal Procedure as being, “the security or other guarantee required and given for the release of a person, conditioned upon a written undertaking, in the form of bail bond, that the person will appear when required and comply with all conditions set forth in the bail bond.” Consequently, when bail is revoked, the defendant is denied the opportunity to remain outside of custody pending the outcome of his judicial process. Id. at 240 n.7, 615 A.2d at 703 n.7. In contrast, bail forfeiture refers to the process whereby part or all of the security posted for a defendant’s release is surrendered when a condition of bail is breached. Id. at 240 n.7, 615 A.2d at 703 n.7.

      . Previously, two statutes and former Rule 4016, now Rule 536, addressed the issues of forfeitures and remission of bail. In discussing the legal standard applicable to a bondsman’s claim for remission of forfeited money, the Superior Court stated:
      “Two statutes and one rule of criminal procedure delineate the legal standards applicable in this case. 8 P.S. §171 reads, ‘[a]ll recognizances forfeited in any court of quarter sessions of the peace within this Commonwealth... shall and may be sued for and be recoverable in the court of common pleas of that county in which the said recognizances shall be forfeited respectively, which courts may, and they are hereby empowered to order the said recognizances to be levied, moderated or remitted, on hearing the circumstances of the case, according to equity and their legal discretion.’ 8 P.S. §177 ... provides, ‘[i]n all cases where the county commissioners of any county shall collect, or have collected, any money upon any forfeited recognizance, . . . and the defendant in such case subsequently surrenders himself or herself to the jurisdiction ... of the court, the county commissioners may, (a) with the consent of the district attorney, and (b) shall upon order of court in any case, repay to the party from whom such money was collected the amount so collected on such forfeited recognizance, exclusive of all costs paid or incurred by the county in such proceeding.’ Rule4016, subd. A(l)(c). Pa.R.Crim.P. (Supp. 1976) states, ‘[t]he issuing authority or the court may direct that a forfeiture be set aside upon such conditions as may be imposed if it appears that justice does not require enforcement of the forfeiture.’ Pennsylvania courts have uniformly interpreted the foregoing statutes and rule to give the lower court discretion in deciding whether to remit forfeited money to a bail bondsman.” Commonwealth v. Reeher, 245 Pa. Super. 282, 285-86, 369 A.2d 404, 405-406 (1976). (footnotes omitted) Both statutes referred to in Reeher were repealed by the Judiciary Act Repealer Act, 42 Pa.C.S. §20001-20004 (JARA), effective June 27, 1978. Section 171 was repealed by JARA effective June 27, 1978, and replaced by 42 Pa.C.S. §931(a) and section 5702 of the Judicial Code. Section 177 was replaced by 42 Pa.C.S. §5702, but the repeal was not effective until June 27, 1980.

      ..One possible solution of avoiding the risk of the surety seeking remission in the future is for the county to commence suit against the surety for judgment on the surety bond. Since remission of forfeited bail is only authorized where the defendant is apprehended and returned to the jurisdiction of the court, whether the surety could later request remission of money paid in satisfaction of a judgment confessed on the forfeited bail bond or entered in a suit upon the bond appears to be an open question. Commonwealth v. Fleming, 336 Pa. Super. 377, 485 A.2d 1130 (1984); cf. Commonwealth ex rel. Philadelphia v. Public Service Mutual Insurance Co., 213 Pa. Super. 327, 247 A.2d 636 (1968).

      . Consistent with this language, Carbon County Local Rule 535.4 provides:
      “Disposition of bail deposited by a third party: Where a third party surety has deposited money, under the percentage cash bail program or otherwise, the monies deposited shall be first applied to the administrative costs of the clerk of courts. With the voluntary written authorization of the person who deposited the bail, any balance shall then be applied to any restitution ordered by the court, then to the fine, if any, and then to other costs ordered by the court to be paid.”
      Similarly, 28 U.S.C. §2044 authorizes the court to order any money belonging to and deposited by or on behalf of a defendant with the court for the purposes of a criminal appearance bond to be held and paid over to the United States Attorney to be applied to the payment of any assessment, fine, restitution, or penalty imposed upon the defendant. This authorization does not apply with respect to any third party surety.

      . Although not intended, the position taken by the Commonwealth in these proceedings creates an antagonism between the Commonwealth, the county, and the victim when none should exist. Inherent in the Commonwealth’s position is a need for the county in protecting its funds and the interest of the public to reduce damages sought in restitution by denying or extenuating the guilt of the defendant.


author: SHEPPARD JR., J.,

text:
    Dearlove v. Genzyme Transgenics Corporation

      C.P. of Philadelphia County,
    November Term 2001,
    no. 1031.

      Cletus P. Lyman, for plaintiffs.

      Judith E. Harris and William J. Delaney, for defendant.
    July 19, 2002
   SHEPPARD JR., J.,

Defendant, Genzyme Transgenics Corporation, has filed a petition to dismiss plaintiffs’ class action complaint pursuant to 42 Pa.C.S. §5322(e). For the reasons set forth, the court is issuing a contemporaneous order denying the petition.

FACTUAL ALLEGATIONS

Plaintiffs, George Dearlove and Annaregina Roberts, filed this class action alleging that GTC canceled the putative plaintiffs’ stock options, originally granted to them pursuant to GTC’s 1993 equity incentive plan, in violation of the plan. Compl., ¶¶29-31.

GTC is a biopharmaceuticals company with its headquarters and principal place of business at 175 Crossing Boulevard, Framingham, Massachusetts. Petition, ¶¶1-2. Framingham, Massachusetts is located approximately 290 miles from Philadelphia, Pennsylvania. Petition, ¶4; answer, ¶4.

Previously, GTC owned a subsidiary called Primedica Corporation, also a biotechnology company with its headquarters and principal place of business in Worcester, Massachusetts. Petition, ¶28; answer, ¶28. GTC also previously owned Primedica’s five subsidiaries: Primedica Worcester Inc. (principal place of business in Worcester, Massachusetts), Primedica Cambridge Inc. (principal place of business in Cambridge, Massachusetts), Primedica Argus Research Laboratories Inc. (principal place of business in Pennsylvania), Primedica Redfield Inc. (principal place of business in Redfield, Arkansas), and Primedica Rockville Inc. (principal place of business in Rockville, Maryland). Petition, ¶¶29-34; answer, ¶¶29-34. (Primedica Corporation and its five subsidiaries will be referred to in this opinion, collectively, as “Primedica.”)

The plaintiffs are employees of Primedica Argus Research Laboratories. Compl., ¶4. Plaintiff, George Dearlove, resides in Landenberg, Pennsylvania, and plaintiff, Annaregina Roberts, resides in Philadelphia, Pennsylvania. Compl., ¶¶1-2; answer, ¶51.

In 1993, GTC instituted a stock option plan entitled the 1993 equity incentive plan to award GTC stock options to the employees of GTC and Primedica. Petition, ¶¶5-6. Beginning in 1993, GTC awarded stock options pursuant to the plan to Primedica employees, including the plaintiffs. Petition, ¶¶42-43; answer, ¶¶42-43; Compl., ¶¶6, 9. The plan states that its provisions “shall be governed by and interpreted in accordance with the laws of the Commonwealth of Massachusetts.” Petition, ¶9.

On February 26,2001, GTC sold Primedica to Charles River Laboratories International Inc., a biotechnology company with its headquarters and principal place of business in Wilmington, Massachusetts. Petition, ¶¶35-36. Defendant contends that upon the sale of Primedica, “the plan required the exercise or cancellation of the vested shares held by those employees within 90 days of the closing of the sale.” Petition, ¶45. According to GTC, on March 9,2001, it notified Primedica employees who held stock options that they had until May 26, 2001 to exercise their vested options. Petition, ¶46; answer, ¶¶46, 51. Plaintiffs dispute this, contending that no Pennsylvania employee was given notice. Those stock options held by Primedica employees which were not exercised by May 26, 2001, were canceled. Compl., ¶31.

Dearlove and Roberts bring the complaint on behalf of a putative class which includes “all employees of Primedica Corporation and it[s] subsidiaries who, as of February 7, 2001, had been awarded stock options and who had not yet exercised their options.” Compl., ¶13. Plaintiffs allege that the putative class is composed of 641 former employees of Primedica. Answer, ¶¶42-43. Plaintiffs base this allegation on a document produced by defendant containing the last known addresses of all employees of Primedica who, as of February 7, 2001, had been awarded stock options and who had not yet exercised their options. Answer, exhibit 5, defendant’s response to plaintiffs’ request for interrogatories no. 1.

Plaintiffs allege that of these 641 former Primedica employees, 299 (or 46.6 percent) have addresses in Massachusetts, 145 (or 22.6 percent) have addresses in Pennsylvania (17 of whom are in Philadelphia), 70 (or 10.9 percent) have addresses in Maryland, 68 (or 10.6 percent) have addresses in Arkansas, ánd 59 (or 9 percent) have addresses in 11 other states (including 19 in Connecticut, eight in Rhode Island and six in New Hampshire). Answer, ¶42.

Defendant alleges that “[a]s of February 26, 2001, stock options issued pursuant to the plan were held by 38 current and former employees of Primedica Corporation, 301 current and former employees of Primedica Worcester [Inc.] and Primedica Cambridge [Inc.], 78 current and former employees of Primedica Rockville [Inc.], 153 current and former employees of Primedica Argus [Research Laboratories Inc.], and 66 current and former employees of Primedica Redfield [Inc.].” Petition, ¶42.

In their complaint, plaintiffs have alleged three counts against defendant GTC: breach of contract, breach of covenant of good faith and fair dealing, and unjust enrichment. Compl., ¶¶28-36; 37-42; 43-47.

The instant petition seeks to dismiss based on forum non conveniens. Defendant contends that this case should be dismissed and brought by plaintiffs in Worcester County, Massachusetts.

DISCUSSION

I. Standard of Proof To Dismiss Based on Forum Non Conveniens

Defendant relies on 42 Pa.C.S. §5322(e), which permits a Pennsylvania court to dismiss a matter in whole or in part when the court finds that in the “interest of substantial justice” the matter should be heard in a forum outside Pennsylvania. To analyze defendant’s petition, this court also looks to Pa.R.C.P. 1006 which governs changes of venue within Pennsylvania. Both section 5322(e) and Rule 1006 are applied in the same way in cases involving a petition to transfer venue based on the common-law doctrine of forum non conveniens. Jones v. Borden Inc., 455 Pa. Super. 110, 114, 687 A.2d 392, 394 (1996), citing Shears v. Rigley, 424 Pa. Super. 559, 564, 623 A.2d 821, 824 (1993).

To dismiss pursuant to section 5322(e), a court must first find that the case could be brought in an alternative forum. Farley v. McDonnell Douglas Truck Services Inc., 432 Pa. Super. 456, 462, 638 A.2d 1027, 1030 (1994). Once the viability of an alternative forum has been determined, the defendant has the burden of showing that the plaintiff’s choice of forum is vexatious or oppressive. The Pennsylvania Supreme Court has expounded on this “vexatious or oppressive” standard, stating:

“[T]he defendant may meet its burden of showing that the plaintiff’s choice of forum is vexatious to him by establishing with facts on the record that the plaintiff’s choice of forum was designed to harass the defendant, even at some inconvenience to the plaintiff himself.... Alternatively, the defendant may meet his burden by establishing on the record that trial in the chosen forum is oppressive to him; for instance, that trial in another county would provide easier access to witnesses or other sources of proof, or to the ability to conduct a view of premises involved in the dispute. But, we stress that the defendant must show more than that the chosen forum is merely inconvenient to him.” Cheeseman v. Lethal Exterminator Inc., 549 Pa. 200, 213, 701 A.2d 156, 162 (1997). (footnote omitted)

The burden on the defendant to satisfy this standard is a heavy one. Goodman by Goodman v. Pizzutillo, 452 Pa. Super. 436, 445, 682 A.2d 363, 367 (1996). The defendant’s burden to justify a change in venue is increased when a plaintiff has chosen his home forum. Page v. Ekbladh, 404 Pa. Super. 368, 372-73, 590 A.2d 1278, 1280 (1991).

In essence, a defendant must establish facts on the record showing in what ways the plaintiff’s chosen forum is vexatious or oppressive. Hoose v. Jefferson Home Health Care Inc., 754 A.2d 1, 3 (Pa. Super. 2000), citing Cheeseman, 549 Pa. at 213, 701 A.2d at 162. Although no evidentiary hearing is necessary, the defendant must provide the names of the witnesses who will be called to testify, a general statement of what their testimony will cover, and an explanation of the hardships the witnesses would suffer if the matter remained in the plaintiff’s chosen forum. Johnson v. Henkels & McCoy Inc., 707 A.2d 237, 240 (Pa. Super. 1997); see also, Petty v. Suburban General Hospital, 363 Pa. Super. 277, 285, 525 A.2d 1230, 1234 (1987). If the defendant fails to establish these facts, a court must deny the forum non conveniens petition.

For purposes of this petition and pursuant to Pa.R.C.P. 206.7(c), the record consists of plaintiffs’ verified complaint, defendant’s verified petition to dismiss, plaintiffs’ verified answer to the petition, as well as the affidavits and verified discovery responses attached to, and offered in support of these filings. Rule 206.7(c) states:

“If an answer is filed raising disputed issues of material fact, the petitioner may take depositions on those issues, or such other discovery as the court allows, within the time set forth in the order of the court. If the petitioner does not do so, the petition shall be decided on petition and answer and all averments of fact responsive to the petition and properly pleaded in the answer shall be deemed admitted for the purpose of this subdivision.” Pa.R.C.R 206.7(c). Accordingly, all of plaintiffs’ averments of fact responsive to the defendant’s petition and properly pleaded shall be deemed admitted.

II. Availability of an Alternative Forum

The initial consideration is whether this case could be brought in an alternative forum because “[dismissal of a complaint on the grounds of forum non conveniens should not be granted when such a decision results in the plaintiff being unable to institute an action elsewhere.” Farley, 432 Pa. Super, at 463, 638 A.2d at 1030.

Plaintiffs argue that this action could not be maintained as a nationwide class action in Massachusetts because that Commonwealth’s class action rule, specifically Mass.R.C.P. 23(b), does not permit a putative class member to opt out of a class action. Without an opt-out provision, plaintiffs argue that Massachusetts would not be able to comply with the United States Supreme Court’s mandate of Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 811 (1985), that a state must permit a potential plaintiff the opportunity to opt out of a class action. Pltfs’ memorandum of law, p. 11. Plaintiffs further argue that notwithstanding the absence of an alternative forum for what they hope will be a nationwide class action, it would be inappropriate to find that the putative class members could bring individual actions in alternative fora because Pennsylvania favors class actions in circumstances where claims of many individuals can be resolved together. Id. at 13.

In response, GTC contends that, despite the absence of an opt-out provision, this potential nationwide class action could be maintained in Massachusetts in accordance with the United States Supreme Court’s mandate because a Massachusetts court may assert personal jurisdiction over a non-Massachusetts resident where there exists “some minimum contact with the Commonwealth which resulted from an affirmative, intentional act of the [party].” Def’s memorandum of law, p. 3, quoting Nile v. Nile, 432 Mass. 390, 734 N.E.2d 1153, 1158 (2000); see Eldridge v. Provident Companies Inc., no. 97-1099, 2000 WL 289640, *2-3 (Mass. Super. 2000). (In consideration of a motion for nationwide class certification, the court held that “the opportunity to opt out [of the class] may not be required in those instances where a state can establish personal jurisdiction over all plaintiffs or where the quest for equitable relief predominates over the pursuit of money damages.”) GTC contends that a Massachusetts court could assert personal jurisdiction over Dearlove and Roberts, as well as each of the members of the putative class, because all of them have worked to generate profits for GTC, a Massachusetts company, and participated in GTC’s stock option plan which was administered in Massachusetts. Def’s memorandum of law, pp. 3-4. Thus, GTC argues that a Massachusetts court could serve as an alternative forum for this action because it could satisfy due process concerns simply by providing notice and an opportunity for the putative class members to object. Furthermore, GTC urges that a finding that plaintiffs could bring individual actions in Massachusetts satisfies the requirement that an alternative forum be available for the plaintiffs to litigate their claims. Id.

This court is persuaded that a Massachusetts court could serve as an alternative forum for this action based on assertion of personal jurisdiction over the putative class members. However, the existence of the alternative forum is not dispositive. The court must now determine whether this forum is oppressive or vexatious, so as to warrant dismissal.

III. Whether Plaintiffs’ Chosen Venue Is Vexatious or Oppressive

The standard mandates that defendant demonstrate on the record that the forum is indeed oppressive, not whether there is a lack of a factual connection to the chosen forum, or whether another forum would be more convenient. Cheeseman, 549 Pa. at 214, 701 A.2d at 162. Our Supreme Court has held, “[cjlaims by the defendant in its petition that no significant aspect of the case involves the chosen forum, and that litigating in another forum would be more convenient... do not amount to a showing that the chosen forum is oppressive or vexatious.” Cheeseman, 549 Pa. at 214, 701 A.2d at 162.

GTC cites several reasons, supported by verified affidavits, why litigating this case in Philadelphia County is oppressive and vexatious. First, GTC argues that “[a]ll of the individuals that GTC anticipates calling as witnesses at trial currently work and reside in Massachusetts” and “[a]ll of the witnesses at trial will experience substantial hardship if they are required to travel to Philadelphia to testify.” Petition, ¶¶51-52; affidavits of Henry Blair ¶7; Francis Bullock ¶¶9-10, John Green ¶¶7-9, Patricia Nagle ¶9, Alan Tuck ¶8. But, the fact that five affiants who may be called as trial witnesses reside in Massachusetts is not persuasive, in and of itself, because all five need not attend for the entire trial, but only for the time that they testify. In addition, Philadelphia is easily accessible from the areas of Massachusetts where the five affiants reside and work. Pltfs’ memorandum of law, pp. 18-19. It is true that today’s heightened security measures can result in increased travel time, but with counsel’s organization and cooperation, these affiants will not have to travel “back and forth” to Philadelphia for trial. The affidavits supplied by GTC reveal that the affiants may be inconvenienced, but do not show facts sufficient to overcome the consideration given to plaintiffs’ chosen forum.

GTC also urges that “[t]he business of each of the companies that employs the individuals that GTC anticipates calling as witnesses at trial will be seriously interrupted if those individuals are required to travel to Philadelphia to testify.” Petition, ¶54; affidavits of Henry Blair ¶8; Francis Bullock ¶10, John Green ¶¶7, 9, Patricia Nagle ¶10, Alan Tuck ¶9. This court is not persuaded that the burden of testifying at trial will unduly oppress or vex these folks in that GTC has produced a travel log showing that these five affiants take frequent trips outside of Massachusetts for business and personal reasons. Answer, exhibit 4, defendant’s response to plaintiffs’ request for production of documents, addenda 1-5. If these five executives can conduct and manage their work while away on business and personal trips to locations such as Hawaii, Bermuda, Europe, Florida, Alabama and Colorado, this court believes that they can do the same while in Philadelphia for what this court will insist be as efficient a trial as possible.

GTC also argues that litigating this case in Philadelphia is oppressive and vexatious because the relevant documents are located in Massachusetts, including “[spreadsheets that track the disposition of options issued to Primedica employees under the plan between 1993 and 2001, copies of correspondence from GTC to the Primedica employees who were awarded options during that period, the 1993 equity incentive plan, the plan prospectuses, . . . copies of award certificates issued under the plan” and “minutes of the meetings of the [compensation] committee throughout the period 1993 to the present.” Petition, ¶¶48-49. The location of these documents does not present an insurmountable impediment, however, because plaintiffs’ counsel has offered to review the documents where they are located and arrange for copying and shipping. Answer, ¶48. Requiring GTC to copy and mail certain select documents crucial to the issues in this case would not qualify as being sufficiently oppressive to warrant dismissal. In addition, GTC’s argument that plaintiffs have not asserted that any relevant documents or sources of proof are located in Pennsylvania (reply, pp. 10-13) is not controlling because it is the burden of the party moving for dismissal or transfer based on forum non conveniens to show the oppressive or vexatious nature of the chosen forum. It is not the burden of the non-moving party to show otherwise. Goodman, 452 Pa. Super. at 445, 682 A.2d at 367.

Furthermore, GTC’s argument that this court should not defer to the chosen forum because the putative class members reside in other states, such as Arkansas, Maryland and Massachusetts, is not determinative whether the forum is oppressive or vexatious to the defendant. Def’s memorandum of law, p. 15. Similarly, GTC’s argument that the chosen forum does not have a sufficient nexus to the stock option plan administered in Massachusetts is not compelling. Def’s memorandum of law, pp. 22-23. These arguments sidestep the relevant test whether the forum is oppressive and vexatious to the defendant. They focus instead on extraneous issues such as whether there is a lack of a factual connection to the chosen forum, whether another forum would be more convenient, and how significant the role of each of the plaintiffs will be. Cheeseman, 549 Pa. at 214, 701 A.2d at 162.

GTC’s reliance on International Mill Services Inc. v. Allegheny Ludlum Corporation, no. 0106-1559, 2002 WL 748896 (Pa. C.P. April 11,2002) is unpersuasive. In that case, this court transferred venue to Washington County, Pennsylvania where the defendant’s witnesses would have had to travel over 300 miles to testify at trial, and all of the witnesses, including plaintiff’s witnesses, resided outside of Philadelphia, mostly in western Pennsylvania and Ohio. This case is distinguishable. Plaintiff, Annaregina Roberts, resides in Philadelphia County, and 16 putative class members reside in Philadelphia. Pennsylvania case law dictates that the plaintiff’s choice of forum should be given weighty consideration, especially when a plaintiff has chosen his home forum. Page, 404 Pa. Super, at 373, 590 A.2d at 1280. Moreover, the facts in the instant case do not reveal that plaintiffs have brought this action in Philadelphia at an inconvenience to themselves in order to harass GTC. In addition, in International Mill, the defendant requested a transfer of venue within Pennsylvania, whereas in the instant case, GTC requests dismissal of this action altogether. This factor, along with the other considerations, results in the conclusion that the record in the instant case is distinguishable from International Mill.

In summary, Cheeseman, supra, controls and the considerations advanced by GTC are insufficient to meet that decision’s burden.

CONCLUSION

For the reasons discussed, defendant’s petition to dismiss pursuant to 42 Pa.C.S. §5322(e) is denied. The court will enter a contemporaneous order consistent with this opinion.

ORDER

And now, July 19,2002, upon consideration of defendant, Genzyme Transgenics Corporation’s petition to dismiss pursuant to 42 Pa.C.S. §5322(e), the plaintiffs’ response in opposition, the respective memoranda, all matters of record, and in accord with the contemporaneous opinion filed of record, it is hereby ordered that the petition is denied.

      . References to “answer” in this opinion refer to plaintiffs’ answer to the petition to dismiss.

      . Plaintiffs allege that Primedica Argus Research Laboratories Inc. ’s principal place of business is in Horsham, Pennsylvania, whereas defendant alleges that it is in Argus, Pennsylvania. Petition, ¶32; answer, ¶32. For present purposes this is not a disputed material fact. The parties agree that Primedica Argus Research Laboratories Inc.’s principal place of business is in Pennsylvania, although not in Philadelphia County.

      . GTC argues that although the Pennsylvania Supreme Court modified the transfer of venue standard under Rule 1006(d)(1) in Cheeseman, that case “suggests” that the standard would not be modified for section 5322 petitions and that the court “would continue to apply the private and public interests test to petitions under section 5322(e).” Def’s memorandum of law, p. 10. The Pennsylvania Supreme Court has not given this instruction, and absent any case law supporting GTC’s position, this court will follow the Cheeseman standard to analyze defendant’s section 5322(e) petition. Jones, 455 Pa. Super. at 114, 687 A.2d at 394. Consequently, this court will not consider pre-Cheeseman concerns, such as whether denying the petition will cause congestion of this court’s docket, or what law will ultimately govern the merits of plaintiffs’ claims.

      . Plaintiffs argue that for purposes of evaluating the petition to dismiss, the record consists only of plaintiffs’ answer to the petition and the defendant’s answers to plaintiffs’ interrogatories. Pltfs’ memorandum of law, p. 2. This court disagrees based on the language of Rule 206.7(c).

      . GTC has supplied affidavits by Henry Blair (member of the board of GTC and voting member of its compensation committee), Francis J. Bullock (member of the board of GTC and voting member of its compensation committee), John B. Green (vice president and chief financial officer of GTC), Patricia Nagle (stock plan/401(lc) administrator for GTC), and Alan Tuck (member of the board of GTC and voting member of its compensation committee).

      . To decrease any inconvenience, this court will require counsel to accommodate the business schedules of GTC’s trial witnesses as much as possible.

      . Transfer of venue to Worcester County, Massachusetts is not an option because this court lacks the authority to transfer matters to other states’ courts. Farley, 432 Pa. Super. at 467 n.2, 638 A.2d 1032 n.2.

      . Similarly, GTC’s reliance on Grace Community Inc. v. KPMG Peat Marwick LLP, no. 0102-0478, 2002 WL 746379 (Pa. C.P. April 8, 2002) is misplaced. In that case, this court transferred venue from Philadelphia County to Lebanon County, Pennsylvania. Unlike this case, the record in Grace Community revealed that the plaintiffs themselves were located in Lebanon County, and 22 defendant employees who worked in defendant’s Harrisburg office resided in or in close proximity to Lebanon County, most of whom would be called at trial to testify.