Court Gives Detailed Opinion on Sanctions Applicable to Late Payment of Settlement Funds

In the case of Hill v. Riverside Healthcare and Rehabilitation Center, No. 2023-CV-3399 (C.P. Lacka. Co. May 22, 2026 Nealon, J.), the Lackawanna County Court of Common Pleas addressed a Petition filed by a Plaintiff seeking to impose sanctions against a Defendant under Pa. R.C.P. 229.1 for failing to deliver settlement funds in a timely fashion after an executed Release was produced by the Plaintiff.

According to the Opinion, this matter involved a professional liability action against a healthcare and rehab center.

In this matter, the Defendant facility owner at issue in this case eventually became insolvent and filed for bankruptcy.

During the course of this litigation, the parties agreed to participate in a settlement conference with a private mediator. Prior to the mediation, the Defendant’s attorney confirmed in writing that the parent and affiliate entities of the Defendant were insolvent and/or in bankruptcy proceedings and confirmed that the Defendant would not be able to satisfy the first $75,000.00 of any settlement but that any obligation thereafter would be covered by insurance.

After a mediation, the parties reached a settlement agreement for a net payment of $175,000.00. The total amount of the party’s settlement was actually $250,000.00 but the Plaintiff agreed to waive the Defendant’s payment of its $75,000.00 deductible with a net settlement payment of $175,000.00 to be funded entirely by the Defendant's insurance carrier.

The court’s Opinion in this matter emphasized that the insurance company’s adjuster agreed to the settlement without any indication of any coverage issue between the actual Defendant and its insurance company.

Thereafter, in this death case, the court granted the Plaintiff’s Petition for Court Approval of the Settlement. 

The Plaintiff then executed the settlement agreement and sent the signed Release, the court Order approving the settlement, and other closing documents to the Defendant’s counsel and requested payment.

The court point out that noticeably absent from the settlement agreement was any indication, or even a suggestion, that a coverage issue may exist between the Defendant and its insurance company or that any such coverage issue needed to be resolved before the Plaintiff would receive the settlement payment. 

After the closing documents were produced and the settlement check was not forthcoming, Plaintiff’s counsel wrote for the status of the settlement check.  Defense counsel indicated that there was some issue that the adjuster had to work out. There was no reference made to any insurance coverage issue during that interaction.

After several months then went by with no production of the settlement check, counsel for the Plaintiff filed the Motion at issue.

Judge Terrence R. Nealon of the Lackawanna County Court of Common Pleas reviewed Pennsylvania Rule of Civil Procedure 229.1 which governs the prompt delivery of settlement funds within twenty (20) days of the receipt of an executed Release by the Defendant. 

The Rule otherwise provides that, if court approval of the settlement is required, then the 20 day deadline under Rule 229.1 does not begin to run until the settlement is so approved.

Judge Nealon noted that, under Rule 229.1, if the Defendant fails to timely deliver settlement funds, the Plaintiff has the right to seek one of two possible remedies. First, a Plaintiff can seek to invalidate the settlement agreement and allow the matter to return to the trial list. Second, the Plaintiff can seek sanctions against the Defendant.

The court noted that, if a plaintiff opts to pursue sanctions against a defendant, Rule 229.1(e) directs the Plaintiff to (1) file an affidavit “attesting to non-payment,” to submit copies of “any document evidencing the terms of the settlement agreement,” and/or “the executed Release,” and “a receipt reflecting delivery of the executed Release,” (2) file certifications by counsel “of the applicable interest rate,” and “that the affidavit and accompanying documents have been served on the attorneys for all interested parties,” and (3) file “the form of order prescribed by subdivision (h)” for execution by the court.

The court also noted that under Rule 229.1(g), if the court determines that the Defendant has failed to deliver the settlement funds within twenty (20) days and there is no material dispute as to the terms of the settlement or the terms of the Release, the court “shall impose sanctions in the form of interests calculated at the rate equal to the prime rate as listed in the first edition of the Wall Street Journal published for each calendar year for which interest is awarded, plus one (1) percent, not compounded, running from the 21st day after the production of the executed Release to the date of delivery of the settlement funds, together with reasonable attorneys’ fees incurred in the preparation of the affidavit.

The court otherwise ruled that the fact that the insurance company’s noncompliance with the payment requirement may be attributable to a post-settlement assertion of a potential coverage issue did not warrant the denial of the Plaintiff’s request for sanctions.  Accordingly, the court granted the Plaintiff’s Motion and awarded sanctions pursuant to Rule 229.1.

Anyone wishing to review a copy of this decision may click this LINK.

Source of image:  Photo by kaboom pics on www.pexels.com.

Law Allowing For Fines For Holding A Cell Phone While Driving Starts Tomorrow June 5th

A new Pennsylvania law that bans a driver from holding a cell phone while behind the wheel goes into effect tomorrow, June 5, 2026.

These fines are starting after a year of police officers issuing warning tickets in this regard.

Starting tomorrow, officers may issue tickets carrying a $50 fine, plus court costs and other fees.

Note that simply holding a phone, propping up a phone, or reaching for a phone can trigger a ticket.  You could even be issued a ticket for holding your phone at a red light or while stopped in traffic.

Drivers are permitted to use their phones to alert authorities in an emergency.

Also, drivers may still use hands-free technology to make phone calls, to use a GPS, or to listen to music.

It remains to be seen how a related violation of this statute may impact a personal injury motor vehicle accident matter.

Trial Court Rules that Plaintiff's Medical Malpractice Experts are Competent to Testify on Causation

In the case of Kenny v. Lackawanna Health and Rehab Center, No. 2021-CV-1360 (C.P. Lacka. Co. May 28, 2026 Nealon, J.), Judge Terrence R. Nealon of the Lackawanna County Court of Common Pleas addressed various Motions in Limine filed by a Defendant in a medical malpractice case.

The Defendants filed a Motion In Limine seeking to bar the decedent’s treating orthopedic surgeon and the Plaintiff’s skilled nursing care and nursing home administration expert from expressing opinions regarding the cause of the Defendant’s hip fracture.

The Defendant more specifically asserted that the decedent’s treating orthopedic surgeon failed to state his medical causation opinion with the requisite degree of medical certainty in his pre-trial reports. 

After reviewing the record before him, the court ruled that a review of all of the reports issued by the orthopedic surgeon confirmed that the doctor had articulated his medical causation opinion with the requisite degree of medical certainty. The court noted that any objection regarding the particular terminology used by the expert in his reports went to the weight of the evidence rather than the admissibility of the expert testimony. As such, this Motion In Limine was denied.

With regards to the Plaintiff’s nursing expert and the defense argument that this expert should be precluded from testifying regarding causation on the grounds that the expert lacked the required education, training or experience in orthopedics, the court noted that the most recent law in Pennsylvania is that a registered nurse is competent to testify concerning the relevant nursing standard of care as well as on the issue of medical causation. Accordingly, the court overruled the Defendant’s argument that the nursing expert is incompetent to testify as to causation.

Anyone wishing to review a copy of this decision may click this LINK.

Superior Court Affirms Trial Court's Refusal to Open a Default Judgment Against a Defendant

In the case of Kitner’s Lawn & Landscaping, LLC v. LRM Masonry, LLC, No. 699 MDA 2025 (Pa. Super. March 24, 2026 Panella, P.J.E., King, J., and Lane, J.) (Op. by Lane, J.), the Pennsylvania Superior Court found that a trial court did not abuse its discretion when it denied a Defendant’s Petition to Open a Default Judgment.

According to the Opinion, there was a contract between the parties under which it was agreed that the Plaintiff landscaping business would provide services as a subcontractor to the Defendant masonry company.

After a dispute arose between the parties, the Plaintiff filed a Complaint seeking payment for services rendered. The Writ of Summons was personally served on the owner of the Defendant, who accepted service.

Thereafter, the Plaintiff filed a Complaint and served the Defendant by mail. The mailing was not returned.

The trial court later entered a default judgment against the Defendant for failing to file an Answer to the Complaint.

Sixty-seven days after the entry of the default judgment, the Defendant filed a Petition to Open the Judgment. The Defendant asserted that the Plaintiff was aware that the Defendant’s principal place of business was at the Defendant’s home and not another address at which the ten day notice of intent to enter a default was sent and.  The Defendant also noted that the mailing of the ten day notice was filed of record with the court and was marked as “undeliverable.”

The appellate court agreed that the trial court did not abuse its discretion and refusing to open the default judgment. The appellate court emphasized that the Defendant had no official address filed with the Department of State in Pennsylvania. It was additionally noted that the sheriff had successfully served original process, which was the Writ of Summons, on the Defendant.

The appellate court also noted that the Plaintiff sent the Complaint, the Notice of the Default Judgment, and other filings to the same address that was on the Writ of Summons. That address was noted to also appear on the Defendant’s website. Accordingly, the appellate court found that the Plaintiff had met the service requirements under the Rules of Civil Procedure.

The appellate court also agreed that the Defendant did not establish a reasonable excuse for failing to file a responsive pleading to the Complaint.

The court otherwise noted that it saw no fatal defect on the record to support any separate Motion to Strike.

Anyone wishing to review a copy of this decision may click this LINK.


Source: The Legal Intelligencer State Appellate Case Alert, www.Law.com (April 7, 2026).

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Defendant Found to Be Statutory Employer and Entitled to Immunity

In the case of Edie v. George Junior Republic In Pennsylvania, No. 546 C.D. 2025 (Pa. Cmwlth. March 27, 2026 Cohn Jubelirer, P.J., Covey, J. Wallis, J.) (Op. by Covey, J.), the Pennsylvania Commonwealth Court addressed the application of the statutory employer doctrine in a third party negligence case.

According to the Opinion, the Defendant operated a youth residential institution and contracted with a food service company to provide food services at the facility.

The Plaintiff, who was employed by the food services facility, was cleaning a grill while working in the kitchen at the facility when the Plaintiff was caused to fall and suffer injuries.

The Plaintiff filed a Complaint against the youth residential institution alleging negligence due to unsafe conditions in the kitchen.

The Defendant youth residential institution responding by asserting immunity under the Worker’s Compensation Act as a statutory employer.

The trial court agreed with the Defendant and dismissed the case under a summary judgment motion. The Plaintiff appealed.

The Commonwealth Court applied the McDonald test, which requires that five (5) elements be established to establish a statutory employer status. Those elements include the existence of a contract with the owner, proof that the premises were occupied or controlled by the employer, a subcontract between the parties at issue, and proof that part of the employer’s regular business was entrusted to the subcontractor, and, finally, that the Plaintiff was an employee of the subcontractor.

Here, the Plaintiff only contested the second element, arguing that the Defendant did not have the necessary level of control or occupancy to meet this element of the doctrine.

The appellate court found that the youth residential institution occupied the premises given that its food services director was present daily and oversaw the food services provider’s operations by ensuring compliance with contractual and regulatory requirements. 

The court additionally noted that the residential facility’s employees were also regularly present in the kitchen. It was additionally noted that the residential facility maintained control over the kitchen's equipment and operation.

As such, the Commonwealth Court agreed that the Defendant residential facility had met the occupancy requirement, thereby satisfying that contested element of the McDonald test.

Accordingly, the appellate court affirmed the trial court’s entry of summary judgment in favor of the Defendant as a statutory employer of the Plaintiff.  As a statutory employer, the Defendant facility was found to be entitled to immunity under the Worker’s Compensation Act from the claims presented in the third party personal injury liability lawsuit.

Anyone wishing to review a copy of this decision may click this LINK.

Source: The Legal Intelligencer State Appellate Case Alert, www.Law.com (April 14, 2026).

Source of image:  Photo by Pylyp Sukhenko on www.unsplash.com.