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J. A34018/98
PHYLLIS A. SAUNDERS, AIKEEM GREEN, : ALAYA GREEN, ANDRE GREEN, BY THEIR : PARENT AND NATURAL GUARDIAN, : SANDRA GREEN AND SANDRA GREEN, : IN HER OWN RIGHT, ELLEN JENKINS : AND HERTZ CORPORATION :
: . . . . . . . . . . . . . . . . . . . . . . . . . :
: TIFFANY L. FULTON, A MINOR, BY HER : PARENTS AND NATURAL GUARDIANS, : RENALDO FULTON AND D. TINA FULTON, : H/W AND RENALDO FULTON AND D. : TINA FULTON, H/W, INDIVIDUALLY AND : IN THEIR OWN RIGHT, :
:
v. :
: PHYLLIS A. SAUNDERS, ELLEN JENKINS : AND HERTZ CORPORATION :
: . . . . . . . . . . . . . . . . . . . . . . . . . :
: RANDEL LINDER, AUNT FOR THE : PURPOSE OF THIS LITIGATION, : GUARDIAN OF MINORS, DAVID LINDER, :
SAMANTHA JENKINS, AND ELLEN LINDER, AND MINOR PLAINTIFFS,DAVID LINDER, SAMANTHA JENKINAND ELLEN LINDER, IN THEIR OWRIGHT,   S N  : : : : :  
:  
v.  :  
:  

ELLEN JENKINS, PHYLLIS A. SAUNDERS, :
AND THE HERTZ CORPORATION :
:
Appellees :
:
:
APPEAL OF:  THE HERTZ CORPORATION :

IN THE SUPERIOR COURT OF PENNSYLVANIA
NO. 298 PHILADELPHIA 1998


J. A34018/98

Appeal from the Judgment dated December 18, 1997
In the Court of Common Pleas of Philadelphia County
Civil Division, January Term, 1992,  No. 3384;
July Term, 1993, No. 1037; and July Term, 1993, No. 3213

BEFORE:  KELLY, JOYCE, JJ., and CERCONE, P.J.E.
OPINION BY JOYCE, J. Filed:  September 3, 1998

This is an appeal from the final judgment of the trial court which found for Appellees on the issue of liability. For the reasons set forth below, we reverse and remand. The relevant facts and procedural history of this case are as follows.
Appellee, Phyllis Saunders, accompanied by Ellen Jenkins, an additional defendant in this suit, and Bertha Young went to Hertz Corporation's rental location in the Philadelphia International Airport on July 25, 1991 at approximately 10:30 a.m. in order to rent a van to drive to North Carolina for a church function. Saunders handled all the negotiations on behalf of the group and Jenkins signed the rental agreement as an authorized driver. Pamela Hagood was the Hertz rental agent handling the transaction. Saunders initialed the Hertz rental agreement accepting the Loss Damage Waiver Insurance (LDW) and declining the Liability Insurance Supplement (LIS), Personal Accident Insurance (PAI) and Personal Effects Coverage (PEC).  Saunder's signed the agreement at the end.
Jenkins fell asleep at the wheel of the vehicle while traveling in Virginia causing the accident in which the eleven (11) occupants, three (3) adults

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and eight (8) children, sustained injuries. Saunders and the other occupants of the vehicle instituted an action against the Hertz Corporation, Appellant, and Ellen Jenkins. Appellees sought to recover excess liability insurance and underinsurance coverage in addition to the basic coverage, which is not disputed. The LIS provides additional liability insurance for third.party claims in the amount of $1,000,000 single limit and $100,000 underinsured motorist coverage. The basis of Appellees' action was their contention that Appellant was required to meet various statutory notice provisions once they chose to offer the additional coverage provided within the LIS.
The actions by the various Appellees were consolidated for discovery and trial by stipulation filed March 22, 1994. The trial was bifurcated and proceeded solely on the issue of liability in December of 1996.  Following the non.jury trial, the trial court found Appellant, Hertz, liable to Appellees up to the maximum of the liability insurance supplement despite Appellees' declination of such coverage at the time of the rental agreement.
Appellant filed post.trial motions on March 21, 1997 raising the issue of whether the trial court erred in disregarding their self insured status under Pennsylvania statute and requiring Hertz to comply with provisions applicable to insurance companies selling primary insurance policies. The trial court denied the motion on July 15, 1997. On August 19, 1997, the court amended its March 21, 1997 order to reflect that it was subject to immediate appeal based on a controlling question of law. This Court denied

J. A34018/98

the petition for appeal on October 21, 1997, following which the parties stipulated to the amount of damages. The trial court entered a final judgment on December 17, 1997.  This timely appeal followed.
The sole issue raised for our review is whether the trial court erred in concluding that Hertz, a self insured entity, effectively lost its self.insured status by offering the optional LIS coverage to its rental customers and therefore was required to comply with the notice and rejection provisions applicable to insurance carriers offering primary coverage under the Motor Vehicle Financial Responsibility Law (MVFRL). Appellant argues that as a self. insured entity, it did not have to meet the statutory requirements mandated by the MVFRL.  We are inclined to agree.
In Pennsylvania, it is necessary to provide proof of financial responsibility by submitting that either a policy for motor vehicle liability insurance exists, a program of self insurance applies or other acceptable financial arrangements exist. See 75 Pa. C.S.A.

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