Title Acceptance Insurance Company v. Sloan
Date 2001
By Alito
Subject Misc
Contents
Page 1
78 of 238 DOCUMENTS
ACCEPTANCE INSURANCE COMPANY, Appellant v. ROBERT H. SLOAN, BANKRUPTCY TRUSTEE FOR MON VALLEY STEEL COMPANY, INC.; LARRY M. BOWERS; GLADYS D. BOWERS, INDIVIDUALLY AND AS CO-ADMINISTRATORS OF THE ESTATE OF JOELENE BOWERS, DECEASED; UTICA MUTUAL INSURANCE COMPANY; NOBLE WINE; COMMONWEALTH OF PENNSYLVANIA
No. 00-2423
UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT
263 F.3d 278; 2001 U.S. App. LEXIS 18909; 32 ELR 20228
April 17, 2001, Argued
August 22, 2001, Filed
PRIOR HISTORY: **1 ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA. (Dist. Court No. 98-cv--01647). District Court Judge: William L. Standish.
DISPOSITION: Reversed and remanded.
CASE SUMMARY:
PROCEDURAL POSTURE: Plaintiff insurer sued to resolve its right and duties under a general liability policy issued to defendant mine owner, arguing that it was not required to defend the mine owner because it had termi- nated the policy prior to an individual's death. The insurer appealed the United States District Court for the Western District of Pennsylvania's order entering summary judg- ment for the mine owner.
OVERVIEW: The trial court held that the insurance pol- icy was still in effect at the time of the individual's death because the insurer had failed to notify the state envi- ronmental agency prior to cancelling the insurance pol- icy. The appellate court predicted that the Pennsylvania Supreme Court would have interpreted the regulatory scheme governing coal mines, and specifically 25 Pa. Code § 86.168(d), to mean that the insurer had no duty to inform the state environmental agency of a proposed cancellation unless the insurance policy itself had created a duty to do so. Since the insurance policy had created no such duty and the insurer had notified the mine owner as required under the terms of the insurance policy, the insurer was entitled to summary judgment.
OUTCOME: The order was reversed and the case was re- manded for entry of an order granting summary judgment
in favor of the insurer.
LexisNexis(R) Headnotes
Civil Procedure > Appeals > Standards of Review > De
Novo Review
HN1 The appellate court's standard of review with re- spect to the grant of summary judgment is plenary. Energy & Utilities Law > Mining Industry > Coal
HN2 Under the regulations adopted by the Pennsylvania Department of Environmental Protection (DEP), it is il- legal to operate a coal mine in Pennsylvania without a permit from the DEP. 25 Pa. Code § 86.11.
Energy & Utilities Law > Mining Industry > Coal
HN3 See 25 Pa. Code § 86.144.
Energy & Utilities Law > Mining Industry > Coal
HN4 See 25 Pa. Code § 86.168(a).
Energy & Utilities Law > Mining Industry > Coal
HN5 See 25 Pa. Code § 86.168(d).
Civil Procedure > State & Federal Interrelationships > Application of State Law
HN6 When a state supreme court has yet to interpret a regulation in question in an appeal, the federal court must predict how the state supreme court would resolve the issues should it be called upon to do so.
Energy & Utilities Law > Mining Industry > Coal
HN7 The United States Court of Appeals for the Third Circuit predicts that the Pennsylvania Supreme Court would interpret the regulatory scheme governing coal mines, and specifically 25 Pa. Code § 86.168(d), to mean that an insurer has no duty to inform the Pennsylvania Department of Environmental Protection (DEP) of the cancellation unless the insurance policy itself created a
263 F.3d 278, *; 2001 U.S. App. LEXIS 18909, **1;
32 ELR 20228
Page 2
duty to do so. Although the DEP presumably could have issued a regulation directly requiring an insurer to notify the DEP of cancellation of a mining insurance policy, the DEP has not done so.
Insurance Law > Claims & Contracts > Cancellation & Nonrenewal
HN8 Unless a statute or regulation imposes some addi- tional requirement, where the right to cancel an insurance policy is expressly reserved in the contract itself, then the extent of the right and the conditions upon which it may be exercised must be determined by reference to the contract.
Governments > Legislation > Interpretation
HN9 Pennsylvania has adopted the canon of statutory construction that courts of the Commonwealth must in- terpret unambiguous statutes according to their terms. 1
Pa. Cons. Stat. Ann. § 1921(b) (1995). When interpreting a Pennsylvania statute, the court is to give the words of a statute their plain and ordinary meaning. The words are to be considered in their grammatical context. 1 Pa. Cons. Stat. Ann. § 1930 (1995). Moreover, sections of statutes are not to be isolated from the context in which they arise such that an individual interpretation is accorded one sec- tion which does not take into account the related sections of the same statute. Statutes do not exist sentence by sen- tence. Their sections and sentences comprise a composite of their stated purpose.
Energy & Utilities Law > Mining Industry > Coal
HN10 The principles of statutory construction apply to the coal mine regulations of the Pennsylvania Department of Environmental Protection. 1 Pa. Code § 1.7.
Energy & Utilities Law > Mining Industry > Coal
HN11 The plain meaning of 25 Pa. Code § 86.168(a) and
(d) is that the coal mine permittee must obtain suitable in- surance in order to obtain a permit and that the insurance, in order to be suitable, must contain a rider requiring no- tice to the Pennsylvania Department of Environmental Protection. Section 86.168(d) places no direct obliga- tion on the insurer. Indeed, when viewed in light of §
86.168(a), all of the provisions of 25 Pa. Code § 86.168 speak to the obligations of permittees and permit appli- cants, not to the obligations of insurers.
Governments > Legislation > Interpretation
HN12 One axiom of statutory construction is that when- ever possible each word in a statutory provision is to be given meaning and not to be treated as surplusage. Insurance Law > Claims & Contracts > Cancellation & Nonrenewal
HN13 Whenever a statute or insurance policy provides for notice of cancellation, Pennsylvania law has mandated that an insurer's failure to comply with the provisions
of the notice of cancellation results in the continuation of coverage regardless of any prescribed date of expira- tion. However, this principle of Pennsylvania law does not apply where there is no statute or regulation requiring notification.
Energy & Utilities Law > Mining Industry > Coal
HN14 See 25 Pa. Code § 287.375(b).
Energy & Utilities Law > Mining Industry > Coal
HN15 See 25 Pa. Code § 287.375(c).
Governments > Legislation > Interpretation
HN16 The Pennsylvania legislature provides that when the words of a statute are clear and free from all ambi- guity, the letter of it is not to be disregarded under the pretext of pursuing its spirit. 1 Pa. Code § 1922(b). Governments > Legislation > Interpretation
HN17 See 1 Pa. Code § 1921(a).
Governments > Legislation > Interpretation
HN18 See 1 Pa. Code § 1922(1).
COUNSEL: Russell J. Ober, Jr. (Argued), Kelly A. Reynolds, Meyer, Unkovic & Scott LLP, Pittsburgh, Pennsylvania, Counsel for Appellant.
Jan C. Swensen (Argued), Alan H. Perer, Swensen Perer & Kontos, Pittsburgh, Pennsylvania, Counsel for Appellees Larry M. Bowers and Gladys D. Bowers.
Ashley W. Ward, Sites & Harbison, Lexington, Kentucky, Counsel for Appellee Utica Mutual Insurance Company.
JUDGES: Before: ALITO, RENDELL, and FUENTES, Circuit Judges.
OPINIONBY: ALITO
OPINION:
*279 OPINION OF THE COURT ALITO, Circuit Judge:
Acceptance Insurance Co. ("Acceptance") brought this action seeking a declaratory judgment to resolve its rights and duties under an insurance policy issued to Mon Valley Steel Co. ("Mon Valley"). The policy in question was a general liability policy for the Clyde Mine, located in western Pennsylvania. Acceptance's potential liability arose as a result of an action against Mon Valley brought by the parents of Joelene Bowers, who was pushed to her death through an open *280 shaft in the Clyde
**2 Mine. Acceptance sought to establish that the Clyde Mine insurance policy was effectively terminated prior to Joelene Bowers's death and, thus, that Acceptance is not
263 F.3d 278, *280; 2001 U.S. App. LEXIS 18909, **2;
32 ELR 20228
Page 3
obligated to provide a defense for Mon Valley or to pay for any recovery.
The District Court entered summary judgment against Acceptance, holding that under regulations of the Pennsylvania Department of Environmental Protection
("DEP"), the Clyde Mine policy could not effectively be canceled until the DEP was notified. The District Court further held that no reasonable jury could find from the undisputed facts that Acceptance had notified the DEP of its cancellation of the Clyde Mine policy and that there- fore the policy was still in effect at the time of Joelene Bowers's death. We hold that, under the applicable DEP regulations, notification was not a necessary precondition of cancellation. We therefore reverse.
I.
In 1994, Mon Valley contacted independent insurance broker Phillip Harvey of Phillip J. Harvey & Co., Inc.
("PJH & Co.") to obtain general liability insurance for mining operations at the Clyde Mine. Harvey contacted Tri-City Brokers ("Tri-City") to locate a policy. Through Tri-City's brokerage agreement **3 with Acceptance Risk Managers, Acceptance's underwriters, Acceptance issued a policy to Mon Valley.
On February 13, 1995, Acceptance issued a certificate of insurance to Mon Valley for a general liability policy covering the Clyde Mine. The policy's coverage was to be effective from December 7, 1994, through December
7, 1995, and was subsequently extended through January
24, 1996. The insurance policy contained no provision requiring Acceptance to notify the DEP before canceling the policy.
Mon Valley's last valid permit to operate the Clyde Mine had expired on October 31, 1994, and Mon Valley had ceased all mining operations on approximately that date. Harvey, acting on Mon Valley's behalf, submitted the certificate of insurance to the DEP as proof of the requisite insurance coverage in support of Mon Valley's application for a renewal of its expired mining permit. On March 21, 1995, and again on May 3, 1995, the DEP no- tified Mon Valley that its application for a mining license could not be processed because of several deficiencies in the application and the accompanying proof of insurance. Because Mon Valley did not make the necessary correc- tions or request an informal hearing, **4 the DEP denied the license application on November 9, 1995.
Mon Valley, which financed the policy through First Premium Services, Inc. ("First Premium"), never actually made a premium payment on the policy. On March 7,
1995, First Premium used its power of attorney pursuant to an agreement with Mon Valley to notify Acceptance to cancel the policy for nonpayment of premiums. Although
it is not clear on what date Acceptance actually canceled the policy, it is undisputed that Acceptance took actions which, absent a statutory or regulatory bar, would have terminated the policy by July 15, 1995, at the latest.
PJH & Co. had a general business practice of send- ing notices of cancellation to both certificate holders and state administrative agencies. Harvey testified that a no- tice of cancellation addressed to the DEP was present in PJH & Co.'s files. However, Harvey could not testify from personal knowledge concerning the actual preparation or mailing of the notice. Moreover, the DEP file on Mon Valley did not contain a copy of the notice.
In March 1998, the Bowers commenced an action in the Court of Common *281 Pleas of Greene County, Pennsylvania, captioned Bowers v. Mon Valley Steel Co.,
**5 Inc., et al., Case No. AD-24 (1998) (the "Greene County suit"), to recover damages relating to the murder of Joelene Bowers at the Clyde Mine on January 19 or 20,
1996. Acceptance then brought the instant action, seeking a declaratory judgment that the Clyde Mine policy was effectively canceled prior to Joelene Bowers's death and that Acceptance therefore had no duty to defend or indem- nify Mon Valley in connection with the Greene County suit.
Following discovery, Acceptance moved for summary judgment, arguing that the undisputed facts showed that the Clyde Mine policy had been effectively terminated prior to Joelene Bowers's death. Acceptance argued that it had no duty to notify the DEP prior to cancellation because no contractual provision, statute, or regulation specifically so required. In the alternative, Acceptance ar- gued that, by application of the Pennsylvania "mailbox rule," the undisputed facts gave rise to a presumption that a notice of cancellation had been received by the DEP and that there was insufficient evidence in the record to rebut that presumption.
The Bowerses and Utica also moved for summary judgment, arguing that the applicable DEP regulations mandated that **6 Acceptance notify the DEP before its attempted cancellation became effective. The Bowerses and Utica also argued that Acceptance had not pro- vided sufficient evidence to trigger the mailbox rule. The Magistrate Judge issued a Report and Recommendation, concluding that "the DEP's coal mining regulations estab- lish a strict administrative scheme which unequivocally prohibits an insurer from cancelling a policy without first providing notification to the agency." R. & R. at 12, App. at 18. In reaching this conclusion, the Magistrate Judge relied on 25 Pa. Code § 86.168(d), which outlines the requirements for insurance policies submitted with a per- mit application. The Magistrate Judge also concluded that Acceptance had not adduced sufficient evidence to show
263 F.3d 278, *281; 2001 U.S. App. LEXIS 18909, **6;
32 ELR 20228
Page 4
that notice had been given to the DEP. The Magistrate Judge wrote that Acceptance "could not overcome this significant and undisputed fact: the DEP's license file for Mon Valley does not contain a cancellation notice." R. & R. at 13, App. at 19. Accordingly, the Magistrate Judge recommended that summary judgment be granted to Utica and the Bowerses.
The District Court adopted the Magistrate Judge's rec- ommendation, and Acceptance then **7 took this ap- peal. HN1 Our standard of review with respect to the grant of summary judgment is plenary. Waldorf v. Shuta,
896 F.2d 723, 728 (3d Cir. 1990). The Appellees in this ap- peal are Utica Mutual Insurance Co. ("Utica"), the surety on reclamation and subsidence bonds posted on behalf of Mon Valley, and the Bowerses.
II.
Acceptance raises two issues on appeal. The first is whether the District Court erred in concluding that the DEP regulations require that a surface and underground coal mining general liability insurance carrier notify the DEP prior to canceling an insurance policy. The second issue is whether the District Court erred in concluding that the undisputed facts did not allow Acceptance to benefit from the presumption of receipt accorded to items placed in the mail under the Pennsylvania mailbox rule. We hold that Acceptance had no duty to notify the DEP before canceling the policy, and we therefore need not reach the question whether Acceptance adduced sufficient evidence to take advantage of the Pennsylvania mailbox rule.
*282 A.
Pursuant to the authority granted by the Pennsylvania Surface Mining Conservation and Reclamation Act of May 31, 1945, P.L. 1198, **8 as amended, 52 Pa. Cons. Stat. Ann. §§ 1396.1-1396.31, the DEP has issued regulations governing surface and underground coal min- ing and reclamation activities. See 25 Pa. Code §§ 86.1 et seq. HN2 Under these regulations, it is illegal to op- erate a coal mine in Pennsylvania without a permit from the DEP. See 25 Pa. Code § 86.11. Furthermore, 25 Pa. Code § 86.144 provides that an applicant for a coal mining permit must provide proof of adequate insurance:
HN3
86.144 Requirement to file a certification of liability insurance.
Each applicant for a mining permit shall submit proof to the Department of Environmental Protection of liability in- surance coverage for its mining and recla- mation operations issued by an insurance company authorized to do business in
this Commonwealth. The amount, duration, form, conditions, terms and method of proof of this insurance coverage shall conform to
25 Pa. Code § 86.168 (relating to terms and conditions for liability insurance).
25 Pa. Code § 86.144. The regulations also outline the requirements of an applicant's insurance policy if a permit is to be granted:
86.168. Terms and conditions for liability in- surance.
HN4
(a) **9 A permittee shall submit proof of liability insurance coverage before a permit or license is issued. The proof may consist of either a certificate filed at the time of license application and renewal thereof, or, other- wise annually filed with the Department cer- tifying that the permittee has a public liabil- ity insurance policy in force covering all of the permittee's mining and reclamation oper- ations in this Commonwealth.
. . . .
HN5
(d) The insurance shall include a rider requir- ing that the insurer notify the Department 30 days prior to substantive changes being made in the policy, or prior to termination or failure to renew.
25 Pa. Code §§ 86.168(a), (d) (emphasis added). B.
HN6 Since the Pennsylvania Supreme Court has yet to interpret the regulation in question in this appeal, "we must predict how the state court would resolve these is- sues should it be called upon to do so." Wiley v. State Farm Fire & Cas. Co., 995 F.2d 457, 459 (3d Cir. 1993).
HN7 We predict that the Pennsylvania Supreme Court would interpret this regulatory scheme, and specifically
§ 86.168(d), to mean that Acceptance had no duty to in- form the DEP of the cancellation unless the insurance policy **10 itself created a duty to do so. Although the DEP presumably could have issued a regulation directly requiring an insurer to notify the DEP of cancellation of a mining insurance policy, the DEP has not done so.
HN8 Unless a statute or regulation imposes some additional requirement, "where the right to cancel an in- surance policy is expressly reserved in the contract itself, then the extent of the right and the conditions upon which it may be exercised must be determined by reference to the contract." Clairton City Sch. Dist. v. Mary, 116 Pa.
263 F.3d 278, *282; 2001 U.S. App. LEXIS 18909, **10;
32 ELR 20228
Page 5
Commw. 376, 541 A.2d 849, 851 (Pa. Commw. Ct. 1988)
(citing Hanna v. Reliance Ins. Co., 402 Pa. 205, 166 A.2d
877, 879 (Pa. 1961)). Neither Utica nor the Bowerses argue that Acceptance failed to cancel the policy in ac- cordance with the policy's cancellation clause. Nor do they contend that the policy contained the requisite rider or any language equivalent to what was contained *283 therein. Rather, they argue that § 86.168(d) is ambiguous and that we should interpret it to require notice to the DEP.
HN9 Pennsylvania has adopted the canon of statu- tory construction that courts of the Commonwealth must interpret unambiguous statutes **11 according to their terms. See 1 Pa. Cons. Stat. Ann. § 1921(b) (Purdon's
1995); Anthony v. Koppers Co., 496 Pa. 119, 436 A.2d
181, 183 (Pa. 1991). When interpreting a Pennsylvania statute, we are to give the words of a statute their plain and ordinary meaning. Commonwealth v. Neckerauer,
421 Pa. Super. 255, 617 A.2d 1281 (Pa. Super. Ct. 1992); Commonwealth v. Johnson, 417 Pa. Super. 636, 612 A.2d
1382 (Pa. Super. Ct. 1992). The words are to be consid- ered in their grammatical context. 1 Pa. Cons. Stat. Ann.
§ 1930 (Purdon's 1995). Moreover,
sections of statutes are not to be isolated from the context in which they arise such that an individual interpretation is accorded one sec- tion which does not take into account the re- lated sections of the same statute. Statutes do not exist sentence by sentence. Their sections and sentences comprise a composite of their stated purpose.
Commonwealth v. Lurie, 524 Pa. 56, 569 A.2d 329,
331 (Pa. 1990) (quoting Commonwealth v. Revtai, 516 Pa.
53, 532 A.2d 1, 5 (Pa. 1987)). HN10 These same prin- ciples of statutory construction apply to DEP regulations as well. See 1 Pa. Code § 1.7; Bush v. Pa. Horse Racing Comm'n, 77 Pa. Commw. 444, 466 A.2d 254, 255-56 (Pa. Commw. Ct. 1983). **12
Instead of directly requiring that insurers notify the DEP upon cancellation of a policy, the text of § 86.168(d) provides that a permit applicant must secure a policy hav- ing a rider mandating notice to the DEP in the event of cancellation. The pertinent parts of § 86.168, read in con- junction, require the following: "A permittee shall submit proof of liability coverage . . . . The insurance shall include a rider requiring that the insurer notify the Department 30 days prior to substantive changes being made in the policy, or prior to termination or failure to renew." §§ 86.168(a)-
(d). HN11 The plain meaning of §§ 86.168(a) and (d) is that the permittee must obtain suitable insurance in or- der to obtain a permit and that the insurance, in order to
be suitable, must contain a rider requiring notice to the DEP. Section 86.168(d) places no direct obligation on the insurer. Indeed, when viewed in light of § 86.168(a), all of the provisions of § 86.168 speak to the obligations of permittees and permit applicants -- not to the obligations of insurers.
Moreover, if, as Utica and the Bowerses argue, the regulation did directly require that the insurer provide no- tice, the requirement that a **13 rider be included in the policy would be superfluous. HN12 "Such an interpre- tation would defy the axiom of statutory construction that
'whenever possible each word in a statutory provision is to be given meaning and not to be treated as surplusage.'
" Commonwealth v. Lassiter, 554 Pa. 586, 722 A.2d 657,
661 (Pa. 1998) (quoting In re Employees of Student Servs.,
495 Pa. 42, 432 A.2d 189, 195 (Pa. 1981)). The more log- ical explanation is that the DEP chose to place the burden on the insured to have the rider included in the policy and to have the policy form the basis of the insurer's duty. Thus, § 86.144 states that if the applicant wishes to have its application for a mining permit approved, "the amount, duration, form, conditions, terms, and method of proof of this insurance shall conform to § 86.168." This shows that the burden is on the permit applicant to have the rider placed in the insurance contract. Similarly, the require- ment that proof of suitable insurance be submitted with a permit application suggests that DEP's means of ensuring that it receives notice of cancellation is to deny any permit application that is not accompanied *284 by an insur- ance policy **14 imposing such a duty on the insurer. If the interpretation of § 86.168(d) advanced by Utica and Bowers were correct, the DEP would have no need to deny a permit application that was not accompanied by such a policy.
In concluding that the regulation itself imposed a no- tice requirement, the Magistrate Judge relied in part on 2
Couch on Insurance § 31:19 (3d ed. 1996), which states that "where statutory provisions require notice to a gov- ernment agency in order to effect a cancellation of policy, such notice must be given to effect a cancellation, and conversely there is no cancellation where notice is given merely in accordance with the provisions of the policy." This statement is inapplicable to Acceptance's situation. Section 31:19 concerns the effect of the failure to notify a government agency "where statutory provisions require notice to a government agency in order to effect a can- cellation of a policy." As discussed above, the relevant regulations here do not require notice to the DEP to ef- fect a cancellation of the policy. Rather, the regulations require that policies contain notification riders. It is note- worthy that none of the cases cited in Couch involved a situation analogous **15 to the one here, i.e., a situ- ation in which the law, rather than directly requiring the
263 F.3d 278, *284; 2001 U.S. App. LEXIS 18909, **15;
32 ELR 20228
Page 6
insurer to provide notice, required a notification rider to be included in the policy.
For similar reasons, Metro Transportation Co. v. North Star Reinsurance Co., 912 F.2d 672 (3d Cir. 1990), on which Utica and the Bowers rely, is not apposite.
HN13 In Metro Transportation, we noted that "when- ever a statute or insurance policy provides for notice of cancellation, Pennsylvania law has mandated that an in- surer's failure to comply with the provisions of the notice of cancellation results in the continuation of coverage re- gardless of any prescribed date of expiration." Id. at 682
(citations omitted) (emphasis added). We do not ques- tion that, if § 86.168(d) directly required Acceptance to provide notice of cancellation, then a failure to provide notice would have made an attempted cancellation inef- fective. However, the principle of Pennsylvania law stated in Metro Transportation does not apply where, as in this case, there is no statute or regulation requiring notifica- tion. n1 And, as we have stated, the policy contains no such requirement. We will not convert a statutory require- ment **16 of a rider into a mandate that the requisite language be deemed to be implicated in the policy if the rider is not in fact attached.
n1 The regulation in question in Metro Transportation required a taxi company to file a Uniform Carrier Bodily Injury and Property Damage Certificate of Insurance, known as a "Form E." "Form E . . . itself states that the insur- ance policy -- and hence the coverage provided by the policy -- cannot be canceled without first giv- ing the Pennsylvania Public Utility Commission thirty days sic notice." Id. at 678.
Our analysis of the text of § 86.168(d) is confirmed by a survey of analogous Pennsylvania regulations. In other similar areas, the DEP has explicitly placed the burden of giving notice directly on insurers. For example, the DEP has a permit system for the handling and disposing of residual waste. See 25 Pa. Code § 287.1 et seq.. Section
287.101 outlines the requirements for receiving a permit. One of the requirements is that an applicant must "comply
**17 with the . . . insurance requirements of Subchapter
E." Section 287.375, part of Subchapter E, states:
HN14
(b) The operator shall submit proof of insur- ance under § 287.373 (relating to proof of insurance coverage) . . . .
HN15
(c) The insurer may cancel or otherwise ter- minate an insurance policy by sending 60 days or other period prior written notice as may be authorized by the *285 Insurance
Department, to the Department and the op- erator, of the insurer's intention to cancel or otherwise terminate the insurance policy. The notice shall be sent to the Department and the insured by certified mail, return receipt requested. Prior to the cancellation or termi- nation becoming effective, the operator shall provide the Department with proof of a re- placement insurance policy sufficient to meet the requirements of this subchapter.
25 Pa. Code § 287.375(b)-(c) (emphasis added). This provision contrasts sharply with the regulation at issue in the present case. Whereas 25 Pa. Code § 287.375(c) places an obligation directly on the insurer to provide no- tice regardless of the provisions of the policy, 25 Pa. Code
§ 86.168 places an obligation on an applicant to have a rider requiring notice **18 placed in the insurance con- tract. See also 25 Pa. Code § 271.383(f)(2) (regulating municipal waste management); 25 Pa. Code § 271.392
(g)(2) (same).
Finally, we note that our interpretation of the reg- ulation is consistent with what we perceive to be the Legislature's objective, viz., ensuring that mining oper- ations are not conducted without the type of insurance deemed by the Legislature to be necessary. n2 That goal is fulfilled by requiring that the party applying for the mining permit obtain liability insurance. See §§ 86.67,
86.144. If the applicant has not obtained an insurance policy with a rider requiring notice of cancellation, the application should be rejected, and the applicant may not legally conduct a mining operation. See id. Thus, assum- ing that the DEP ensures that mining operations are not conducted without a permit, notification to the DEP of the cancellation of a policy is not necessary to prevent uninsured parties from conducting mining operations. Cf. Metro Transp., 912 F.2d at 681 (goal of notice require- ment for cancellation of automobile insurance policy for taxis is so that the State may revoke the taxi license if the insurance is canceled).
n2 Consideration of legislative intent is not nec- essary in this case since HN16 the Pennsylvania legislature has provided that "when the words of a statute are clear and free from all ambiguity, the letter of it is not to be disregarded under the pre- text of pursuing its spirit." 1 Pa. Code § 1922(b). However, we merely reconcile our interpretation with the general intent of the regulatory scheme in order to ensure that we effectuate the Pennsylvania Legislature's other mandates that HN17 (1) "the object of all interpretation and construction of statutes is to ascertain and effectuate the intention of the General Assembly," 1 Pa. Code § 1921(a);
263 F.3d 278, *285; 2001 U.S. App. LEXIS 18909, **18;
32 ELR 20228
Page 7
and HN18 (2) "the General Assembly does not in- tend a result that is absurd," 1 Pa. Code § 1922(1).
**19 III.
In sum, we hold that, under Pennsylvania law, a sur- face and underground coal mining general liability in-
surance carrier has a no duty to notify the DEP before effectively canceling an insurance policy unless a notifi- cation provision is included in the insurance policy. We therefore reverse the District Court's July 17, 2000, order granting summary judgment against Acceptance and re- mand this case to the District Court for entry of an order granting summary judgment in favor of Acceptance.
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