Good Faith Effort To Complete Service Required to Avoid Statute of Limitations Dismissal

In the case of Flanigan v. Ellwood City Hospital, No. 30007-CV-2017 (C.P. Lawrence Co. Feb. 6, 2019 Cox, J.), the court found that a Plaintiff did not attempt to complete service of a Writ upon a Defendant doctor in a medical malpractice action with good faith efforts such that the Plaintiff’s cause of action was deemed to be barred by the applicable statute of limitations.  

According to the Opinion, the Plaintiff was injured while riding a dirt bike and then sought medical treatment from the Defendant medical providers.  Although the Plaintiff was a minor at the time of the accident, he was coming up on the age of majority and, under 42 Pa. C.S.A. §5524 and 5533, the applicable statute of limitations on the Plaintiff’s cause of action was two (2) years from the date that he reached majority.  

The statute of limitations in this case was set to expire on June 18, 2017.   A Writ of Summons was timely filed two (2) days earlier on June 16, 2017.  

The Writ was served on some Defendants but there was no docketed Sheriff’s Return demonstrating service on one physician Defendant. 

According to the record before the court, the Sheriff’s office made an unsuccessful attempt to serve that particular Defendant doctor at a satellite office on July 16, 2017, thirty (30) days after the Writ had been filed.  

Three and half months thereafter, that Defendant doctor was served at his office in Pittsburgh.    The doctor acknowledged that he had been presented with service papers at his Pittsburgh office on October 27, 2017.  

The Plaintiff had filed a Complaint on September 12, 2017.   The Defendant doctor filed Preliminary Objections asserting that the Complaint was not timely filed and should be dismissed based upon the statute of limitations.  

Judge Cox of the Lawrence County Court of Common Pleas noted that a statute of limitations can be tolled by the filing of a Writ of Summons.   After a Writ is issued, a Plaintiff has thirty (30) days to serve the Writ under the Rules of Civil Procedure pertaining to service.    The court noted that the Writ may be reissued and that the tolling effect on the statute of limitations continues along with the reissuance of a Writ of Summons as long as a good faith effort is made to complete service.  

In an effort show good faith in this case, the Plaintiff submitted a document asserting that he, the Plaintiff, had asked his attorney multiple times to serve the Defendant doctor at his place of employment in Pittsburgh, but that the Plaintiff’s counsel had responded that the efforts to serve the doctor at the satellite office were legally sufficient.   According to the Plaintiff, service was finally made on the Defendant doctor after the Plaintiff begged his attorney to serve the doctor at his place of employment in Pittsburgh.

The court noted that, under Pennsylvania law, a client may be bound by the acts or statements of his attorney when such acts or statements are completed within the scope of the attorney’s authority.   The court found that, notwithstanding the Plaintiff’s personal efforts to push his attorney to complete service in another manner, the Plaintiff was bound by the actions, or inaction, of his counsel.  

Accordingly, the court did not consider the Plaintiff’s own actions while being represented by his attorney when assessing whether or not a good faith effort had been attempted to complete service.  

Consequently, since proper service was not made prior to the expiration of the statue of limitations, the court found that the Plaintiff failed to meet his burden of demonstrating evidence of actual notice on the part of the defense of the lawsuit or meet his burden of showing good faith attempts to complete service on that doctor.  

Given that it was found that the case was untimely filed, the court granted the Defendant doctor’s Motion to Dismiss. 

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Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (March 19, 2019).

Complaint Dismissed Due To Failure of Plaintiff To Conduct Good Faith Effort at Service of Process

In the case of Gussom v. Teagle, April Term 2018, No. 03821 (C.P. Phila. Co. Jan. 3, 2019 Patrick, J.), the court granted a Defendant’s Preliminary Objections seeking the dismissal of a Plaintiff’s Complaint for failure to complete service before the expiration of the statute of limitations.  

This matter arose out of a motor vehicle accident that occurred on July 26, 2016.   The Plaintiff filed a Complaint against the Defendant on April 26, 2018.   The Plaintiff was unable to complete service at the Defendant’s last known address in Philadelphia.  According to the Affidavit of Non-Service, the occupant of the last known address stated that the Defendant had relocated to Virginia.  

Several months later on August 22, 2018, which was after the expiration of the statute of limitations, the Plaintiff filed a Praecipe to Reinstate the Complaint. The defense responded with Preliminary Objections to the Complaint that was then filed in September of 2018.  

The Plaintiff did not respond to the Preliminary Objections. Instead the Plaintiff filed another Praecipe to Reinstate the Complaint in September of 2018.

The court sustained the Defendant’s Preliminary Objections in October of 2018, dismissing the Plaintiff’s Complaint in its entirety.   Two days later, the Plaintiff filed a Motion for Reconsideration which was also denied.  

The court reviewed Pennsylvania law requiring a good faith effort to complete service once an action was commenced.   The court found, in its sound discretion, that, under the facts presented, the Plaintiff’s inaction demonstrated an intent to stall the judicial machinery that the Plaintiff had set in motion.  

More specifically, the court pointed to the fact that, after the Plaintiff’s unsuccessful attempt to serve the Defendant at his last known address, there were no further efforts by the Plaintiff to locate and serve the Defendant.   The court also faulted the Plaintiff for not attempting to serve the Defendant by alternative means.   The court additionally noted that the two (2) Praecipes to Reinstate the matter were not filed timely.   

The court also noted that the Plaintiff did not file an Affidavit of the eventual completion of service until after the court had already sustained the Defendant’s Preliminary Objections.   The court found that, overall, the Plaintiff had failed to act in good faith in the efforts to complete service.  

The court also rejected the Plaintiff’s Motion for Reconsideration as no new facts or evidence were presented that would excuse the Plaintiff’s lack of a good faith effort to complete service on the Defendant prior to the expiration of the statue of limitations. 

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Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Jan. 29, 2019).

Criminal Convictions Found to Support Negligence per se Finding in Companion Civil Case

In the fraternity hazing case of Liu v. Pi Delta Psi Fraternity, Inc., No. 3028-CV-2015 (C.P. Monroe Co. March 21, 2019 Zulick, J.), Judge Arthur L. Zulick of the Monroe County Court of Common Pleas addressed a Plaintiff’s use of the doctrine of offensive collateral estoppel by way of a Motion for Summary Judgment seeking a finding of liability against certain fraternity Defendants based upon prior criminal convictions and/or pleas of guilty relative to the hazing charges arising out of the same incident.

According to the Opinion, this case arose out of fatal injuries to a pledge to a fraternity at Baruch College in New York City.   The fraternity had rented a house in Monroe County over a weekend for initiation rituals.  

After the Plaintiff’s decedent sustained fatal injuries allegedly as a result of the initiation rituals, a personal injury action was brought against the fraternity and various members of the fraternity.   

In separate proceedings, criminal charges were brought against the fraternity and 37 individuals.  

One of the Defendants at issue with respect to the Motion for Summary Judgment had entered a guilty plea to conspiracy to hinder apprehension/conceal evidence, and conspiracy to commit hazing.  

The fraternity itself went to trial and was convicted of multiple counts, including aggravated assault, conspiracy to commit aggravated assault, and hazing.  

The Plaintiff filed a Motion for Summary Judgment arguing that the Defendants at issue, who had been previously convicted of charges and/or who pled guilty to charges in the criminal case should be deemed to be negligent per se in this civil lawsuit.

Judge Arthur L. Zulick

After reviewing the law pertaining to negligence cause of actions and negligence per se, the court ruled that summary judgment would be entered in favor of the Plaintiff due to the Defendants’ convictions for conspiracy to haze the Plaintiff, which convictions were found to supply the basis for a determination of a breach of duty in this negligence cause of action.  

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SAVE THE DATE: June 10, 2019 LACKAWANNA PRO BONO GOLF TOURNAMENT

Entrustment Clause of Property Damage Policy Upheld To Preclude Coverage For Acts of Vandalism To Rental Property

In the case of KA Together, Inc. v. Aspen Specialty Ins. Co., No. 18-CV-142 (E.D. Pa. Jan. 24, 2019 Slomsky, J.), the court granted a Defendant carrier’s Motion for Summary Judgment on a property damage insurance claim presented by the Plaintiff for water damages.  

According to the Opinion, the Plaintiff alleged claims for breach of contract and bad faith stemming from a Defendant’s denial of an insurance claim made by the Plaintiff for losses at the Plaintiff’s property.   The Plaintiff had filed the insurance claim for water damage caused by two (2) individuals who had been residing in a third floor apartment on the property.  

The Defendant carrier filed a Motion for Summary Judgment asserting that the Plaintiff’s claims were barred by the “entrustment exclusion” of the insurance policy at issue, which expressly excluded coverage for all losses resulting from dishonest or criminal acts by person to whom the Plaintiff entrusted the property.  

The Plaintiff opposed the Motion for Summary Judgment by arguing that the entrustment exclusion did not apply because the Plaintiff never entrusted the property to the two (2) individuals responsible for causing the water damages.  

By way of further background, the property at issue was a mixed commercial residential building.   There was a rental apartment of the third floor.   The carrier insured the property with a commercial property policy which, as noted, included an “entrustment exclusion” which allowed the carrier to deny coverage for any losses resulting from dishonest or criminal acts by the insureds or anyone to whom the insured entrusted the property for any purpose.  

According to the Opinion, at some point, the person who had signed a Lease for the third floor apartment had his girlfriend move into the apartment.  Thereafter, the tenant and his girlfriend were arrested on separate criminal charges and removed from the property.   

The manager of the property was then made aware that another person claimed that he had signed a sublease for the apartment with the girlfriend.   That person was told that the Lease Agreement with the girlfriend would not be accepted by the landowner as the girlfriend had no authority to sublease the property to that person.  

After that person was asked to leave the premises, the landowner received a phone call the day after the person vacated the premises from the business that operated in the same building at the first and second floor, claiming that there is water flowing and flooding down into the office and store.   

When the manager went to the property, he found that there were three (3) sources of running water with the drains purposefully blocked in the third floor apartment.   The manager called the police and filed an incident report.   Thereafter, the insurance claim was submitted to the carrier.  

The landowner believed that the damage was covered under the policy as an act of vandalism. However, as noted above, the carrier relied upon the entrustment exclusion to deny coverage.   

The court found that the entrustment exclusion was not ambiguous and must be enforced.   The court emphasized that the entrustment exclusion broadly applies to dishonest or criminal acts by “anyone to whom [the landowner] entrust[s] the property for any purpose.”   The court ruled that, under the plain meaning of the policy, the carrier is entitled to summary judgment under the exclusion at issue.  

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There Can Be No Bad Faith Where Policy Was Properly Cancelled

In the case of Chad & Ashley, Inc. v. White Pine Ins. Co., No. 1110-CV-2016 (C.P. Lawrence Co. Dec. 19, 2018 Cox, J.), the court granted an insurance company’s Preliminary Objections seeking the dismissal of a Plaintiff’s claims for breach of contract and bad faith in a property damage case. 

According to the Opinion, the Plaintiff brought this action against the carrier for breach of contract and bad faith due to the carrier’s alleged failure to cover a total loss of the Plaintiff’s property.  

The court confirmed that the record before it established that the carrier had sent the Plaintiff a cancellation notice which confirmed an end date of the insurance policy that was approximately two (2) weeks prior to the date of the loss.  

Plaintiff’s counsel attempted to argue that the cancellation notice could be interpreted to instead provide the Plaintiff with a fifteen (15) day notice such that the policy would still be in effect slightly beyond the date of the loss.  

The court disagreed with the Plaintiff’s reading of the cancellation notice.   The court also noted that the insurance contract itself provided only for a ten (10) day period of notice.   As such, the court granted the Defendant’s Preliminary Objections and dismissed the breach of contract claim.

Relative to the bad faith claim, the court noted that, because the insurance contract was not in effect at the time of the loss, the Plaintiff was unable to show the first element of a bad faith claim, i.e., that the insurer did not have a reasonable basis to deny benefits under the policy.   As such, the bad faith claim was dismissed as well. 

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Source:  “Digest of Recent Opinions.”  Pennsylvania Law Weekly (March 12, 2019).

Nonsuit in Declaratory Judgment Action on Coverage Affirmed Based On Definition of "Occurrence"

In the case of Kiely v. Phila. Contrib. Ins. Co., 2019 Pa. Super. 90 (Pa. Super. March 26, 2019 Ott, J., Dubow, J. Stevens, P.J.E.)(Op. by Dubow, J.), the Pennsylvania Superior Court affirmed a trial court’s entry of compulsory non-suit in favor of the carrier on a coverage question arising out of a homeowner’s policy and/or an umbrella policy. 

According to the Opinion, an insured who was covered a homeowner’s policy and an umbrella policy issued by the same carrier was sued in an underlying litigation by a former domestic employee, who asserted claims of assault and intentional infliction of emotional distress.   The insured had tendered the lawsuit to the carrier for a defense. The carrier denied coverage, asserting that the intentional torts alleged in the underlying Complaint were not “occurrences.” 

The insured then commenced this coverage litigation against the carrier seeking a declaration that the carrier was obligated to defend and indemnify the insured on the claims presented.  The insured also sought damages for bad faith.  

The coverage litigation proceeded to a trial.  At trial, the trial court permitted the insured to introduce evidence that evidence that he (the insured) lacked the mental capacity sufficient to intentionally assault the Plaintiff in the underlying matter.

The trial court entered a nonsuit in favor of the carrier after finding that the insured failed to introduce evidence of an “accident” which was required in order to trigger coverage under the policy for an “occurrence.”  

On appeal, the Superior Court affirmed the trial court’s entry of a compulsory nonsuit.   The court held that the insured’s alleged assault upon the underlying Plaintiff was not an “accident; rather, it was an intentional tort.”   Accordingly, given that the policy defined an “occurrence” as an “accident,” and given that the no accident or occurrence was alleged in the underlying personal injury Complaint, the Superior Court agreed that the carrier did not owe any duty to defend or indemnify under the policy.  

In addition to upholding the trial court’s entry of a compulsory nonsuit, the Superior Court additionally held that it was improper for the trial court to have permitted the insured to introduce evidence that the insured lacked the mental capacity to commit intentional torts.

The Superior Court noted that in a declaratory judgment action concerning insurance coverage issues, the allegations in the underlying personal injury Complaint control the analysis and that extrinsic evidence could not be admitted while the underlying lawsuit was still pending.  Simply put, in a coverage action, the essential analysis required involved comparing the allegations of the underlying Complaint to the insurance policy to determine if the coverage provisions were triggered.

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I send thanks to Attorney Benjamin P. Novak, Esquire of the Lancaster, Pennsylvania office of Fowler, Hirtzel, McNulty & Spaulding, LLP, for bringing this case to my attention.