Friday, May 22, 2020

A Vote for Tort Talk?

The Pennsylvania Law Weekly has opened up the voting for its "Best of 2020" poll.  

Hoping you might please consider voting for the "Tort Talk Blog" as a write-in vote under question No. 57 for one of the top Online Research Service platforms in Pennsylvania.

Here is the LINK to the Poll.

Thanks very much.

The Long Arm of the Law Hales NY Attorney Into Court in Pennsylvania

In the legal malpractice case of Rock v. Russo, No. 7605-CV-2019 (C.P. Monroe Co. March 6, 2020 Zulick, J.), the court addressed issues pertaining to jurisdiction over a non-resident under the long-arm statute and based upon minimum contacts by the Defendant attorney in Pennsylvania. 

According to the Opinion, the New York attorney was representing the Plaintiff in a personal injury matter arising out of an incident that occurred in Pennsylvania. 

The attorney allegedly initially represented the Plaintiff and pursued the claim but then allegedly advised the Plaintiff that he was terminating his representation. According to the Plaintiff, the New York attorney allegedly mistakenly advised her on the applicable statute of limitation and, as a result, the Plaintiff was barred from pursuing her claim.

The Plaintiff filed this legal malpractice suit. The Defendant responded with Preliminary Objections to the Complaint, arguing, in part, that the court could not execute jurisdiction over the New York attorney or his firm because the Defendant did not have sufficient minimum contacts with Pennsylvania. 

While the court noted that the Defendants had demonstrated that there had been no continuous and systematic business contacts by the firm within Pennsylvania, the court still found that the Defendants availed themselves to the foreign state and established minimum contact to support in personam jurisdiction by undertaking the representation of a client who had been injured in Pennsylvania. As such, the Defendant’s Preliminary Objections were overruled. 

Anyone wishing to review this decision may click this LINK.   

Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (May 12, 2020).

Motion to Dismiss Granted in Products Case Based on Jurisdictional Issues

In the case of Winters v. Akzo Nobel Surface Chemistry, LLC, No. 19-5398 (E.D. Pa. April 27, 2020 Schmehl, J.), the court granted a Motion to Dismiss filed by a product manufacturer on the basis that the manufacturer was not subject to personal jurisdiction in Pennsylvania. 

In its decision, the court ruled that the Plaintiff could not rely upon a stream of commerce argument as a basis for specific jurisdiction.

The court also noted that the Plaintiff’s efforts to establish jurisdiction under Pennsylvania long-arm statute did not prevail. 

The court also held that jurisdiction may not be based upon a Defendant entering into contracts with Pennsylvania companies, since third party contacts are not relevant to the issue of personal jurisdiction. 

The court additionally held that an unrelated office of the Defendant located in Pennsylvania did not suffice to serve as a relevant contact. 

The court granted the Motion to Dismiss and severed the action against the product manufacturer and transferred that part of the case to Delaware, where that manufacturer was incorporated. 

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

I send thanks to Attorney James M. Beck of the Philadelphia office of the Reed Smith law firm for bringing this case to my attention.

Jurisdiction by Consent Concept Upheld in Two Recent Federal Court Cases

In two (2) recent Federal Pennsylvania District Court Decisions, separate courts held that the Third Circuit’s decision in the Bane case, recognizing general jurisdiction by consent, conferred by virtue of a foreign corporation’s securing a registration to do business in Pennsylvania, remains binding. 

This rule of law was relied upon in the case of Smith v. NMC Wollard, Inc., No. 19-5101 (E.D. Pa. April 24, 2020) as well as in the case of Replica Auto Body Panels & Auto Sales, Inc. v. InTech Trailers, Inc., No. 4:19-CV-02018 (M.D. Pa. April 16, 2020 Brann, J.). 

Anyone wishing to review a copy of the Smith decision may click this LINK  and this LINK for the companion Order.  

The Replica Auto decision can be read at this LINK and the companion Order at this LINK

I send thanks to Attorney James M. Beck of the Philadelphia office of the Reed Smith law firm for bringing this case to my attention.

Thursday, May 21, 2020

When Is A Statement in a Pleading a Judicial Admission? (Non-Precedential)

In the case of Huchko v. Blouent International, No. 1281 WDA 2019 (Pa. Super. March 13, 2020 Pellegrini, J., Bowes, J., and Bender, P.J.E.) (Op. by Pellegrini, J.) (Non-Precedential), the court reviewed the proper analysis to determine whether an allegation in a Complaint may be determined to date a judicial admission by a Plaintiff.

According to the Opinion, the Plaintiff sued the Defendants for alleged faulty maintenance of a tractor’s brake system. The jury entered a verdict in favor of the Plaintiff.

On appeal, one of the Defendants argued that the trial court had erred in denying the Defendant’s Motion In Limine to preclude the Plaintiff from testifying at trial in contradiction to an allegation in the Plaintiff’s Complaint.

The Defendant asserted that in a paragraph of the Plaintiff’s Complaint, the Plaintiff had asserted that he had been run over while trying to stop a moving tractor, but that, it was anticipated that, at trial, the Plaintiff would testify instead that the tractor was stationary when he tried to climb into it after which it then began to roll down a slope and then ran him over.

The defense asserted that the allegation in the Plaintiff’s Complaint constituted a judicial admission that was binding on the Plaintiff’s trial testimony.

On appeal, the Superior Court affirmed the trial court finding that the allegations at issue in the Plaintiff’s Complaint did not amount to a judicial admission.

The rationale of the court was that a key element of a judicial admission was that the fact to be admitted must be admitted for the advantage of the admitting party.

In this case, the Superior Court agreed with the trial court that the interpretation of this allegation in the Complaint as advanced by the defense, i.e., that the Plaintiff tried to get on to the tractor while it was moving, was not advantageous at all to the Plaintiff. The Superior Court agreed with the trial court that, since this allegation was not advantageous to the Plaintiff, the trial court had properly found that it could not constitute a judicial admission that precluded the Plaintiff testifying at trial regarding how he sustained his injuries.

The Superior Court also noted that the allegations contained in the Complaint also did not amount to a “clear and unequivocal admission of fact” as required by past precedent to allow for a statement in a pleading to serve as an admission of fact.

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

Source: Article “Finding Plaintiff’s Testimony Didn’t Contradict Complaint, Superior Court Affirms $2.2 M verdict,” by Zack Needles of the Pennsylvania Law Weekly (April 16, 2020).

Wednesday, May 20, 2020

Eastern District Federal Court Judge Allows Bad Faith Claim To Proceed Based Upon Carrier's Reliance Upon Household Exclusion

In the case of Smith v. AAA Interinsurance Exchange of the Automobile Club, No. 20-768 (E.D. Pa. May 6, 2020 Moore Wells, M.J.), a Federal District Court Magistrate Judge denied a Motion to Dismiss a Breach of Contract and Bad Faith Claim arising out of UIM matter. 

According to the Opinion, the carrier's denial of the claim was based solely upon the policy’s household exclusion. It was noted that, months before this issue came before this court, the Pennsylvania Supreme Court had generally eradicated the household exclusion’s application under Pennsylvania law under similar circumstances at issue in the case of Gallagher v. Geico

The court denied the Motion to Dismiss after finding, in part, that the carrier was fully on notice that the household exclusion was invalid under Pennsylvania under the circumstances presented. The court also noted that the record indicated that the insured’s counsel has brought the issue of the eradication of the household exclusion to the carrier’s attention when the claim before the coverage decision was made. 

The Federal District Magistrate Judge rejected the carrier’s argument that the Gallagher decision only applied to the unique facts at issue in the Gallagher case. 

The court otherwise found that the Complaint contained sufficient facts to support an allegation that the carrier did not engage in reasonable investigation efforts prior to denying the coverage. In this regard, the court noted that the carrier had denied the claim eleven (11) days after it was presented and had not otherwise produced any contrary medical documents or required a medical examination. 

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

I send thanks to Attorney Lee Applebaum for bringing this case to my attention through his excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law blog.

Pennsylvania Western Federal District Court Punts Covid-19 Related Business Interruption Insurance Coverage Question Back to State Court

A Western Federal District Court rejected an effort by a carrier to remove a Covid-19 Business Interruption Insurance coverage case in the matter of Danoia's Eatery, LLC v. Motorists Mutual Ins. Co., No. 20-706 (W.D. Pa. May 19, 2020 Fischer, S.J.),

The Plaintiff's Declaratory Judgment Complaint sought a declaration that the carrier was required to provide insurance coverage for business interruption losses brought on by the mandated government closures due to the Covid-19 pandemic.

Notably, the Court issued the Order to remand the case sua sponte even before the Plaintiff filed any Motion to Remand after the carrier had filed its Notice of Removal.

The court went through the standard of review under 28 U.S.C. Section 1447(c) and emphasized that the federal courts are courts of limited jurisdiction.

The Court noted that it had questions as to whether there was complete diversity between the parties to enable the Court to exercise subject matter jurisdiction over the case.

Significantly, the Western Federal District Court also noted that, even if there was diversity, the Court would still choose to exercise its discretion under the Declaratory Judgment Act not to exercise jurisdiction over the Covid-19 business interruption coverage question presented due to the fact that Pennsylvania state law on the issue was unsettled.

The Court held that the "Plaintiff's Complaint raises novel insurance coverage issues under Pennsylvania law which are best reserved for the state court to resolve in the first instance."  See Op. at p. 5.

Anyone wishing to review this case may click this LINK.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA law firm of Schmidt Kramer for bringing this case to my attention.