TORT TALK TIP

TRY TO LIMIT YOUR TIME ON EMAIL

As hard as it may be at times, it may be beneficial to your time management to limit your time on your email at the office.  Everyone likes to receive and read email -- it makes you feel needed, wanted, and it is interesting to see what's coming in.

But reading and responding to email can take up a lot of time.

Some recommend, as best as you can, to limit your email reading and responding to a set time in the morning, and another set time in the latter part of your afternoon. 

One way to stay away from your email in order to do other work is to do just that --- set up another work station away from your desktop computer and phone.  You may find that you will get a lot of your other work done this way.

Motion to Sever Negligence and UIM Claims Denied in a Philadelphia County Post-Koken Case

In the Philadelphia County Court of Common Pleas case of Leone v. Ellingberg and Allstate, No. 180802705 (C.P. Phila. Co. Nov. 5, 2018 Younge, J.), the court denied the carrier’s Motion to Sever the Plaintiff’s negligence claims from the UIM claim breach of contract claims by Order only.

 

Please email me at dancummins@comcast.net if you would like me to email you a copy of this Order.

 There continues to be a split of authority in the Philadelphia County Court of Common Pleas.  Check out the Post-Koken Scorecard on the Tort Talk Blog down on the right hand column of the blog at www.TortTalk.com.

 

I send thanks to Attorney Clancy Boylan of the Philadelphia law firm of Morgan & Morgan for bringing this case to my attention.  

 

 

Propriety of New Matter Pleading Addressed By Judge Zulick of Monroe County

The propriety of pleadings in a New Matter contained in an Answer and New Matter to a Complaint were addressed by Judge Arthur K. Zulick of the Monroe County Court of Common Pleas in the case of Higgins v. Jimenez, No. 429 CV 2016 (C.P. Monroe Co. Aug. 24, 2018 Zulick, J.).  

This matter arose out of a motor vehicle accident.  

In response to the Complaint, the Defendant filed an Answer and New Matter in which he denied liability and asserted affirmative defenses.  In the New Matter, the Defendant generally alleged that the claims in the Plaintiff’s Complaint were barred or limited by accord and satisfaction, release, res judicata, collateral estoppel, arbitration and award, latches, and “any other affirmative defenses set forth in Pa.R.C.P. 1030(a).”  

The Plaintiff filed Preliminary Objections asserting that this boilerplate language contained in the New Matter was insufficient under the fact-pleading requirements of the Pennsylvania Rules of Civil Procedure.  

In the Brief in Opposition, the defense argued that, under the Rules of Civil Procedure, the Plaintiff was not even required to respond to the affirmative defenses contained in the new matter when they only contain conclusions of law as, under the Rules, such affirmative defenses would be deemed denied.  

The Defendant also asserted that, although a Plaintiff may have a long time to prepare a Complaint, a Defendant’s pleading in response to the Complaint had to be filed within only twenty (20) days of service of the Complaint.   As such, the defense argued that this short period of time did not provide the defense with time to investigate all potential affirmative defenses or gather facts in support of the same.

In this regard, it was additionally noted that a failure to raise affirmative defenses could result in a waiver of such defenses under the Rules.   For these reasons, the defense asserted that there conclusory defenses set forth in the New Matter should not be deemed to be objectionable at this stage of the litigation.

Judge Arthur K. Zulick
Monroe County
 

Judge Zulick agreed that the better approach was to allow for the raising of affirmative defenses as conclusions of law without the need for specific facts to support them at the time of the filing of the New Matter. 

The court went on to state that, at a later point in the proceedings, any affirmative defenses that remain without adequate factual support could be dismissed by way of a pre-trial motions.  

As such, the court allowed the specific affirmative defenses identified by the defense, but it granted the Plaintiff’s Motion to Strike the Catchall Allegation of “and any other affirmative defenses set forth in Pa.R.C.P. 1030(a) as that particular allegation was too vague. 

In his opinion, Judge Zulick emphasized that the court expected counsel to raise affirmative defenses in good faith and with a reasonable anticipation that they were, or could be, supported by facts.    The court noted that baseless pleadings could be subject to sanction by the court and attorney’s fees under 42 Pa. C.S.A. §2503(7).  

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

Source: “Digest of Recent Opinions.”  Pennsylvania Law Weekly (October 2, 2018).

Check Out the New Search Tools on the Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog

Attorney Lee Applebaum, the creator and writer of the EXCELLENT Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog has put up a blog post outlining different search options for that blog to make it easier for readers to search through the content on that blog.

Here is a LINK to that blog post -- I encourage you to check it out and to keep his blog in mind should you ever need to kickstart your research on an insurance bad faith issue, whether it be for an auto insurance, homeowner's insurance, commercial insurance, disability insurance issue or any other type of insurance.

Judge James M. Munley of Federal Middle District Court Rules on Statute of Limitations for UIM Case

In a case in which he addressed the applicable statute of limitations for an underinsured (UIM) motorists claim, Judge James M. Munley of the Federal Middle District Court of Pennsylvania denied the carrier’s Motion for Summary Judgment in the case of Legos v. Travelers Cas. Ins. Co., No. 3:16-CV-1917 (M.D. Pa. Oct. 11, 2018 Munley, J.).

Notably, the court held that the statute of limitations for a UIM is four (4) years from the date of the breach of the contract and not the date of the third party settlement.  

According to the Opinion, the third party case in this matter settled back in March of 2012.   

Over four (4) years later, Travelers sent correspondence to its insured indicating that it believed that the statute of limitations on the UIM claim had expired and that it was, therefore, closing its file.  

The insured nevertheless filed a breach of contract Complaint.   Travelers eventually responded with a Motion for Summary Judgment asserting that the four (4) years statute of limitations had expired once four (4) years from the March of 2012 settlement of the case had run.  

The Plaintiff countered with the Pennsylvania Supreme Court case of Erie Ins. Exch. v. Bristol, 174 A.3d 578 (Pa. 2017), and asserted that the four (4) year statute of limitations actually commenced in 2016 when the carrier indicated that it was closing its file as that would have been the date of the alleged breach of contract.  

Travelers responded by asserting that the Bristol case only applied to uninsured (UM) motorists claims.  Judge Munley disagreed and held that the Bristol case applied to both UM and UIM cases.  

In a footnote, Judge Munley acknowledged the Third Circuit's 2007 prediction in 

State Farm Mut. Auto. Ins. Co. v. Rosenthal, 484 F.3d 251, 253 (3rd Cir. 2007), that the Pennsylvania Supreme Court would hold that the limitations period on a UIM claim begins to run when the insured party settles with an adverse party for less than the value of the insured's damages. However, Judge Munley ruled that the 2017 Pennsylvania Supreme Court decision in Erie Ins. Exch. v. Bristol, 151 A.3d 1161 (Pa. Super. Ct. 2016), rev'd, 174 A.3d 578 (Pa. 2017) served to clarify state law in the manner held by Judge Munley in this Legos case.

As such, the court found that the UIM breach of contract claim in this matter was not barred by the statute of limitations.   Consequently, the carrier’s Motion for Summary Judgment was denied.

Anyone wishing to review a copy of this case may click this LINK. The Court's companion Order can be viewed HERE.

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

Commentary:  One troubling aspect of this decision for carriers is that Plaintiffs attorneys are already arguing that this decision basically eradicates any statute of limitations for a UIM claims.  The argument is that, under this decision, the statute of limitation never begins to run until the Plaintiff advises the carrier of a desire to pursue a UIM claim and the carrier denies the claim or indicates it is not going to pay the Plaintiff's initial demand.

Does such an argument further the goal of the statute of limitations to prevent the pursuit of overly stale claims?  Does that seem like a correct application of the statute of limitations to you?  What do you think?

Low Offer Possibly Not Supported by the Record - Bad Faith Claim Allowed to Proceed

A bad faith homeowner’s insurance claim was allowed to proceed into discovery after the carrier’s Motion to Dismiss the Plaintiff’s federal court Complaint was denied in the case of Meiser v. State Farm Fire & Cas. Co., No. 3:17-2366 (M.D. Pa. Sept. 28, 2018 Mannion, J.).  

According to the Opinion, the case arose out of an incident during which a truck crashed into the insured’s home.

The insured’s own carrier evaluated the damage as being less than $2,500.00, which came to less than $600.00 after deductibles.  

The court noted that the tortfeasor’s carrier had evaluated the damages to the house at $60,000.00, based upon a finding a structural damage. Also, the Plaintiff’s public adjuster and another entity evaluated the damages at approximately $40,000.00.   The Plaintiff’s carrier allegedly did not revise its evaluation even after being provided these other estimates.

The insured brought a lawsuit against his own carrier for breach of contract and bad faith.   The issue came before the court on the Defendant’s Motion to Dismiss the bad faith claim.  

Judge Malachy E. Mannion
M.D. Pa.

In his Opinion, Judge Mannion provided a nice overview of the elements of a statutory bad faith claim and noted the demanding standard of clear and convincing evidence required in such cases.  

The Defendant carrier asserted that it was willing to pay the claim but that there was only a disagreement with the insured as to the amount offered.  The carrier asserted that this did not constitute bad faith and relied upon the principle of law that low but reasonable offers cannot be deemed to be bad faith as a matter of law.  

The carrier additionally argued that the Plaintiff’s Complaint only contained conclusory allegations of bad faith and should be dismissed on that basis as well.  

The court denied the Motion to Dismiss after finding that the Plaintiff had pled sufficient facts to support the bad faith claim.   The court also disagreed with the characterization of the pleadings as merely indicating that the carrier’s estimate was low but reasonable.   

Rather, based upon the court’s review of the Complaint, it appeared that the Plaintiff was asserting that there was an extreme disparity between the carrier’s estimate and the other estimates which may suggest something more than mere negligence.  

The court also noted that the motion was being dismissed as several of the issues raised required further discovery to address the same, including with respect to the Plaintiff’s bad faith allegations that the carrier was unreasonable in failing to re-investigate and re-evaluate the damages asserted in light of the new information generated in the claim.  

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

I send thanks to Attorney Lee Applebaum of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law blog for highlighting this case on his blog, which can be viewed HERE.

Low Offer Supported by Record - No Bad Faith

In his recent decision in the case of Newhouse v. GEICO, No. 4:17-cv-00477 (M.D. Pa. Oct. 12, 2018 Brann, J.), Judge Matthew W. Brann granted the carrier’s Motion for Partial Summary Judgment on a bad faith claim asserted in a post-Koken UIM matter.  

According to the Opinion, the Plaintiff was allegedly injured as a result of a rear-end accident caused by an intoxicated driver.  After recovering the $15,000.00 policy limit from the tortfeasor’s carrier, the Plaintiff submitted a claim for UIM coverage for his own carrier.    Although the Plaintiff was seeking to recover the $200,000.00 UIM policy limits, GEICO had offered $10,000.00 based upon the case presented.  

The Plaintiff thereafter filed a Complaint in Clinton County for breach of contract, bad faith, and loss of consortium.   The carrier removed the case to federal court.  The issue of the validity of the Plaintiff’s bad faith claim eventually came before the court by way of a Motion for Summary Judgment.

Judge Matthew W. Brann
M.D. Pa.

In his Opinion, Judge Brann reviewed the current status of Pennsylvania bad faith law as applied against the record before the court.  

In granting the Motion for Partial Summary Judgment on the bad faith claims, the court noted that two (2) doctors, including the Plaintiff’s own medical expert, believed that a pre-existing medical condition of the Plaintiff contributed to the Plaintiff’s current complaints.   

Reviewing the totality of the circumstances, the court noted that, while the UIM carrier’s offer fell short of satisfying a vocational expert’s six-figure loss calculation, the UIM carrier was not prohibited from considering the doctors’ opinions regarding the causation issue.   

Accordingly, the court found that reasonable minds could differ as to the true sum of the Plaintiff’s losses.  More specifically, the court ruled that it could not be said that GEICO’s evaluation was “frivolous or unfounded” as required by bad faith law to support a claim presented under the heightened burden of proof of clear and convincing evidence of bad faith.  As such, the court granted the Motion for Partial Summary Judgment on the bad faith claim.

Anyone wishing to review this decision may click this LINK.  The Court's Order can be viewed HERE.

I send thanks to Attorney Joseph Hudock of the Pittsburgh law firm of Summers, McDonnell, Hudock, Guthrie & Rauch, P.C., for bringing this case to my attention.