Judge Nealon of Lackawanna County Addresses Coverage Issues in a Declaratory Judgment Action

In the case of Penn National Ins. Co. v. Kapinus, No. 2016 - CV - 3379 (C.P. Lacka. Co. July 12, 2017 Nealon, J.), Judge Terrence R. Nealon sustained in part and denied in part an insured's Preliminary Objections in a declaratory judgment action on coverage.

In this matter a commercial insurance carrier who issued a liability policy to business owned by the father of a personal injury plaintiff filed a declaratory judgment seeking a judicial declaration that it need not provide coverage on the son's claims given that the father misrepresented information as to whether his son had worked for the father's business in the past.

In his preliminary objections, the son asserted that material misrepresentations in this context must relate to the application for insurance and not to alleged fraud in the later prosecution of a claim. Judge Nealon disagreed with this assertion and denied the preliminary objections in this regard.

The court did sustain the son's preliminary objections that asserted the the duty to cooperate under the policy only pertained to the defense of the underlying matter and not with respect to the carrier's efforts to gather information with respect to a decision to deny coverage under the policy.

Anyone wishing to review this opinion by Judge Nealon in the Kapinus case may email me at dancummins@comcast.net.