Sunday, March 31, 2019

Pike County Joins Majority of Trial Courts in Favor of Severance/Bifurcation of Bad Faith Post-Koken Claims

In a detailed Order recently entered in the Post-Koken case of Hansen v. Fucetola and NJM Ins. Co., 1079-2014-Civil (C.P. Pike Co. Feb. 26, 2019 Chelak, J.), Judge Gregory H. Chelak of the Pike County Court of Common Pleas granted a UIM carrier's Motion to Sever and Stay the Plaintiff's Bad Faith Claim From the Plaintiff's Breach of Contract Claim.

The court relied upon Pa.R.C.P. 213(b), which grants the trial court power to bifurcate or sever matters, and ruled that severance was the most prudent action under the circumstances presented in this case. 

In this regard, the court noted that the failure to sever the bad faith claim could prejudice the UIM carrier in front of a jury in the carrier's defense of the breach of contract UIM claim.  The court also found that there would be no prejudice to the Plaintiff in granting the severance of the bad faith claim. 

Judge Gregory H. Chelak
Pike County
Judge Chelak additionally noted that the granting of the severance motion would advance the interests of judicial economy and foster a more efficient and speedy resolution of the underlying claims presented.  In the court's opinion, the UIM claim would be able to be resolve or concluded more promptly if the bad faith claim was severed.

Notably, Judge Chelak's Order not only results in the severance of the claims for purposes of discovery but also specifically holds that the bad faith claim was bifurcated for purposes of any eventual trial.  An additional rationale for his ruling was that the bifurcation of the bad faith claim from the trial on the third party and UIM claims would avoid confusion on the part of the jury.

Judge Chelak concluded his Order by mandating that all discovery on the bad faith claim was stayed pending the resolution of the third party negligence and UIM claims.

Anyone wishing to review Judge Chelak's detailed Order in the Hansen case may click this LINK.

Commentary:  As there still remains no appellate guidance on the issue of severance/bifurcation of bad faith claims in Post-Koken matters, and/or whether bad faith discovery should be stayed pending the resolution of the companion UIM claim, there continues to be a split of authority.  With the above decision, Pike County lands on the majority side of those county courts that favor severance, bifurcation and stay Orders relative to bad faith claims.

This case will be added to the list of decisions noted on the Tort Talk Post-Koken Scorecard which can be viewed HERE.

According to the Post-Koken Scorecard, twice as many county courts favor the severance of bad faith claims (21) when compared to those county courts (10) that elect to keep the claims consolidated.

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