Wednesday, April 17, 2019

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. 

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

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. 

Anyone wishing to review this case may click this LINK.

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

Monday, April 15, 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.  

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

Tuesday, April 9, 2019

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.  

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

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. 

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

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

Monday, April 8, 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.

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

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.

Thursday, April 4, 2019

Dog Bite Claims Against Landlord Dismissed in Monroe County

In the case of Gallo v. Precise Moments Academy, No. 904-Civil-2018 (C.P. Monroe Co. Jan. 4, 2019 Harlacher Sibum, J.), Judge Jennifer Harlacher Sibum of the Monroe County Court of Common Pleas ruled that a landlord was not liable under state dog law or agency principles where a tenant's dog bit a child at a leased daycare facility.  

The court found that the Plaintiff failed to allege specific facts to support any claims of negligence or punitive damages against the landlord.  

According to the Opinion, the Plaintiffs were parents of a minor child who attended a daycare facility.   A dog owned by one of the tenants who ran the facility bit the minor child while she was at the daycare resulting injuries to the child’s face. 

In addition to suing the tenants, the Plaintiffs sued the landlord who owned the property on which the daycare facility was located.   The Plaintiffs alleged that the landlord negligently and recklessly maintained dangerous dogs on the daycare premises despite the substantial risk of injury to children.  The case came before the court by way of the landlord’s Preliminary Objections.  

Initially, the landlord asserted that the dog law in Pennsylvania did not apply given that the landlord was not an “owner” of the dog as required for the application of that statute which required dog owners to confine, secure or otherwise control their dogs.  

The court agreed with the landowner Defendant in this regard and noted that prior case law had held that a landlord out-of-possession, without more, was not considered the owner of a tenant’s dog under that dog law.   The court stated that the Plaintiffs presented no other facts in support of its legal conclusion assertions in the Complaint that the landlord housed and kept the dog.  

The court also agreed with the landlord Defendant’s argument that the Plaintiffs’ allegations of agency should be stricken because there were no facts to support allegations of vicarious liability.   The court noted that the Complaint did not identify any agency relationship between the landlord and its tenants.  

Judge Jennifer Harlacher-Sibum
Monroe County

Judge Harlacher Sibum additionally found that the catch-all phrasing of negligence in the Plaintiff’s Complaint against the landlords was insufficient under Pennsylvania law.  

The court also agreed with the landlord Defendants’ contention that the Plaintiffs’ claims for punitive damages should be stricken for insufficient specificity where the Plaintiff failed to allege that the landlord acted with any bad motive.   The court reiterated that the landlord did not have any control over the daycare premises or any authority to regulate the tenant's pets.   

As such, Judge Harlacher Sibum concluded that the landlord’s conduct was not reckless or wanton as a matter of law.  Accordingly, the Preliminary Objections filed by the out-of-possession landlord Defendant were sustained and the claims against it dismissed.  

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

Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Feb. 5, 2019).

Wednesday, April 3, 2019

Federal Court Rules That Trial Judges Should Use Common Sense in Evaluating Motions To Dismiss in Bad Faith Cases

In the case of 1009 Clinton Properties, LLC v. State Farm Fire & Cas. Co., No. 18-5286, 2019 WL 1023889 (E.D. Pa. March 4, 2019 Kenney, J.), the court issued a lengthy Opinion addressing a Motion to Dismiss an insured’s bad faith claim in a property damage loss case.  

Among the allegations was that the carrier allegedly falsely represented to the Plaintiff that the loss was not entitled covered under the policy, that the carrier failed to complete a prompt and thorough investigation of the claim before asserting that the claim was not covered, and that the carrier unreasonably withheld policy benefits without a reasonable factual explanation.  

Of note is the court’s analysis indicating that, in reviewing Motions to Dismiss standards under the Federal Rules of Civil Procedure, that the trial court’s “must do away with a robotic reading of Twombly and Iqbal and instead use its common sense when addressing whether a bad faith claim can survive a Motion to Dismiss.  When the Court applies its common sense in analyzing a bad faith claim, here, it becomes apparent that Plaintiff’s bad faith claims survives Defendant’s Motion to Dismiss.”   

After reviewing the steps required in analyzing a Motion to Dismiss along with the basis elements of a bad faith claim, the court ruled that the Motion to Dismiss should be denied under the facts presented in this matter. 

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

I send thanks to Attorney  Lee Applebaum, the writer of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law blog and from the Philadelphia law firm of Fineman, Krekstein & Harris for bringing this case to my attention.  

Judge Leeson of Eastern Federal District Court Gives Lessons on Bad Faith Pleadings

In the case of Krantz v. Peerless Insurance Company, No. 18-CV-3450, 2019 WL 1123750 (E.D. Pa. March 11, 2019 Leeson, Jr., J.), the court granted a Motion to Dismiss a bad faith claim in a UIM case and then remanded the matter back to state court.

In this case, the UIM Plaintiff argued that the insurer improperly interpreted the policy in refusing to pay full policy limits.   The Complaint alleged that the carrier relied upon an invalid and unlawful set-off provision in withholding a substantial amount of the policy limits.  

However, the court found that the Plaintiff failed to plead facts to show that this set-off provision was invalid, “or, more importantly, that [the carrier] knew or should have known that it was denying the full amount of benefits based on an invalid provision.”  

The court also found additional allegations in the Complaint to be conclusory and lacking in other supporting factual allegations to make the averments plausible under the pleading requirements in federal court.   For example, the court faulted the following allegations:

(1)        The insurer did not make any good faith offers to settle despite repeated demands;
(2)        The insurer “failed to objectively and fairly evaluate his claim”;
(3)        The insurer “failed to promptly tender payment of the fair value of the claim”; and,
(4)        The insurer failed to reasonable investigate the claim.

The court concluded that the Plaintiff’s cursory allegations generally asserted that the carrier lacked the reasonable basis for denying the Plaintiff’s claim for benefits, “but do not provide any factual allegations from which the Court could make a plausible inference that Defendant knew or recklessly disregarded its lack of a reasonable basis for denying benefits.”  

After dismissing the bad faith count, the court found the Plaintiff’s claims no longer exceeded $75,000.00 and, as such, the court remanded the case to the Lancaster County Court of Common Pleas.  

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

I send thanks to Attorney Lee Applebaum of the Philadelphia law firm of Fineman, Krekstein & Harris.   This case was found on Attorney Applebaum excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law blog.  

Tuesday, April 2, 2019

Negligent Hiring/Supervision Claim Against Hospital Allowed To Proceed in Absence of Certificate of Merit

In the case of Joyner v. St. Luke’s Univ. Hosp., No. 2018-C-1033 (C.P. Leh. Co. Oct. 19, 2018 Johnson, J.), the court overruled a hospital’s Preliminary Objections asserting that the Plaintiff’s claims against the hospital for negligent hiring and supervision could not proceed in the absence of a Certificate of Merit.  As such, the Plaintiff was permitted to proceed on the claims presented.

The court ruled in this fashion after finding that the Plaintiff’s claim sounded in ordinary negligence and not professional negligence.  

In this matter, the Plaintiff alleged that she was sexually assaulted by an employee of the hospital while the Plaintiff was a patient at the hospital.   The Complaint asserted a claim against the hospital for negligent hiring, supervision, and training.  

After the Complaint was filed, the hospital filed a Notice of Intention to Enter a Judgment of Non Pros on a professional liability claim because Plaintiff did not file a Certificate of Merit.  

The Plaintiff responded with a Motion to Determine a Necessity of Filing a Certificate of Merit Pursuant to Pa.R.C.P. 1042.6.   The hospital then filed a Preliminary Objection as to the sufficiency of the Plaintiff’s claim against it.  

As stated, the court found that the Complaint asserted an ordinary negligence claim for which a Certificate of Merit was not required.   The court more specifically stated that the Plaintiff’s claim against the hospital did not raise questions of medical judgment, allege substandard medical treatment, or allege that the hospital’s actions fell below a professional or medical standard.   

The court additionally found that a jury could determine whether the hospital allegedly breached its duty to properly hire, supervise, and train its employee without any need for expert opinion.  

Accordingly, the court found that the Plaintiff could proceed in this claim without the necessity of filing a Certificate of Merit.

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

Source:  “Digest of Recent Opinions.”  Pennsylvania Law Weekly (Feb. 26, 2019).