First Party and UIM Bad Faith Claims Dismissed in Post-Koken Case; Leave to Amend Granted

 

In the case of Canfield v. Amica Mut. Ins. Co., No. 20-2794 (E.D. Pa. Oct. 2, 2020 Pappert, J.), the court ruled that a Plaintiff could not recover  damages under Pennsylvania's MVFRL or on her bad faith claim  where the allegations in her Complaint suggested nothing more than an ordinary dispute with her carrier over the value of her claims in this post-Koken auto accident matter.

More specifically, the court found that the facts alleged regarding the dispute between the Plaintiff and the carrier over the value of the claim and the payment of first party benefits did not amount to allegations of wanton conduct as required for the relief requested by the Plaintiff relative to her first party medical benefits claims asserted under Section 1797 of the MVFRL.

The court's decision with respect to Section 1797 is also notable in that the court followed prior precedent holding that, unless the carrier's actions fall outside the ambit of Section 1797 and involves bad faith abuses not related to the challenge of the denial of first party medical benefits, the MVFRL preempts the statutory bad faith claim concerning the Plaintiff's request for PIP benefits.

With regards to any separate bad faith claims asserted by the Plaintiff in the Complaint, the court pointed out that the Plaintiff did not aver an unreasonable denial of UIM or first party medical benefits by the carrier, but rather only alleged a delay in the payment of the same and an allegedly unreasonable position taken by the carrier on the value of the case.  

The court found that, while the Plaintiff disagreed with the value put on the file by the carrier, she had not asserted facts in the Complaint to support an allegation that the carrier's evaluation was unreasonable and/or that the carrier knew that it was unreasonable, all as is required to move forward on a bad faith claim.  

The court noted that, to proceed on a bad faith UIM claim in this regard, the Plaintiff must allege more than that the carrier extended "low-ball offers."  The court reaffirmed the rule of law that a carrier is permitted to make low but reasonable offers of settlement without fear of being found in bad faith. 

In the end, the court granted the Plaintiff leave to amend the Complaint to try to assert valid claims with regards to the above issues.

Anyone wishing to review this Opinion may click this LINK.  The court's companion Order can be viewed HERE.

Source: "Digest of Recent Opinions - Most Viewed Opinions."  Pennsylvania Law Weekly (Nov. 3, 2020).