Appellate Court Addresses Applicability if an Absolute Auto Exclusion in a Business General Liability Policy

In the case of Chris Eldredge Containers v. Crumb & Foster Specialty Ins., 2025 Pa. Super. 92 (Pa. Super. April 24, 2025 Lazarus, P.J., King, J., Lane, J.) (Op by. Lazarus, P.J.), the court addressed a coverage issue in this declaratory judgment action involving various coverage issues, including the applicability of an automobile exclusion in a business policy in a case involving an accident that involved a service truck driven by an employee of the carriers' insured.

The appellate court noted that it was proceeding under a de novo standard of appeal, meaning that it was not limited by the trial court's rationale and could affirm or reverse the trial court decision on any basis.   

The Pennsylvania Superior Court ruled that the absolute auto exclusion, which excluded coverage for bodily injury under the policy for any incident arising out of the use of an auto, was found to be ambiguous in the context of this policy and was, therefore, found to be not enforceable.

The Superior Court additionally ruled that the ownership clause in the absolute auto exclusion was found to be ambiguous when it failed to specify whose ownership, maintenance, use, or entrustment served to trigger that exclusion.

In the end, the appellate court reversed the trial court decisions and found that the carriers did owe a duty to defend and indemnify its insured under the facts presented.

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

Source: “Court Summaries” in the Pennsylvania Bar News By Timothy L. Clawges (June 9, 2025).

Source of image:  Photo by Vlad Deep from www.unsplash.com.

Court Upholds Assault and Battery Exclusion in Liability Policy Related To Shooting Incident

In the case of The Farmers Fire Ins. Co. v. S.W. Krauss, LLC, No. 2023-CV-5087 (C.P. Lacka. Co. May 12, 2025 Gibbons, J.), the court granted a liability carrier’s Motion for Judgment on the Pleadings based upon an assault battery exclusion contained in the subject policy relative to a shooting incident that occurred on the insured’s premises.

According to the Opinion, this matter involved an injured party who suffered a gunshot wound after gunfire was exchanged between unidentified individuals who were engaged in an dispute.

President Judge James A. Gibbons
Lackawanna County

The carrier for the landowner filed a declaratory judgment action and asserted that coverage was barred under the assault and battery exclusion contained in the policy. After reviewing the policy as compared to the facts alleged in the underlying civil litigation Complaint, the trial court here agreed and granted the carrier’s Motion for Judgment on the Pleadings.

The trial court also rejected the injured party’s efforts to create issues of fact based upon affirmative defenses raised in the injured party’s New Matter responses to the declaratory judgment Complaint. In this regard, the trial court noted that there were boilerplate allegations in the New Matter pleadings and no factual allegations in support of the same.

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

Federal Court Addresses Whether Nationwide's "One Product" Policy is a New Policy or a Renewal Policy

In the case of McGuire v. Nationwide Aff. Ins. Co. of America, No. 2:23-CV-01347-NR (W.D. Pa. March 6, 2025 Ranjam, J.), the court denied the carrier’s Motion for Reconsideration of the court’s previous decision relative to a UM/UIM coverage issue.

With this decision denying the carrier’s Motion for Reconsideration, the court maintained its previous position on whether Nationwide’s “One Product” policy was a new policy or a renewal of a prior policy.

In the court’s eyes, several of the “clarifications” in the One Product policy amounted to changes that reduced the amount of coverage from the prior policy. In light of this, the court ruled that the One Product policy could not be considered to be a “renewal” policy.

Rather, the court found that the purchase of a One Product policy amounted to the purchase of a new policy and that, therefore, under Pennsylvania law, Nationwide was required, as with any other purchase of UM or UIM coverage, to provide its insureds with a new stacking waiver form to execute under 75 Pa. C.S.A. §1738(c).

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

I send thanks to Attorney Scott Cooper of the Harrisburg law firm Schmidt Kramer for bringing this decision to my attention.

Superior Court Addresses When Auto Insurance Carrier Must Present Insured With New UIM Coverage Selection Forms

In the case of Goodville Mut. Cas. Co. v. McNear, No. 861 MDA 2023 (Pa. Super. Feb. 26, 2025 Nichols, J., King, J., and Sullivan, J.), the court affirmed a trial court decision that an insurance company was not obligated to obtain new UIM coverage selection forms whenever an insured added vehicles to their policy.

According to the Opinion, back in 2012, the insured initially signed an election form for less than full UIM coverage. More specifically, the insured selected benefits of $50,000.00 per person, $100,000.00 per accident stacked across three (3) vehicles covered by the policy.

The insured then renewed their policy ever six (6) months and, between 2012 and 2018, the added and removed vehicles, with policy covering as many as four (4) and as few as two (2) vehicles.

The carrier did not obtain new limited UIM election forms whenever the insureds added vehicles to the policy. The court also noted that the insureds never affirmatively requested any changes to their benefits.

By the year 2018, the insured’s policy again covered three (3) vehicles. In 2018, one of the insureds was involved in an accident.

The insureds covered the policy limits from the tortfeasor’s vehicle. The insured then filed a UIM claim. The carrier paid the UIM benefits of $50,000.00 stacked on the three (3) vehicles covered on the policy.

The insured disputed the amount paid and asserted that the addition of vehicles to their policy constituted “new purchases” coverage which required the carrier to obtain new UIM elections each time. The Plaintiffs attempted to assert that, because the carrier failed to obtain new UIM election forms, the carrier should be forced to pay full UIM benefits up to the bodily injury limits of their policy, i.e., $250,000.00 stacked across three (3) vehicles, or $750,000.00.

The carrier rejected that claim and commenced this declaratory judgment action. 

As noted, the Superior Court affirmed the trial court’s decision rejecting the Plaintiff’s arguments. The Pennsylvania Superior Court noted that 75 Pa. C.S.A. §1734 requires only that the carrier “issue” UIM coverage in the amount selected by a named insured in writing signed by a named insured.

The court also noted that 75 Pa. C.S.A. §1791 permits the carrier to rely upon the elections and notices regarding the availability of UIM benefits at the time of the application for original coverage.

Here, because it was undisputed that the insured had completed a “sign-down” form selecting limited UIM coverage, and given that neither named insured on the policy affirmatively reflected any change, in writing, to the UIM coverage, and given that the insureds did not object to any alleged defects in the §1791 notices they received at the time the insured applied for the coverage, the appellate court ruled that the original “sign-down” form remained effective at the time the Plaintiff was involved in the subject accident.

The court additionally noted that, pursuant to §1791, the insurance company was under no obligation to provide additional notices regarding the limited UIM benefits the insured had originally selected. In the end, the court ruled that, once the insured elected limited UIM benefits when applying for the original policy, the insurance company was entitled to presume that the insured selection remained effective until affirmatively changed by a named insured.

Accordingly, the Superior Court affirmed the entry of a declaratory judgment in favor of the carrier.

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


Source: The Legal Intelligencer State Appellate Case Alert, www.Law.com (March 18, 2025).

Superior Court Affirms Trial Court's Finding that No Coverage Existed Related to a COVID-19 Shutdown of a Business

In a non-precedential decision issued by the Pennsylvania Superior Court in the case of The Scranton Club v. Tuscarora Wayne Mut. Group, No. 238 MDA 2021 (Pa. Super. Jan. 27, 2025 Panella, P.J., Olson, J., and Kunselman, J.) (Op. by Kunselman, J.), the Superior Court affirmed the trial court’s dismissal of all claims filed by The Scranton Club and found that no coverage existed to the COVID shut down of the Plaintiff’s business.  

The affirmed trial court Opinion was written by Judge Terrence R. Nealon of the Lackwanna County Court of Common Pleas.  The Tort Talk Blog post on Judge Nealon's Opinion, which contains a link to that decision can be found at this LINK.

In this case, the Superior Court followed the precedent set forth in the recent Pennsylvania Supreme Court decision on similar issues in the case of Ungarean v. CNA & Valley Forge Ins. Co., 323 A.3d 593 (Pa. 2024).

The Superior Court in this case found that the trial court properly ruled that The Scranton Club did not allege any facts to establish that it incurred a “direct physical loss of or damage to property” as required to establish coverage under the policy. The court noted that, given that there was nothing that required restoration of The Scranton Club’s property as a result of the COVID shut down, there is no coverage to be provided under the insurance policy at issue.

The Superior Court noted that it also continued to affirm the trial court’s decision to dismiss the Plaintiff’s claims for civil authority coverage. The court noted that, to assert a claim for the civil authority coverage under the policy at issue, the civil authority action prohibiting access to the premises must have been in response to “damage” caused to another property. Given that there is no evidence of any damage to any neighboring properties which resulted in the Plaintiff’s property being shut down, the Superior Court held that the trial court was correct to deny coverage on this ground as well.

Lastly, the Superior Court noted that it was now affirming the trial court’s dismissal of the claim for bad faith given that coverage was not otherwise available under the policy at issue.


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

Summary Judgment Entered for UIM Carrier Where Plaintiff Did Not Fall Under Definition of a "Covered" Person

In the non-precedential decision in the case of Miller v. USAA General Ind. Co., No. 23-1934 (3d Cir. Jan. 2025 Chagares, C.J., Chung, J., and Fisher, J.) (Op. by Fisher, J.), the court affirmed summary judgment that had been granted by Judge Christopher C. Conner of the Federal Middle District Court in favor of the carrier in a UIM case.

According to the Opinion, a UIM Plaintiff sought coverage under a policy that was issued to the grandmother of the Claimant’s daughter. Both the Claimant and the daughter were living with the grandmother at the time of the accident.

The grandmother was the only named insured on the policy. The Claimant and the grandmother were not related by blood, marriage, or adoption.

The Claimant argued that her daughter was a named insured because she was listed as an “operator” on the declarations page for the applicable policy and that, therefore, the Claimant also qualified as an insured under that policy.

The Claimant additionally argued that the limitation of UIM coverage to the named insured and family members of the named insured, as defined by the policy, violated the Pennsylvania Motor Vehicle Financial Responsibility Law and the related stacking provisions. In this case, the Claimant invoked the case of Gallagher v. Geico and its precedent.

The Third Circuit Court of Appeals dismissed the Claimant’s arguments. The Third Circuit confirmed that the Claimant did not qualify as an insured under the policy and that, therefore, no UIM benefits were owed to the Claimant.

The Court noted that the issue in this case was not whether the named insured had waived UIM benefits.  Rather, the issue, and the finding, was that the Plaintiff was simply not a "covered" person under the terms of the policy.   

Moreover, the court found that, since the Claimant was not even an insured under the policy, no duty of good faith was owed to her by the carrier.

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


I send thanks to Attorney Christopher W. Woodward of the Camphill office of Marshall Dennehey for bringing this case to my attention.

Federal Court Finds that Lyft Driver Able to Pursue Claim That Driver Was Owed Uninsured Motorist Coverage From Lyft

In the case of Ahtasham v. Lyft, Inc., No. 2:24-CV-01673-GJP (E.D. Pa. Pappert, J.), the Eastern District Federal Court ruled in favor with a Lyft driver in that driver’s contractual dispute with Lyft over the availability of $1million dollars in uninsured motorist coverage.

According to the Opinion, Lyft filed a Motion to Dismiss a lawsuit brought by a Lyft driver who claimed that he was entitled to uninsured motorist coverage following a motor vehicle accident.

The court determined that the terms of service agreement and a promise in a driver guidebook was a binding contract between Lyft and one of its drivers who was the Plaintiff at issue in this case.

According to the Opinion, the guidebook promised Lyft drivers that “‘we’ve got you with our $1million insurance policy,’” and that “‘there are four coverages included in our insurance policy.’” including underinsured/uninsured (UM/UIM motorist coverage).

In the Opinion, it was indicated that the Plaintiff claimed he was denied coverage by the UM carrier after he was in an accident with an uninsured driver. Coverage was denied even though Lyft previously allegedly informed the Plaintiff that he and his car would be insured.

According to the Opinion, prior to the accident, Lyft had waived the UM/UIM coverage for its Pennsylvania drivers, without informing them.

The Plaintiff filed suit against Lyst seeking entitlement to uninsured motorist benefits, as well as claims of breach of contract, fraudulent misrepresentation, violations of Pennsylvania’s Unfair Trade Practices and Consumer Protection Law, and negligent misrepresentation.

In his Complaint, the Plaintiff additionally sought a declaratory judgment that Lyft had a duty to provide him with up to $1 million dollars in uninsured motorist coverage.

The breach of contract claim revolved around the parties’ alleged agreement and the driver guidebook, which Lyft argued was not part of its contract with the Plaintiff.

The court concluded that the agreement’s interpretation, including whether it incorporated references to the guidebook’s UM/UIM coverage promise, was governed by California law as that was where Lyft maintained its principal place of business.

The Plaintiff claimed that the driver’s agreement and the guidebook, when considered together, constituted his contract with Lyft that he relied upon. The Plaintiff more specifically asserted that he relied upon the provision and the guidebook that “in the event of an accident…our UM/UIM coverage will apply up to $1million per accident.”

Lyft attempted to argue that this representation was barred as a matter of law by the parol evidence rule. 

The court found that the parol evidence rule did not serve to exclude evidence that is offered to explain any ambiguity or to otherwise assist in the interpretation of the terms of an alleged agreement. 

The court noted that, where it is decided by the court that the language of a contract is ambiguous or fairly susceptible of more than one interpretation, extrinsic evidence relevant to prove any of the possible meanings is admissible to assist in the determination of the term of the contract. 

The court noted that, in this matter, the agreement contained two provisions that indicated that the guidebooks promised to provide Lyft drivers with uninsured and underinsured motorist coverage was part of the contractual relationship between the drivers and the company.

Overall, the court found that the Plaintiff’s allegations that Lyft breached the guidebook’s clear promise of UM/UIM coverage was sufficient to plausibly state a claim for breach of contract.

The court also rejected arguments by Lyft that a disclaimer in the guidebook prevented the guidebook from being interpreted as it was being interpreted by the court.

In the end, the federal court judge from the Eastern District denied Lyft’s Motion to Dismiss the lawsuit brought by this Lyft driver who claims that he is entitled to uninsured motorist coverage under a Lyft Insurance policy.

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


I send thanks to Attorney Jimmy Kunnell of the Feasterville-Trevose, PA law firm of Kunnell Law for bringing this case to my attention.


See also: Article “Federal Judge Sized With Lyft Driver In Contractual Dispute Over $1M Uninsured Motorist Coverage” By Riley Brennan of The Legal Intelligencer (Sept. 13, 2024).

Federal Court Remands Coverage Action to State Court

In the case of Turner v. Progressive Specialty Ins. Co., No. 2:24-CV-00939-JFM (E.D. Pa. Aug. 14, 2024 Murphy, J.), the court granted a motion to remand a class action regarding UM/UIM coverage issues after finding that grounds for federal court jurisdiction were not met by the carrier.

The court noted that this case was removed by Progressive from the Court of Common Pleas of Philadelphia County to the federal district court. The court noted that the purported basis for jurisdiction in this case was the Class Action Fairness Act which requires, among other things, that the aggregate amount in controversy be at least $5 million dollars.

In an Amended Complaint, the Plaintiff dropped any claim for punitive damages and and confirmed that all that was sought was a judicial declaration of uninsured and underinsured motorist coverage for him and other proposed class members.

The court found that Progressive had not met its burden to establish the amount in controversy for federal court jurisdiction. As such, the case was remanded to the state court.

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


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

Pennsylvania Superior Court Reverses Verdict In Favor of Plaintiff in Bad Faith Case

In the case of Watchward Worldwide v. Erie Insurance Exchange, No. 1221 WDA 2022 (Pa. Super. Jan. 9, 2021 Bowes, J. Kunselman, J., and Collins, J.) (Op. by Colins, J.), the Pennsylvania Superior Court vacated a lower court judgment in favor of the Plaintiff in an insurance breach of contract and bad faith claim after finding that the carrier was entitled to judgment in its favor as a matter of law on all claims presented.

In this case, the insured filed an insurance claim for loss of electronic data as a result of a computer hacking incident. At the time, the insured was covered by the carrier under a property damage and liability insurance policy that included coverage for the reproduction or replacement of electronic data.

When the insured filed a claim with the carrier for a loss caused by the deletion of its electronic data, the carrier denied the coverage claim on the grounds that the policy did not cover the loss because the electronic data that was destroyed was not on the insured’s computers and on the grounds the cost of replacing the data lost was less than the insured’s $2,500.00 deductible.

At trial, the carrier moved for a nonsuit at the end of the Plaintiff’s case based upon the defenses noted above. The jury entered a verdict in favor of the insured. The carrier then filed post-trial motions which were denied.

A non-jury trial on the Plaintiff’s bad faith claim was then scheduled. Prior to the date of that trial, the parties agreed to proceed by way of argument based upon trial evidence and written submissions along with some additional testimony. The trial court then issued its non-jury verdict on the bad faith claim finding that the carrier had acted in bad faith based upon its denial of coverage. The trial court awarded the Plaintiff $20,000.00 in punitive damages and $50,000.00 in attorneys' fees and costs.

The trial court then denied post-trial motions filed by both parties with respect to the bad faith verdict. The case was then appealed up to the Superior Court.

The Pennsylvania Superior Court ruled that the carrier’s interpretation of its own policy was correct in terms of a finding that no coverage was due to the insured under the case presented. More specifically, the Superior Court noted that the Plaintiff’s evidence did not prove that the Plaintiff’s loss exceeded the policy’s $2,500.00 deductible. As such, the Superior Court found that Erie did not breach its contract when it denied the request for insurance benefits under the policy.

Given that the Superior Court found that the contract had not been breached, the Superior Court also found that the carrier was entitled to judgment in its favor on the bad faith claims. The court otherwise also noted that, although a different aspect of the carrier’s denial of the claim presented may have been erroneous, the carrier’s decision in this regard was reasonable under the circumstances presented.

Accordingly, the bad faith claim failed because the Plaintiff was not able to show, by clear and convincing evidence, that the carrier had no reasonable basis for denying the claims presented.

In the end, the Superior Court ruled that the carrier was entitled to judgment in its favor on all claims presented. As such, the lower court judgments entered in favor of the Plaintiff were vacated and the case was remanded with instructions for the trial court to enter judgment notwithstanding the verdict in favor of the carrier.

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

Jurisdiction and Venue Issues Addressed in Insurance Coverage Action

In the case of Franko v. USAA, No. 2023-CV-1996 (C.P. Lacka. Co. May 31, 2024 Nealon, J.), the court addressed a coverage action relative to the theft of an allegedly covered vehicle. After the carrier denied coverage, the insured filed a lawsuit for breach of contract and bad faith liability.

The carrier filed Preliminary Objections asserting a lack of subject matter jurisdiction due to the policy’s form selection clause that limited legal actions to a court and county and state where the covered person resided at the time of the of the accident. The carrier also filed a Preliminary Objection asserting lack of personal jurisdiction based upon the allegations of the Complaint. Also asserted were improper venue objections along with a legal insufficiency of the bad faith claim.

Judge Nealon ruled that the policy’s form selection clause was inapplicable under the language of the policy given that the Plaintiff’s “comprehensive loss” claim arose from the deliberate “theft” of his vehicle, rather than an unintentional “accident.”

The court additionally ruled that, by obtaining a certificate of authority to conduct insurance business in Pennsylvania, the carrier had voluntarily consented to general personal jurisdiction in Pennsylvania.

The court additionally found that the allegations of the Complaint, and the exhibits attached thereto, stated a cognizable bad faith claim against the carrier.

With regards to the venue issue, the court directed the parties to conduct venue discovery and to resubmit the challenge to the court for a decision thereafter.

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

Carrier Permitted to Deny Coverage Due to Non-Permissive Use

In the case of State Farm Mutual Automobile Insurance Company v. Hamilton, No. AD 2020-10 (C.P. Crawf. Co. Feb. 12, 2024 Stevens, J.), the court ruled that State Farm was not required, based upon the facts presented, to provide coverage to a Defendant under the relevant insurance policy for an incident that occurred given that the party at issue was not authorized to be driving the insured’s vehicle on the date of the incident and, therefore, did not qualify as an insured under the liability coverage at issue. 

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

I send thanks to Attorney Joseph Hudock of the Summers McDonnell law firm in Pittsburgh for bringing this case to my attention.

Pennsylvania Supreme Court Upholds Validity of Regular Use Exclusion

On January 29, 2024, the Pennsylvania Supreme Court issued its long-awaited, much anticipated decision in the Regular Use Exclusion case of Rush v. Erie Insurance Exchange, No. 77 MAP 2022 (Pa. Jan. 29, 2024)(Maj. Op. by Donohue, J.)(Concurring Op. by Wecht, J.).

The Pennsylvania Supreme Court has ruled that, as presented in this case, the Regular Use Exclusion contained in motor vehicle insurance policies does not violate the express language of Pennsylvania's Motor Vehicle Financial Responsibility Law [MVFRL].

The Plaintiff in Rush was a police officer who was injured in a motor vehicle accident while driving his police vehicle.  

The Plaintiff recovered the liability limits from the tortfeasor's policy and the UIM limits on the police vehicle.

The Plaintiff then sought to obtain additional recoveries from the Erie Insurance policies that covered his personal vehicles at home.  Erie Insurance relied upon a Regular Use Exclusion contained in the policy to deny coverage on the UIM claim.

The trial court and the Superior Court had ruled, in part, that the Regular Use Exclusion violated the provisions of the MVFRL, and in particular, the terms of 75 Pa.C.S.A. Section 1731.  

More specifically, the lower courts had held that the Regular Use Exclusion conflicted with the language of Section 1731's mandate of the provision of UIM coverage to insureds by limiting the scope of the coverage provided by Section 1731 by precluding coverage if an insured is injured while using a motor vehicle that the insured regularly uses but does not own.

As noted, in its decision, the Pennsylvania Supreme Court reversed the lower courts' decisions and upheld the validity and enforceability of the Regular Use Exclusion.

In so ruling, the Pennsylvania Supreme Court pointed to prior decisions it had rendered repeatedly upholding the validity of the Regular Use Exclusion.  The Court found the Plaintiff's arguments in this case to be a mere recitation of at least one of the same arguments that had been previously rejected by the Court relative to the validity of the Regular Use Exclusion.

The Supreme Court rejected the Plaintiff's argument that UIM coverage must be provided in all circumstances regardless of which vehicle the injured party was located in at the time of the accident.  The Court noted that, to accept such an argument would render all exclusions invalid.  The Supreme Court rejected this argument.

The Supreme Court also rejected the Plaintiff's reliance upon the Pennsylvania Supreme Court's decision in  Gallagher v. GEICO for the proposition that the Regular Use Exclusion should be eradicated across the board just as the Household Exclusion had been eradicated in Gallagher as a allowing for a de facto waiver of stacked coverage when the MVFRL required the carrier to secure a written waiver of coverage from its insureds.

In this Rush v. Erie Insurance Exchange case, the Pennsylvania Supreme Court confirmed that it had clarified and narrowly limited its Gallagher decision in its more recent decision in the case of Erie Insurance Exchange v. Mione.  See Op. at p. 31-32.  In Mione, the Court had confirmed that the Household Exclusion remained valid and applicable except possibly in cases where the insured was attempting to stack coverage under 75 Pa.C.S.A. Section 1738.

Here, in Rush v. Erie Insurance Exchange, the Supreme Court ruled that "[i]f the MVFRL does not require that UIM coverage follow the insured in all circumstances, then the MVFRL cannot be read to prohibit exclusions from UIM coverage."  See Op. at p. 36.  

As such, the Court ruled that the terms of the UIM insurance contract between the parties still controlled relative to the scope of the UIM coverage available, or not available, and that, therefore, the Regular Use Exclusion remained enforceable.  Id.

The Supreme Court in Rush also specifically held that the Regular Use Exclusion remained a permissible limitation of UIM coverage within the language of the MVFRL and that, "[w]ith decades of reliance by insureds and insurers, and no justification to allow this Court to depart from decades of established law," the Court would maintain its continued course on this issue "unless and until the General Assembly or the Insurance Department acts in a way that would suggest we do otherwise."  Id. at p. 36-37.

Ultimately, the Supreme Court overruled the lower court decisions and held that the Regular Use Exclusion remained valid and enforceable.

Anyone wishing to review the Majority's Opinion may click this LINK.  Justice Wecht's Concurring Opinion can be viewed HERE.

Source of image:  Photo by d koi on www.unsplash.com.

Court Grants Plaintiff What He Paid For In UIM Coverage Question Case

In the case of Erie Insurance Exchange v. Eachus, 2023 Pa. Super. 264 (Pa. Super. Dec. 12, 2023 Panella, P. J., Dubow, J., Sullivan, J.)(Sullivan, J.), the court affirmed the entry of summary judgment in favor of the insurance company in a case involving a dispute over the insured’s entitlement to certain uninsured and underinsured motorist benefits.

More specifically, the insured was asserting an entitlement to higher uninsured and underinsured motorist benefits under the policy even though the insured requested lower limits in signed documentation provided to the carrier.

The court affirmed the entry of summary judgment from the lower court and found that the insured had specifically requested and executed forms providing for lower uninsured and underinsured benefits. The court also noted that the Plaintiff paid a lower premium for the lower benefits as further evidence of the insured’s acceptance of the coverage provided.

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


Source “Court Summaries” by Timothy L. Clawges in the Pennsylvania Bar News (Jan. 15, 2024).

Homeowner's Insurance Bad Faith Claim Dismissed

In the case of Qin v. Travelers Personal Ins. Co., No. 2:22-CV-03264-KNS (E.D. Pa. Dec. 15, 2023 Scott, J.), the court granted a Defendant carrier’s Motion to Dismiss a Plaintiff’s bad faith claim based upon the homeowner insurance carrier Defendant’s refusal to cover a loss because the property in question had been vacant for more than sixty (60) days prior to the date of the loss.

The court found that the Complaint lacked factual allegations to support the bad faith claim.

This case involved issues arising under a homeowner’s insurance policy.  The Plaintiff alleged that tenants had damaged a property that he owned.

The court found that the Plaintiff did not allege any facts to support a claim of bad faith and only made conclusory allegations. The court otherwise held that the allegations in the Complaint failed to satisfy the two prongs necessary to establish a bad faith claim, that being that the Defendant allegedly lacked a reasonable basis for denying benefits under the policy and that the carrier knew or recklessly disregarded its lack of a reasonable basis in denying the claim.

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


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Jan. 5, 2024).

Source of image:  Photo by Tierra Mallorca on www.unsplash.com.

Federal Court Applies Abstention Doctrine To Declaratory Judgment Action

In the case of Assoc. Ind. Ins. Co., Inc. v. 101 West Lehigh, LLC, No. 2:23-CV-03736-CFK (E.D. Pa. Oct. 31, 2023 Kenney, J.), the Motion of a necessary party/Defendant to dismiss a declaratory judgment action was denied.

The underlying matter involved a fatal shooting incident at a gas station. The Plaintiff insurance company filed a declaratory judgment action on the issue of the duty to defend or indemnify certain Defendants involved in the underlying case.

The Plaintiff insurance company included the estate of the deceased individual as a necessary party Defendant.

That necessary party Defendant filed a Motion to Dismiss pursuant to the abstention doctrine. The necessary party Defendant argued that the coverage action should be dismissed in light of the federal court’s limited discretionary authority to review insurance coverage issues where there was a pending state court proceeding that did not implicate federal interest.

This motion was denied. The federal court initially noted that it had subject matter jurisdiction based upon the diversity and the amount in controversy.

Because the federal action involve a request for declaratory relief only and involved a question of insurance coverage, the court addressed the issue of its abstention authority under the analysis set forth in Reifer v. Westport Ins. Corp., 751 F.3d 129 (3d. Cir. 2014) and State Auto Ins. Co. v. Summy, 234 F.3d 131 (3d. Cir. 2000).

Applying the factors required by those decisions, the federal court in this case initially confirmed that there was no parallel state proceeding because the state court action as focused on the issue of liability while this federal court action involved coverage questions. The federal court noted that the absence of a parallel state court proceeding favored the federal court’s exercise of its jurisdiction.

The court in this case additionally found that the application of the remaining factors weighed in favor of the federal court retaining jurisdiction over the declaratory judgment action. As such, the Motion to Dismiss was denied.

Anyone wishing to review a copy of this decision may click this LINK.  The Court's companion Order can be found at this LINK.


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Nov. 24, 2023).

Federal Court Punts On Declaratory Judgment Action Involving Insurance Coverage Questions

Ray Guy
Legendary Raiders Punter

In the case of Mesa Underwriters Spec. Ins. Co. v. Alisha Real Estate, LLC, No. 2:23-CV-01281-GJP (E.D. Pa. Sept. 7, 2023 Pappert, J.), the court granted a Defendant commercial property owner’s Motion to Dismiss or Stay the Carrier’s Federal Declaratory Judgment Action.

In this declaratory judgment action, the carrier was asserting that it had no duty to defend or indemnify a Defendant in the underlying state court personal injury action.

This federal court exercised its discretion under the Declaratory Judgment Act to decline jurisdiction where the relevant parties were all parties to the state court action and to litigate the coverage issues in the state Court of Common Pleas.

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


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Oct. 6, 2023).

Trial Court Denies Motion to Stay Underlying Proceedings Related to Companion Coverage Case

In the case of Pettinato Realty Co., Inc. v. Travelers Prop. Cas. Co. of Am., No. 22-CV-932 (C.P. Lacka. Co. March 16, 2023 Nealon, J.), the court denied a carrier’s Motion to Stay the civil proceedings in an underlying breach of contract and negligence claim arising out of an insurance coverage dispute.

While the Defendant carrier argued that the underlying matter was not yet “ripe” for litigation given that no coverage determination had been made to date, the trial court determined that it was in the court’s best interests to allow the litigants to proceed with discovery and pre-trial proceedings so that the case would not later be delayed once coverage determination was completed.

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


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (April 11, 2023).

Does The Issuance of a New Policy Number on an Automobile Insurance Policy Constitute the Creation of a New Policy?

In the case of Shea v. Nationwide Ins. Co. and Davis, No. 3:22-CV0-00494-MEM (M.D. Pa. April 6, 2023 Mannion, J.), Judge Malachy E. Mannion of the United States District Court for the Middle District of Pennsylvania adopted the Report and Recommendation of Chief Federal Magistrate Judge Karoline Mehalchick and ordered that this declaratory judgment action be remanded to state court for review by the state court.

The legal issue presented in this matter addressed “the novel question or whether or not the issuance of a new policy number constitutes the establishment of a new policy requiring new sign down forms.”

The court determined that this issue presented a novel and unsettled issue of state law. As such, under the factors set forth in the case of Reifer v. Westport Ins. Corp., 751 F.3d 129 (3d. Cir. 2014), the court decided to remand the case to the state court for a decision.  The case was remanded to the Luzerne County Court of Common Pleas.

Anyone wishing to review a copy of the Report and Recommendation of Judge Mehalchick and well as the decision of Judgment Mannion approving the Report and Recommendation may click this LINK.

Plaintiff's counsel in this case was Attorney Neil T. O’Donnell and Attorney Gerard Gaughan of the Kingston, PA law firm of O’Donnell Law Offices.

 

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Trial Court Rejects Carrier's Request To Intervene To Put Coverage Question On Verdict Slip

In the case of Hannibal v. Solid Waste Serv., Inc., Feb. Term, No. 01172 (C.P. Phila. Co. Dec. 29, 2022 Shreves-Johns, J.), the court found that the Defendant’s liability insurance company could not intervene in this premises liability action for the limited purpose for submitting Interrogatories in aid of determining whether the Plaintiff’s accident was excluded under the insurance company’s insurance policy.

This case arose out of an incident during which the Plaintiff was working at a state prison when he was injured in an accident in a work-related event.

The trial court denied the Defendant’s insurance company’s Petition to Intervene after finding that the insurance company’s liability was uncertain and that the insurance company did not have a legally enforceable interest in the case at hand.

The court issued its ruling after reviewing the categories of permissible intervenors as defined under Pa. R.C.P. 2327.

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


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Feb. 28, 2023).

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With Regards to An Insurance Policy's Definition of 'Residency,' Court Rules That An Insured May Have More Than One Residence

In the case of Isenberg v. State Farm Fire & Cas. Co., No. 21-CV-1147 (W.D. Pa. May 27, 2022 Schwab, J.) (Mem. Op.), the court addressed issues of insurance coverage in the context of a house fire.

In this case, the carrier asserted that it was entitled to summary judgment because the Plaintiff was not using the house as a residence at the time of the fire.

According to the facts of the case, the Plaintiff had purchased the house in 2018, and continued to live in her apartment during the renovations at the house, which renovations turned out to the more extensive than anticipated. Then, in 2020, a fire destroyed the home. The Plaintiff filed a claim under her homeowner’s policy.

The carrier rescinded the policy, alleging that the Plaintiff was not using the house as a residence.

The Plaintiff filed suit in state court and the carrier removed the case to federal court. After discovery was completed, the Defendant carrier moved for summary judgment.

As noted, the carrier asserted that was not using the property as a residence at the time of the fire. The insurance company additionally argued that a person could only have one “residence.”

The court ruled in favor of the Plaintiff.  In part, the court found that Pennsylvania courts and federal courts applying Pennsylvania law had agreed that a person was not limited to only being able to have one residence.

Rather, the case law suggested that residency was a question of physical fact and not the policyholder’s intention.

In this case, the record before the court revealed that the Plaintiff was physically present at house on an almost daily basis. There was also evidence that she had meals there, slept at the house on occasion, and had personal belongings in the house during the course of the renovations.

As such, the carrier’s Motion for Summary Judgment was denied.

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


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (June 14, 2022).

Source of image:  Photo by Jeffrey Czum on www.pexels.com