Court Dismisses Case Based Upon Limitation of Actions Provisions in Insurance Policies

In the case of Sciacca Service Center v. Certain Underwriters at Lloyd’s London, No. 2023-CV-20559 (C.P.. Mont. Co. May 15, 2025 Saltz, J.), the court issued a Rule 1925 Opinion requesting the Superior Court affirm the trial court’s decision in granting judgment on the pleadings in favor of the Defendant insurance companies under a limitation of actions provision that was contained in the policy. 

This matter arose out of claims by an insured for recovery under two (2) separate insurance policies for storm damage to the insured’s property.

Based upon the record before it, the court determined that the Plaintiff’s lawsuit was barred by the suit limitation provision  contained in each of the policies at issue. 

As such, the trial court granted judgment on the pleadings in favor of the Defendant insurance companies and, in this Opinion, requested the Superior Court to affirm that trial court decision.

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


Source: The Legal Intelligencer Common Pleas Case Alert, www.Law.com (June 11, 2025).

Limitation of Actions Provision in Property Insurance Policy Upheld and Applied to Dismiss Claim

In the case of Gonzales v. Nazareth Mut. Ins. Co., No. 412-CV-2019 (C.P. Monroe Co. July 13, 2020 Williamson, J.), the court upheld a limitation of action provision contained in a property insurance policy.

According to the Opinion, the Plaintiff owned a rental property that was insured by the carrier. After the Plaintiff discovered damage on the property, a claim was submitted to the insurance carrier for a recovery. The carrier denied the claim because the damage had been caused by a former tenant, which loss was not covered under the policy. 

Over two (2) years later, the Plaintiff filed an initial action against the carrier alleging bad faith. A year after that, the Plaintiff sought to amend the Complaint to add a breach of contract action.

The Defendant carrier filed a Motion for Judgment on the Pleadings in which it argued that the bad faith claim was untimely because the policy contained a two (2) year statute of limitations provision. 

The court agreed and granted the Motion for Judgment on the Pleadings. The court noted that the addition of a breach of contract claim would not necessarily create an additional cause of action because the bad faith claim was based upon the same facts and theory as the breach of contract claim. The court upheld and found the two (2) limitation period contained in the insurance policy to be valid. 

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

Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Aug. 18, 2020).

Limitation of Actions Provision in Homeowner's Policy Upheld

In the case of Palek v. State Farm Fire and Cas. Ins. Co., No. 2:20-CV-170-JFC (W.D. Pa. Aug. 26, 2020 Conti, J.), the court granted the carrier’s Motion to Dismiss for failure to state a claim with regards to a breach of contract claim and a bad faith claim relative to the handling of a homeowner's insurance claim. 

The granting of the dismissal relative to the breach of contract claim was with prejudice but the granting of the dismissal with respect to the bad faith claim was without prejudice. The Plaintiff was granted twenty (20) days to file an Amended Complaint. 

As noted, this matter arose out of claims under a homeowner’s policy. According to the Opinion, the State Farm policy provided coverage for accidental and direct physical loss to, among other things, the in-ground swimming pool on the Plaintiff’s property. 

According to the Opinion, the Plaintiffs had emptied their swimming pool of water in order to perform routine maintenance. In doing so, they noticed damage to the swimming pool’s liner. They presented a claim for State Farm who eventually determined that the damage was not covered under the policy. The carrier asserted that the damage was caused by earth movement and, therefore, was excluded under the policy. 

The Plaintiffs filed a claim for breach of contract of the policy and a bad faith denial of benefits without a reasonable basis to do so. 

With regard to the breach of contract claim, the court agreed with State Farm that the Plaintiff’s claims were barred by the 1-year suit limitation provision contained in the policy. The court upheld this provision and found no evidence to support a finding of waiver or estoppel as raised by the Plaintiff.

The court additionally found that, even if the suit limitation provision did not apply, the alleged damages would be excluded under an application of the policy language. 

Relative to the bad faith claim, the court confirmed that a claim for bad faith is an independent cause of action separate from a contract claim. The court noted that the Plaintiff could proceed on the bad faith claim even where a contractual limitation period has been enforced and a breach of contract claim has been dismissed. Given that the Plaintiff had claims with respect to how the claim was handled, the court allowed the Plaintiff to provide more details in support of an alleged bad faith claim. 

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

I send thanks to Attorney Mark A. Martini of the Pittsburgh office of the law firm of Robb Leonard Mulvihill, LLP for brining this case to my attention.

Insurance Policy's Limitation of Action Provision Upheld

In the case of Mazzoni v. Travelers Home & Mut. Ins. Co., No. 3:19-cv-2169 (M.D. Pa. Feb. 13, 2020 Mannion, J.), the court dismissed a contract and bad faith case under a statute of limitations argument.

According to the Opinion, the carrier denied coverage on November 3, 2015.

The Plaintiff did not sue for breach of contact or bad faith until September 20, 2019.

The carrier moved to dismiss the breach of contract claim based upon a two (2) year statute of limitations contained in the policy itself. The carrier also moved to dismiss the bad faith claim under the two (2) year statute of limitations under Pennsylvania law.

The court upheld a two (2) year suit limitation contained in the policy as there was no merit to the Plaintiff’s claim that Pennsylvania’s four (4) year statue of limitations with contract claims under 42 Pa. C.S.A. §5501 should control in the case. This was particularly so where the Plaintiff did not allege that the carrier led the Plaintiff to believe that the two (2) year limitations period contained in the policy would not be enforced, or that the carrier took any steps that induced the Plaintiff to file her Complaint after that two (2) year deadline.

The contract claim was therefore dismissed with prejudice.

With regard to the bad faith claim, the court would not let the Plaintiff escape the statute of limitations issue by virtue of the Plaintiff leaving out of the Complaint the date upon which the carrier had denied coverage, or by not attaching the denial letter to the Complaint.

The court stated that it could rely upon and review the November 3, 2015 denial of coverage letter since the Defendant attached that letter to its Motion to Dismiss.

Judge Mannion found that there was “no doubt” that the two (2) year statute of limitation on the bad faith claim began to run when the insured first learned that the carrier was denying coverage. As such, the statutory bad faith claim was found to be barred in this matter as well.

The court also rejected the Plaintiff’s efforts to assert a common law bad faith claim that would allegedly be subject to a four (4) year contract statute of limitations. The court noted that, separate and apart from the fact that the Complaint alleged a statutory bad faith claim, under Pennsylvania law, a common law bad faith claim is solely a contract based claim in Pennsylvania and is deemed to merge with the breach of contract claim. Accordingly, the court found that the alleged common law bad faith claim would be subject to the same two (2) year contractual limitation period at issue in this case.

The court additionally noted that, in any event, common law bad faith claims did not apply to first party property damage claims as were at issue in this case.

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

I send thanks to Attorney Lee Applebaum of the Philadelphia law office of Fineman, Krekstein & Harris for bringing this case to my attention. Please be sure to check out Attorney Applebaum’s excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog for continuing updates on important bad faith cases in Pennsylvania and New Jersey.

Limitation of Actions Provision in Contract Upheld in Products Liability Case

In the case of Stuebe v. S.S. Industries, LLC., No. 2:18-cv-04035 (E.D. Pa. Aug. 26, 2019 Jones, J.), the court granted summary judgment in a product liability case holding that a suit initiating clause in a contract between the plaintiff and the defendant that required that any suit be brought within 90 days was enforceable and not unconscionable. 

The court noted that, under Pennsylvania law, parties to a contract may shorten an applicable statute of limitations if the agreed upon period is not manifestly unreasonable.   Reviewing other cases, the court noted that similarly short periods have been held to be enforceable by other courts.  

The court in this Stuebe case additionally noted that products liability actions are no different than any other type of claim with respect to these types of suit initiating clauses that serve to reduce the statute of limitations time period.  

The court additionally noted that the clause at issue was found not to be unconscionable because the Plaintiff’s right to sue was not cut off before he knew he was injured.   The law does not require that suit limitation clauses provide a Plaintiff with enough time to fully determine the extent of his or her injuries and/or damages.  

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

I send thanks to Attorney James A. Beck of the Philadelphia office of the Reed Smith law firm for bringing this case to my attention. 

Carrier Need Not Show Prejudice to Enforce Limitations of Action Provision

In the case of Mail Quip v. Allstate Ins. Co., No. 19-223 (E.D. Pa. May 23, 2019 Kenney, J.)(Mem. Op.), the court held that a carrier was not required to show prejudice to enforce a suit limitations provision of the policy.

In this case, the Plaintiff sued the carrier for breach of the insurance contract and for bad faith.  Allstate filed a motion to dismissed based upon its two year limitation of actions provision in the policy.  The Plaintiff had filed suit almost four years after the loss.

The federal district court noted that there was no Pennsylvania Supreme Court precedent on point but that the Third Circuit had issued decisions predicting that the Pennsylvania Supreme Court would rule that a showing of prejudice was not required for a carrier to enforce its limitation of actions provision.  As such, this court followed that precedent and dismissed the claims.

The court additionally held that the Plaintiff's bad faith claims were also barred by the two year statute of limitations applicable to those types of claims.

Anyone wishing to review this decision may click this LINK.

Source: Article:  "Court:  Insurer May Enforce Policy's Suit Limitations Provision" by Steven A. Meyerowitz in the Pennsylvania Law Weekly (June 18, 2019).