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Home My WebLink About92-195 civilJEAN TAUBE, in her own fight and as Guardian of the Estate and Person of Thomas Taube, an Incompetent, and all others similarly situated,' Plaintiffs VS. ERIE INSURANCE EXCHANGE, d/b/a ERIE INSURANCE GROUP and ERIE INSURANCE COMPANY, d~/a ERIE INSURANCE GROUP, Defendants · IN THE COURT OF COMMON PLEAS OF · CUMBERLAND COUNTY, PENNSYLVANIA · · · NO. 195 CIVIL 1992 · CLASS ACTION LAWSUIT · JURY TRIAL DEMANDED IN RE' DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT AND MOTION TO STRIKE JURY TRIAL DEMAND ORDER AND NOW, this day of February, 2001, the motion of the defendants for partial summary judgment is DENIED. The motion of the defendants to strike a jury trial demand on the count of bad faith is GRANTED. David L. Lutz, Esquire For the Plaintiff BY THE COURT, ess, J. Craig Murphey, Esquire For the Defendants :rlm JEAN TAUBE, in her own fight and as Guardian of the Estate and Person of Thomas Taube, an Incompetent, and all others similarly situated,: Plaintiffs VS. ERIE INSURANCE EXCHANGE, d/b/a ERIE INSURANCE GROUP and ERIE INSURANCE COMPANY, Wb/a ERIE INSURANCE GROUP, Defendants · 1N THE COURT OF COMMON PLEAS OF · CUMBERLAND COUNTY, PENNSYLVANIA · · · NO. 195 CIVIL 1992 · CLASS ACTION LAWSUIT ·JURY TRIAL DEMANDED IN RE' DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT AND MOTION TO STRIKE JURY TRIAL DEMAND BEFORE BAYLEY AND HESS, J.J. OPINION AND ORDER On January 16, 1992, a class action complaint was filed by Jean Taube on behalf of her son in his own right and all others similarly situated. The complaint averred that Erie made inadequate medical payments to catastrophically injured accident victims, and that Erie acted in bad faith in attempting to reduce or terminate first-party benefits. The facts as alleged in the complaint are as follows. On July 31, 1982, Thomas Taube was severely injured in an automobile accident. Since that time Taube has been incompetent to handle his own affairs. At the time of the accident, Taube was insured under a policy issued by Erie Insurance. The No-Fault-Motor Vehicle Insurance Act, 40 P.S. § 1009.101 et. seq. was in effect at the time of Taube's accident and governed the insurer's responsibilities. As a result of the injuries sustained in the accident Taube NO. 195 CIVIL 1992 suffered severe brain damage and quadriplegia. These injuries rendered Taube totally incompetent. After one year of hospitalizations, Taube was discharged home. Taube now requires twenty-four-hour per day care primarily to guard against respiratory and urinary tract infections. Erie Insurance initially offered to pay $4.50 per hour to provide in-home custodial care for Taube. In 1987, Erie Insurance increased the amount paid for in-home care to $4.75 per hour. Between 1989 and 1991, Erie Insurance denied two requests for Mrs. Taube to increase medical payments to allow for more qualified personnel to care for her son. The complaint alleges further that, despite numerous requests on behalf of Thomas Taube, Erie refused to increase its per hour figure. The complaint alleges that Erie has requested that plaintiff Jean Taube accept less than half of what she was previously receiving. The complaint also alleges that Erie had threatened Mrs. Taube by stating that if they did not accept Erie's reduced figure that she would not receive anything based on the Superior Court's holding in Pennsylvania National Mutual Casualty Insurance Company v. Fertig, 383 Pa. Super. 335, 555 A.2d 208 (Pa. Super. Ct. 1989). In June of 1990, Mrs.Taube received a letter from Erie Insurance informing her that Erie believed that under the holding of Reilly v. Southeastern Pa. Transport Auth., 507 Pa. 204, 489 A.2d 1291 (1985) and Pennsylvania Nat'l ~Mut. Casualty Ins. Co. v. Fertig, 382 Pa. Super. 335, 555 A.2d 208 (1989) it was no longer required to pay the cost of custodial care for no-fault insureds. Erie's letter threatened termination of medical payments thirty days from the date of the letter if Mrs. Taube did not agree to the settlement. Since July of 1983, Defendant Erie has been paying for Thomas Taube's medical care at the rate of approximately $41,900 per year. Erie made a final settlement offer to Mrs. Taube of $18,000, with a deadline of December 15, NO. 195 CIVIL 1992 1991. The principles announced in Fertig, supra, were reversed in Drake v. Pennsylvania Nat'l Mut. Casualty Ins. Co., 529 Pa. 44, 601 A.2d 797 (1992). Erie filed a motion for summary judgment with respect to the plaintiff's bad faith claim. This is the same claim as to which Erie once again seeks summary judgment. In our opinion of February 3, 1993, the court observed that Pennsylvania recognized no common law action for bad faith against an insurer, see D'Ambrosio v. Pennsylvania Nat'l Mut. Casualty Ins. Co., 494 Pa. 501,508, 431 A.2d 966, 970 (1981) and, therefore, the bad faith claim must necessarily rely on its statutory basis as out in 42 Pa.C.S.A. 8371. We concluded that, in order to make out a claim, the plaintiff was required to allege and prove conduct with occurred after the effective date of the statute, namely July 1, 1990. We granted leave to the plaintiff to amend their complaint to make such an allegation. An amended complaint was subsequently filed. The standard for summary judgment is well established. Summary judgment is properly granted where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law." Pennsylvania State University v. County of Centre, 532 Pa. 142, 143-145,615 A.2d 303,304 (1992) "The record must be viewed in the light most favorable to the nonmoving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party." Id__:. Among other things, the plaintiff alleges that Erie threatened termination of certain payments at a time when it knew or had reason to know that the law with respect to its obligations was not yet settled. For reasons which follow, this matter will be heard by the court sitting alone. We will, therefore, be particularly careful not to prejudge the facts of this case. NO. 195 CIVIL 1992 This matter has been the subject of lengthy consideration by the court. In something of an anticlimax, we will dispose of the motion now as succinctly as possible. Simply stated, we agree with the plaintiff that there are questions of material fact which remain open in this matter and the entitlement of Erie to summary judgment in its favor is not clear and free from doubt. Another issue before us is the defendant's motion to strike the plaintiff's demand for a jury trial. The defendants contend that parties proceeding under 42 Pa. C.S.A. section 8371 do not have a right to a jury trial. In Mishoe v. Erie Insurance Company, 762 A.2d 369 (Pa. Super. Ct. 2000), the Superior Court dealt with the issue of whether a party is entitled to demand a jury trial in an action for bad faith against an insurer pursuant to section 8371. The Superior Court found that, on its face, the section is silent with regard to the right to a jury trial. Id.__:. at 370. The court, in interpreting the statute, found that legislative silence gives rise to a presumption that the legislature did not intend to permit a jury determination of claims arising under section 8371. This is for the reason that the Pennsylvania legislature has expressly included provisions granting a right to jury trials in other statutory provisions. Id.__~. at 372. The Superior Court therefore determined that no statutory right to a jury trial exists under section 8371. Id.___~. at 373. Additionally, the court found that no right to a jury trial exists under the Pennsylvania Constitution for claims arising under section 8371, because "these are not claims which existed at the time of the adoption of the Pennsylvania Constitution." Id.._:. at 375. Finally, the court determined that the Seventh Amendment to the United States Constitution was only applicable to federal court proceedings and hence was not applicable in a state court proceeding under section 8371. Id. at 375. Accordingly, the defendants' motion to strike demand for jury trial will be granted. NO. 195 CIVIL 1992 ORDER AND NOW, this ~'° day of February, 2001, the motion of the defendants for partial summary judgment is DENIED. The motion of the defendants to strike a jury trial demand on the count of bad faith is GRANTED. David L. Lutz, Esquire For the Plaintiff BY THE COURT, ess, J. Craig Murphey, Esquire For the Defendants :rlm