J-A09036-19
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
ALLEN FEINGOLD : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
STATE FARM INSURANCE COMPANY : No. 2340 EDA 2018
Appeal from the Order Entered August 1, 2018
In the Court of Common Pleas of Philadelphia County Civil Division at
No(s): 003216 July Term, 2018
RUTH WALLACE, JOHN WALLACE, : IN THE SUPERIOR COURT OF
WILLIAM WALLACE AND JAMIE : PENNSYLVANIA
WALLACE :
:
:
v. :
:
:
STATE FARM MUTUAL AUTOMOBILE : No. 2833 EDA 2018
INSURANCE COMPANY :
:
:
APPEAL OF: ALLEN FEINGOLD :
Appeal from the Order Entered September 5, 2018
In the Court of Common Pleas of Philadelphia County Civil Division at
No(s): April Term, 2001, No. 02380
BEFORE: KUNSELMAN, J., MURRAY, J., and PELLEGRINI*, J.
MEMORANDUM BY PELLEGRINI, J.: FILED MAY 17, 2019
Allen Feingold (Feingold) appeals from the orders of the Court of
Common Pleas of Philadelphia County (trial court) dismissing his complaint as
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* Retired Senior Judge assigned to the Superior Court.
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frivolous under Pa.R.C.P. 240(j)(1) as well as denying his motion to intervene.
We affirm.
Both of these consolidated appeals involve a disbarred former attorney
attempting to recover against an insurer based on a purported assignment of
claims from his former clients. In 1995, John, William and Jaime Wallace (the
Wallaces) were in a car accident. The Wallaces later hired Feingold to be their
personal injury attorney. In 2001, Feingold filed a petition to compel
arbitration on the Wallaces’ underinsured motorist (UIM) claims against their
insurer, State Farm Mutual Automobile Insurance Company (State Farm).1
Two years later, an arbitration panel determined that the Wallaces suffered
$9,500 in damages. Because the third-party motorist’s liability coverage
exceeded that amount, State Farm did not pay the Wallaces’ UIM arbitration
award. In 2005, the Wallaces settled their claims against the third-party
motorist for $15,000. Feingold was disbarred in 2008.
On July 27, 2018, Feingold file a pro se complaint against State Farm
raising claims of breach of contract and bad faith because State Farm failed
to pay the $9,500 the arbitration panel found were the damages suffered by
the Wallaces. Feingold attached to his complaint a purported agreement
between himself and the Wallaces. In the agreement, the Wallaces assigned
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1The Wallaces’ mother, Ruth Wallace, was also involved in the accident and a
plaintiff in the petition to compel arbitration, but her UIM claim was settled
before arbitration.
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to Feingold 100% of any claims they had against State Farm as compensation
for his past work and expenditures on their behalf. Feingold
contemporaneously filed a petition to proceed in forma pauperis (IFP) with the
complaint. Three days later, the trial court entered an order that denied
Feingold IFP status and dismissed his complaint as being frivolous under
Pa.R.C.P. 240(j)(1).
On August 3, 2018, Feingold filed a notice of appeal of the trial court’s
dismissal of his complaint. That same day, he also filed a motion to intervene
on the long-dormant docket for his 2001 motion to compel arbitration. In his
motion, Feingold requested leave to file a motion to recover the unpaid
arbitration award, interest, costs and sanctions against State Farm. He also
attached the same purported assignment by the Wallaces that he filed with
his dismissed complaint. After the trial court denied Feingold’s motion to
intervene, Feingold filed another appeal which this Court consolidated with his
appeal from the dismissal of his complaint.
Feingold now raises three issues for our review:
1. Whether the trial court erred in dismissing [Feingold’s]
petition for IFP status in No. 2340 [EDA 2018]?
2. Whether the trial court abused its discretion and erred as a
matter of law in dismissing [Feingold’s] complaint in No.
2340 [EDA 2018] as frivolous?
3. Whether the trial court erred in denying [Feingold’s] petition
to intervene in the action at No. 2833 [EDA 2018]?
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We first address if the trial court erred in dismissing Feingold’s petition
for IFP status that he filed with his complaint.2 He raises two arguments in
support of this claim. First, he faults the trial court for dismissing his IFP
petition and complaint in the same order, arguing that Pa.R.C.P. 240(j)(1)
requires the determination of frivolity to be undertaken before consideration
of IFP status. Second, he claims the trial court abused its discretion or erred
in concluding he was not entitled to IFP status.
Rule 240(j)(1) of the Pennsylvania Rules of Civil Procedure provides:
If, simultaneous with the commencement of an action or
proceeding or the taking of an appeal, a party has filed a petition
for leave to proceed in forma pauperis, the court prior to acting
upon the petition may dismiss the action, proceeding or appeal if
the allegation of poverty is untrue or if it is satisfied that the
action, proceeding or appeal is frivolous.
Pa.R.C.P. 240(j)(1).
Feingold’s initial argument is that the trial court did not comply with the
Rule because the trial court’s order denied him IFP status in the sentence
before dismissing his complaint, while the Rule requires that the complaint be
dismissed before the IFP status is denied. This argument is way beyond
frivolous. As this Court has observed, Rule 240(j) allows trial courts to make
their IFP and frivolity determinations simultaneously. See, e.g., Conover v.
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2 “In reviewing a trial court’s resolution of an application to proceed in forma
pauperis, we reverse only if the court abused its discretion or committed an
error of law.” Amrhein v. Amrhein, 903 A.2d 17, 19 (Pa. Super. 2006)
(quotation omitted).
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Mikosky, 609 A.2d 558, 560 (Pa. Super. 1992) (“[I]f upon consideration of
an in forma pauperis petition the trial court determines that the underlying
claim in the complaint, procedure or appeal is frivolous, the trial court should
dismiss that claim and expressly state so in its order.”). Feingold cites to
Ocasio v. Prison Health Services, 979 A.2d 352 (Pa. Super. 2009), which
involved a trial court that determined a complaint to be frivolous before it
denied IFP status. However, the claim that Feingold seeks to raise—that a
court can be divested of jurisdiction based on the order in which it determines
IFP and frivolity—was not involved in Ocasio. Indeed, nothing in our Ocasio
decision suggests that a trial court’s determination of frivolity and IFP status
cannot be made at the same time.
Moreover, we find no abuse of discretion in the trial court’s
determination concerning the underlying merits of Feingold’s request for IFP
status. “A party who is without financial resources to pay the costs of litigation
is entitled to proceed in forma pauperis.” Pa.R.C.P. 240(b). A trial court “has
considerable discretion in determining whether a person is indigent for
purposes of an application to proceed in forma pauperis.” D.R.M. v. N.K.M.,
153 A.3d 348, 351 (Pa. Super. 2016) (quotation omitted).
In this case, the trial court explained its reasons for denying Feingold’s
IFP petition:
Here, [Feingold] failed to demonstrate a lack of financial resources
to pay the costs of litigation. [Feingold] previously filed an IFP
Petition with this court on January 17, 2018. After a hearing, this
court denied the IFP Petition. The IFP Petition [Feingold]
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submitted in this case represented no change in [Feingold’s]
ability to pay the costs of litigation. [Feingold] indicated he
receives $2,513.00 per month in social security benefits, which
equates to $30,156 per year. Although [Feingold] alleges two
individuals are dependent upon him for support, [Feingold]
remains far above the federal poverty line. [Feingold] does not
appear to have difficulty obtaining the necessities of life.
See Trial Court Opinion, 10/10/18, at unnumbered 8-9 (footnote omitted).
Feingold claims the trial court based its determination on his interest in
a condominium, but this is belied by the trial court’s above reasoning, which
was based on Feingold’s social security benefits. Further, Feingold attempts
to rely on IFP orders in other cases in which he was permitted to proceed IFP
status. We find this unavailing as those decisions have no bearing on the trial
court’s own IFP determination.
Next, Feingold argues that the trial court erred in dismissing his
complaint as frivolous under Pa.R.C.P. 240(j)(1). He also contends that even
if the frivolity determination was correct, the trial court should have granted
leave to amend the complaint rather than dismissing it.3
“A frivolous action or proceeding has been defined as one that lacks an
arguable basis either in law or in fact.” Pa.R.C.P. 204(j)(1), at Note (citation
and internal quotation marks omitted). An action is considered frivolous under
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3 “Appellate review of a decision dismissing an action pursuant to Pa.R.C.P.
240(j) is limited to a determination of whether an appellant’s constitutional
rights have been violated and whether the trial court abused its discretion or
committed an error of law.” Bell v. Mayview State Hosp., 853 A.2d 1058,
1060 (Pa. Super. 2004).
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Rule 240(j), “if, on its face, it does not set forth a valid cause of action.”
Ocasio, 979 A.2d at 354 (citation omitted).
The first claim that Feingold raised in his complaint was for breach of
contract. To state a claim for breach of contract, a plaintiff must establish:
“(1) the existence of a contract, including its essential terms; (2) a breach of
a duty imposed by the contract; and (3) resulting damages.” Telwell v.
Grandbridge Real Estate Capital, LLC, 143 A.3d 421, 427 (Pa. Super.
2016) (quotation omitted).
In finding this claim frivolous, the trial court explained that Feingold did
not demonstrate the existence of a contract between the Wallaces and State
Farm, failing to attach the contract to his complaint or even include its
essential terms. See Trial Court Opinion, 10/10/18, at unnumbered 5-6.
Moreover, the trial court noted, Feingold did not allege with any particularity
the damages suffered by the alleged beach. See id. at 6. Based on our own
review of the July 27, 2018 complaint, we agree with this analysis and find
that the trial court did not abuse its discretion or err in finding that the
complaint failed to state a claim for breach of contract.
We find the same as to Feingold’s claim for bad faith. An insured has a
cause of action “if the court finds that the insurer has acted in bad faith toward
the insured[.]” 42 Pa.C.S. § 8371. To prove a bad faith claim, the insured
must present clear and convincing evidence that (1) the insurer did not have
a reasonable basis for denying benefits under the policy, and (2) the insurer
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knew or recklessly disregarded its lack of reasonable basis in denying the
claim. See Rancosky v. Washington Nat. Ins. Co., 130 A.3d 79, 92-93
(Pa. Super. 2015).
Based on our review of his complaint, Feingold failed to allege either
requisite element. First, Feingold averred that after the UIM arbitration award,
State Farm informed him that it did not believe the Wallaces were entitled to
UIM damages under their policy. Feingold’s complaint did not allege that State
Farm was without a reasonable basis for denying benefits. Second, Feingold
averred only that State Farm did not advise him of a specific reason for
denying the Wallaces UIM claims. This is not sufficient to demonstrate that
State Farm knew or recklessly disregarded its lack of a reasonable basis for
denying the claim. Accordingly, we find no abuse of discretion or error in the
trial court’s determination that the bad faith claim was frivolous.
Further, we find no abuse of discretion in the trial court declining to
allow Feingold to amend his complaint. The trial court noted that the statute
of limitations had long expired for both breach of contract, 42 Pa.C.S. § 5525
(four years), and bad faith, 42 Pa.C.S. § 5524 (two years). Here, Feingold
filed his complaint more than 23 years after the Wallaces’ accident and 13
years after all of the Wallaces had turned at least 18 years old. Feingold’s
brief does not show how a more specific amended complaint would overcome
the statute of limitations.
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Last, Feingold argues that the trial court erred in denying his motion to
intervene.4 Under Pennsylvania Rule of Civil Procedure 2347, there are four
classes of persons that may intervene during the pendency of an action:
(1) the entry of a judgment in such action or the satisfaction of
such judgment will impose any liability upon such person to
indemnify in whole or in part the party against whom judgment
may be entered; or
(2) such person is so situated as to be adversely affected by a
distribution or other disposition of property in the custody of the
court or of an officer thereof; or
(3) such person could have joined as an original party in the action
or could have been joined therein; or
(4) the determination of such action may affect any legally
enforceable interest of such person whether or not such person
may be bound by a judgment in the action.
Pa.R.C.P. 2347. Feingold contends that he would fall within the fourth class
based on the Wallaces’ assignment of claims to him against State Farm.
However, in so arguing, Feingold fails to address how he would be able to
avoid the statute of limitations for any of the UIM claims for which he sought
leave to file. The trial court explained in its Pa.R.A.P. 1925(a) opinion:
[T]he determination of this action would not affect “any legally
enforceable interest” of [Feingold] because the applicable statute
of limitations barred any breach of contract action regarding [UIM]
benefits and any insurance bad faith action in this case. More
specifically, [the Wallaces] settled their claims against the
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4 “It is well established that a question of intervention is a matter within the
sound discretion of the trial court and absent a manifest abuse of such
discretion, its exercise will not be disturbed on review.” First
Commonwealth Bank v. Heller, 863 A.2d 1153, 1155 (Pa. Super. 2004)
(quotation omitted).
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underinsured motorist in 2005. Therefore, [the Wallaces] had
until 2009 to bring an action against [State Farm] seeking
compensation for [UIM] benefits under their insurance policy.
Neither [the Wallaces] nor [Feingold] (via the alleged assignment)
did that. Instead, [Feingold] brought an action against [State
Farm] nine years after the statute of limitations barred such a
breach of contract claim.
Additionally, if [Feingold] argues that [State Farm] committed bad
faith by not paying [UIM] benefits to [the Wallaces] after [they]
settled with the underinsured motorist in 2005, then [the
Wallaces] had until 2007 to bring a bad faith claim. Neither [the
Wallaces] nor [Feingold] (via the alleged assignment) did that.
Instead, [Feingold] brought an insurance bad faith action against
[State Farm] eleven years after the statute of limitations had
barred such a claim. As such, [Feingold] had no “legally
enforceable interest” entitling him to intervene in this matter.
Therefore, the trial court properly denied [Feingold’s] Motion to
Intervene.
Trial Court Opinion, 10/15/18, at unnumbered 4. Because Feingold has not
provided any discussion that would rebut this analysis, we discern no abuse
of discretion in the trial court denying his motion to intervene.
Orders affirmed. Application to Substitute Paginated Supplemental
Reproduced Record granted.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 5/17/19
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