Goll v. Insurance Co. of North America

WIEAND, Judge,

concurring and dissenting.

I respectfully dissent from the majority’s decision to reverse in part the summary judgments entered by the trial court. All claims made in the instant action were barred by the applicable statute of limitations. Therefore, I would affirm in toto the well reasoned decision of the trial court to enter summary judgment in favor of the defendant insurer. The statute of limitations is not tolled merely because one who makes a claim against an insurance company is unrepresented by counsel.

The majority has correctly recited the standard to be applied by an appellate court when reviewing the grant of summary judgment by a trial court. In determining whether the trial court erred in granting a motion for summary judgment, a reviewing court must determine whether the “pleadings, depositions, answers to interrogatories, admissions and affidavits show that there is no genuine issue as to any material fact, and the moving party is entitled to judgment as a matter of law." Pa.R.C.P. 1035(b) (emphasis added). See: Thompson v. Nason Hospital, 527 Pa. 330, 333, 591 A.2d 703, 704 (1991); Marks v. Tasman, 527 Pa. 132, 134, 589 A.2d 205, 206 (1991); Consumer Party of Pennsylvania v. Commonwealth, 510 Pa. 158, 174-175, 507 A.2d 323, 331 (1986); Thorsen v. Iron and Glass Bank, 328 Pa.Super. 135, 140-141, 476 A.2d 928, 930-931 (1984); Rybas v. Wapner, 311 Pa.Super. 50, 54, 457 A.2d 108, 109 *62(1983). The granting of a summary judgment, therefore, is reviewable for error of law.

Unfortunately, several Superior Court decisions have used language suggesting that a trial court’s grant of a motion for summary judgment will not be reversed in the absence of an abuse of discretion. This implies that the granting of a motion for summary judgment, is discretionary with the trial court. This is simply wrong. Whether to grant a motion for summary judgment is, purely and simply, an issue of law and reviewable as such.

The trial court in the instant case did not commit an error of law when it entered summary judgment in favor of INA, and because there was no error of law, I would affirm that decision. There was no error because, as a matter of law, all actions for work loss benefits were barred by the statute of limitations. See: Cunningham v. Insurance Company of North America, 515 Pa. 486, 530 A.2d 407 (1987); Gabovitz v. State Automobile Insurance Association, 362 Pa.Super. 17, 523 A.2d 403 (1987).

In Cunningham, the Supreme Court held that the statute of limitations had not been tolled by a prior class action1 which had been palpably non-justiciable because the class representative plaintiff lacked standing to maintain the action. In dismissing the action, the Court said:

Statutes of limitations embody important policy judgments that must be taken into account in determining the scope of application of the tolling principle. Those policy judgments include a belief that defendants should be protected against the prejudice of having to defend against stale claims, Insurance Company of North America v. Carnahan, 446 Pa. 48, 51, 284 A.2d 728, 729 (1971), as well as the notion that, at some point, claims should be laid to rest so that security and stability can be restored to human affairs, Schmucker v. Naugle, 426 Pa. 203, 205-206, 231 A.2d 121, 123 (1967). The defense of the statute of limitations is not a technical defense but *63rather is a substantial and meritorious one, and has been regarded as favored in the law and as advancing the welfare of society. Id.

Id., 515 Pa. at 491, 530 A.2d at 409.

In this case, appellants argue that the statute of limitations was tolled as to them by the prior action brought against Insurance Company of North America (INA) in Cunningham v. Insurance Company of North America, supra. However, the Cunningham action was non-justiciable because it was untimely and, therefore, barred by the statute of limitations. As such, it was not effective to toll the statute of limitations. Appellants’ argument, as the Supreme Court observed in Cunningham v. Insurance Company of North America, supra, 515 Pa. at 494, 530 A.2d at 411, “rests upon the faulty premise that the legislature, in enacting statutes of limitations, intended merely to assure that defendants would be given notice, within a given time frame, that there are individuals who might, if they were aware of their rights and desirous of pursuing them, bring actions against such defendants____ As stated in Crown, Cork & Seal Co., 462 U.S. [345], 352, 103 S.Ct. [2392], 2397, 76 L.Ed.2d [628], 635 [1983], ‘[limitations periods are intended to put defendants on notice of adverse claims and to prevent plaintiffs from sleeping on their rights____’” (emphasis in original).

I cannot help but observe, as did the Supreme Court in Cunningham, that counsel for the appellants in this case is the same counsel who filed the class actions in Nye and in Cunningham. In the Nye complaint,

there appears an admission that counsel’s purpose in bringing suit against thirty-one insurance companies even though he represented an insured of only one of them was that he sought to toll the statute of limitations for all carriers, inasmuch as counsel believed that many potential plaintiffs would not otherwise act upon their rights. We regard such an action as a clear abuse of the goals of class action procedures. The procedures do not exist to sanction what would be regarded by many as a course of *64officious intermeddling on the part of counsel, who, motivated by concern for plaintiffs who would not otherwise file suits, has embarked on a course of initiating litigation on behalf of those who have slept on their rights. Indeed, this case presents a most compelling example of tactics employed to subvert the legislative intent embodied in the statute of limitations, and the rules governing tolling will not be extended to give effect to such tactics.

Cunningham v. Insurance Company of North America, supra, 515 Pa. at 493-494, 530 A.2d at 410. The same reasoning is applicable to the instant attempt to use the untimely Cunningham action as a tolling device. I am satisfied, therefore, that the statute of limitations was not tolled by the untimely class action instituted by Cunningham.

I am also satisfied that the statute of limitations was not tolled by INA’s failure to advise its insureds before the Supreme Court decision in Allstate Insurance Co. v. Heffner, 491 Pa. 447, 421 A.2d 629 (1980) and/or the Superior Court decision in Freeze v. Donegal Mutual Insurance Co., 301 Pa.Super. 344, 447 A.2d 999 (1982), aff'd, 504 Pa. 218, 470 A.2d 958 (1983), that they might have claims for work loss benefits. Indeed, that was precisely the holding of the Superior Court in Gabovitz v. State Automobile Insurance Association, supra. There, the same counsel who represents the present appellants argued that the defendant-insurer was estopped to assert the defense of the statute of limitations because it had failed to alert its insureds that they might have a claim for work loss benefits. The Superior Court rejected this argument, saying:

“ ‘[I]n the absence of expressly proved fraud, there can be no estoppel based on the acts or conduct of the party sought to be estopped, where they are as consistent with, honest purpose and with absence of negligence as with their opposites.’ ” In re Tallarico’s Estate, 425 Pa. 280, 288, 228 A.2d 736, 741 (1967), quoting Northwestern National Bank v. Commonwealth, 345 Pa. 192, 196, 27 A.2d 20, 23 (1942). Thus, “[a] mutual mistake as to the law, knowledge of which is equally available to both parties, cannot raise an estoppel.” Ham v. Gouge, 214 *65Pa.Super. 423, 426, 257 A.2d 650, 652 (1969). Similarly, an estoppel cannot be created by representations or opinions concerning matters of law. See: 31 C.J.S. Estoppel § 79.
[T]he record is clear that the delay by Gabovitz in filing her claim for work loss benefits was attributable not to any action or inaction on the part of [the insurer], but rather to her own mistaken judgment that such benefits simply were not available under the No-fault Act. As we have already suggested, Gabovitz’s misconception regarding her right to recover is not a ground upon which an estoppel will lie. As a matter of law, therefore, State Auto is not estopped from asserting the defense of the statute of limitations.

Id., 362 Pa.Superior Ct. at 23-25, 523 A.2d at 406-407.

Gabovitz has not been overruled by the Supreme Court in Dercoli v. Pennsylvania National Mutual Ins. Co., 520 Pa. 471, 554 A.2d 906 (1989) or by the Superior Court in Miller v. Keystone Insurance Co., 402 Pa.Super. 213, 586 A.2d 936 (1991), alloc. granted, 528 Pa. 631, 598 A.2d 284 (1991).2

In Dercoli, the Supreme Court expressly decided the following issue: “[W]hether the duty of fair dealing and good faith requires an automobile insurer to properly advise its insured of the insured’s entitlement to present a claim or claims under the applicable policy where the insurer advises its insured that legal representation is unnecessary and induces the insured to rely upon the insurer to pay appropriate benefits?” Id., 520 Pa. at 473, 554 A.2d at 907 (emphasis added). The trial court had sustained the defendant-insurer’s demurrer to the plaintiff’s complaint and had dismissed the plaintiff’s suit against the insurers. Therefore, the Court accepted as true all material facts and reasonable inferences alleged in the complaint. These included the following:

*6617. At all times herein material, Plaintiff was not represented by legal Counsel, and Defendants’ Agents represented to and assured Plaintiff that her claim would be processed without the need for Plaintiff to be independently represented.
18. Plaintiff reasonably relied entirely upon the advice of Defendants’ agents as to the nature and extent of benefits which were due to her under said insurance contracts. Further, Defendant’s agents were fully cognizant of Plaintiffs said reasonable reliance and lack of independent representation, (emphasis added).

Instead of adequately informing the plaintiff regarding the benefits due under her automobile insurance policy, the insurers in Dercoli had withheld recent changes in the law regarding interspousal immunity which would have enabled the plaintiff to increase her recovery from the insurers. Under these circumstances, where the insurers’ agents “voluntarily undertook to provide assistance and advice to [the plaintiff] and in the process advised her against retaining independent legal counsel,” the Supreme Court held the insurers had breached their duty of good faith and fair dealing to the plaintiff-insured. Id., 520 Pa. at 477, 554 A.2d at 909.

The lead opinion in Dercoli was authored by Justice Larsen, with only one other Justice joining. The narrow scope of the Court’s holding was demonstrated by a concurring opinion, written by Justice Papadakos and joined by Justice McDermott, which observed that the “insurers [had] breached a voluntarily assumed fiduciary duty to provide [plaintiff] with all available benefits, ...,” and further, that “in this case, the insurers themselves voluntarily [had] transformed themselves into legal advisors to the [plaintiff].” Id., 520 Pa. at 481-482, 554 A.2d at 911. Under these circumstances, a majority of the Court refused to apply the bar of the statute of limitations. Chief Justice Nix and Justices Flaherty and Zappala dissented.

Miller v. Keystone Insurance Co., supra, was an unwarranted extension of Dercoli. It held that where an insured *67was unrepresented by counsel a duty to advise the insured of his or her rights under a policy of automobile insurance was imposed upon the insurer “implicitly” by the terms of the No-fault Motor Vehicle Insurance Act. This statute, the Court observed, “encouraged claimants to place their trust in their insurance companies to see to it ... that they would receive all to which they were entitled under the Act.” Id., 402 Pa.Superior Ct. at 224-225, 586 A.2d at 942. In effect, the Miller court sought to extend the Dercoli holding to all persons who have a claim against an insurance company while they are unrepresented by counsel. To hold that the statute of limitations was not applicable to such claimants, however, ignored the purposes of the statute of limitations to bar actions by claimants who have slept on their rights.

A careful review of Dercoli reveals that a majority of the Supreme Court did not simply rely on the fact that the plaintiff therein had been unrepresented by counsel. Rather, it was the voluntary acts of the agents of the insurers which made the crucial difference to the authors of the lead and concurring opinions in Dercoli. Neither Dercoli nor any appellate decision prior to Miller has held that a Pennsylvania insurer owes a duty to provide its insured with legal advice regarding whether or when to sue the insurer. Indeed, such a notion is contrary to the recent decision in Kilmore v. Erie Insurance Co., 407 Pa.Super. 245, 595 A.2d 623 (1991), where Judge Tamilia, writing for the majority, appropriately observed:

Assuming, arguendo, the nature of an insurance contract presumes the insurer assumes the responsibility for processing its insured’s claim, we find no evidence the remaining Dercoli factors were established. [Plaintiffs] have not asserted that they, as the insureds, were acting in reliance upon the insurers’ advice and counsel. In fact, it appears advice and counsel from the respective insurers was neither sought nor offered, and in the absence of the former action we find no requirement of the latter.

Id., 407 Pa.Superior Ct. at 251-252, 595 A.2d at 626.

The plaintiffs in the instant case have not alleged that INA voluntarily offered to process their respective claims *68without the need for independent representation. Although plaintiffs argue, in conclusory fashion, that they reasonably relied on INA for their benefits, there is no evidence that INA induced or encouraged such reliance or, indeed, that INA had any knowledge that the insureds were relying on their insurer for advice. Absent proof that the insurer deliberately induced its insured to forego legal representation and rely upon it for advice or, at least, that the insurer was aware that its insured was relying on its advice and counsel, I am unable to join the majority’s ruling that the insurer breached its duty of good faith and fair dealing by failing to pay work loss benefits for which no claim had been made. When the statute of limitations expired, the instant claims for work loss benefits were barred. Here, as in Gabovitz, it “is clear that the delay [by plaintiffs] in filing [their] claim[s] for work loss benefits was attributable not to any action or inaction on the part of the [insurer] but, rather, to [the] mistaken judgment that such benefits simply were not available under the No-fault Act.” Gabovitz v. State Auto Insurance Association, supra, 362 Pa.Superior Ct. at 25, 523 A.2d at 407. For this reason, I would affirm the judgments entered by the trial court on all claims.

. This action was Nye v. Erie Insurance Exchange, 504 Pa. 3, 470 A.2d 98 (1983).

. The Miller court attempted to distinguish the Gabovitz decision, although it is questionable whether there is any real difference.