Opinion
CIVIL ACTION No. 02-8384
March 17, 2003
MEMORANDUM
This action arises out of the relationship between plaintiffs and defendant as insured and insurer. There are six counts enumerated in the complaint. The first two counts allege bad faith by defendant insurer, first in the refusal to pay a claim and second in the wrongful cancellation of plaintiffs' policy. The other four counts are for intentional infliction of mental distress, loss of consortium, civil conspiracy and punitive damages. I have before me defendant's motion to dismiss four of the counts, plaintiffs' memorandum of law in opposition thereto and defendant's response to plaintiffs' memorandum of law.
Although the complaint labels Count III "Negligent Infliction of Mental Distress," the text of the pleading makes clear that plaintiff seeks to recover damages for intentional infliction of emotional distress.
BACKGROUND
Plaintiffs filed a complaint against defendant in the Court of Common Pleas of Philadelphia County in October 2002. Thereafter defendant properly removed the action to this Court.
Plaintiff Ramone Echevarria was the insured and plaintiff Carmen Echevarria a named driver under automobile insurance policy number 8000289 issued by defendant. The policy covered plaintiffs' 2001 Mitsubishi Montero.
On February 5, 2002, plaintiff Ramone Echevarria mailed a personal check for the amount due on February 8, 2002 to renew the policy. Plaintiffs coverage was not renewed, but rather lapsed as it would if no payment had been received. Plaintiffs assert that defendant never notified them of the lapse in their coverage. Defendant did notify the Pennsylvania Department of Motor Vehicles, which in turn notified plaintiffs that they were uninsured.
On or about February 28, 2002 plaintiffs' Mitsubishi Montero was stolen, resulting in the total loss of the car, certain personal property and consequential damages. Ramone Echevarria submitted a claim of $37,471.32 to defendant for these losses. Defendant denied this claim, stating that plaintiffs' policy had been cancelled for non-payment of the premium.
Plaintiffs informed defendant that they had mailed a check for the amount of the premium on February 5, 2002. Subsequently, defendant reinstated plaintiffs' coverage.
Although plaintiffs' policy has been reinstated, plaintiffs assert that they have not received any money as a result of their claim. Count I in the complaint is brought under 42 Pa. C.S. § 8371 (2003) for the wrongful denial, in bad faith, of this claim. Count II is brought under the same statute for the bad faith wrongful cancellation of their policy that they allege occurred in February and March 2002.
The remaining four counts are based on the manner in which defendant treated plaintiffs during the claims process. According to the complaint, defendant engaged in an extensive investigation concerning plaintiffs' claim. The investigation included interviews of plaintiffs and requests for documents, including income tax returns. Plaintiffs allege that the investigation was conducted in such a manner that defendant knew or should have known would cause plaintiffs to suffer severe emotional distress and the physical ailments and loss of consortium that followed.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(6) permits a court to dismiss all or part of an action for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). A motion to dismiss under Fed.R.Civ.P. 12(b)(6) does not address the merits of a case but rather tests the legal sufficiency of the complaint. See Conley v. Gibson, 355 U.S. 41, 45-46 (1957).
In ruling on a 12(b)(6) motion, I must accept as true all well-pleaded allegations of fact, and any reasonable inferences that may be drawn therefrom, in plaintiffs' complaint and must determine whether "under any reasonable reading of the pleadings, the plaintiff[s] may be entitled to relief." Nami v. Fauver, 82 F.3d 63, 65 (3d Cir. 1996) (citations omitted). "The complaint will be deemed to have alleged sufficient facts if it adequately put the defendant on notice of the essential elements of the plaintiffs' cause of action." Id. Although I must construe the complaint in the light most favorable to plaintiffs, I need not accept as true legal conclusions or unwarranted factual inferences. See Conley, 355 U.S. at 45-46. Claims should be dismissed under Rule 12(b)(6) only if "it appears beyond doubt that the plaintiff[s] can prove no set of facts in support of his claim which would entitle him to relief." Id.
After the same analysis I may dismiss a claim for which no motion to dismiss has been filed. "It is well established that, even if a party does not make a formal motion to dismiss, the court may, sua sponte, dismiss the complaint where the inadequacy of the complaint is clear."Taxacher v. Torbic, 2000 U.S. Dist. LEXIS 15193, at *9 (W.D. Pa. Feb. 23, 2000) (quoting Michaels v. New Jersey, 955 F. Supp. 315, 331 (D.N.J. 1996)). In this circuit a court may on its own initiative enter an order dismissing the action if the complaint affords a sufficient basis for the court's action. Bryson v. Brand Insulations, Inc., 621 F.2d 556, 559 (3d Cir. 1980).
DISCUSSION
Defendant has moved for dismissal of counts III, IV, V and VI. In addition to dismissing Count III, V and VI, I will dismiss Count II sua sponte.
I. Count II — Bad Faith Insurer — Wrongful Cancellation
Plaintiffs' claim for wrongful cancellation of their insurance policy is brought under Pennsylvania's bad faith statute, 42 Pa. C.S. § 8371 (2002). The statute provides:
In an action arising under an insurance policy, if the court finds that the insurer has acted in bad faith toward the insured, the court may take all of the following actions:
(1) Award interest on the amount of the claim from the date the claim was made by the insured. . . .
(2) Award punitive damages against the insurer.
(3) Assess court costs and attorney fees against the insurer.
42 Pa. C.S. § 8371 (2002).
The wrongful cancellation claim is not based on the wrongful denial of plaintiffs' insurance claim, but rather on separate conduct. Plaintiffs may recover on this claim, therefore, only if Section 8371 provides for recovery for bad faith insurance practices other than treatment of insurance claims. I find that Section 8371 does not provide a claim for wrongful cancellation of an insurance policy, and accordingly will dismiss Count II of the complaint.
My colleague Judge Yohn recently held that "Section 8371 is limited to causes of action arising out of the bad faith handling or payment of claims and does not apply to conduct unrelated to the denial of a claim."Berks Mutual Leasing Corp. v. Travelers Property Cas., 2002 U.S. Dist. LEXIS 23749, at *18 (E.D. Pa. Dec. 9, 2002). Judge Yohn based his conclusion on an examination of Pennsylvania law. He considered the statutory language and legislative history of Section 8371, the definition of bad faith used in Pennsylvania case law and the prima facie case for a Section 8371 claim that was developed by the Pennsylvania Superior Court. Id. at * 12-19.
I find Judge Yohn's analysis in Berks Mutual to be thorough and agree with his conclusion.
II. Count III — Intentional Infliction of Mental Distress
Although the Pennsylvania Supreme Court has not expressly adopted the tort of intentional infliction of emotional distress as defined in the Second Restatement on Torts, "the third circuit has confronted this question . . . and has repeatedly held that Pennsylvania does recognize the tort, in spite of `speculation' to the contrary." Weinstein v. Bullick, 827 F. Supp. 1193, 1203 (E.D. Pa. 1993), citing Silver v. Mendel, 894 F.2d 598, 606 (3d Cir. 1990).
The Restatement defines intentional infliction of emotional distress as enforcing the principle that "[o]ne who by extreme and outrageous conduct intentionally or recklessly causes severe emotional distress to another is subject to liability for such emotional distress, and if bodily harm to the other results from it, for such bodily harm." Restatement (Second) of Torts § 46(1) (1965). As recently as 1998 the Pennsylvania Supreme Court addressed the possibility of recovery under this tort in Hoy v. Angelone, 720 A.2d 745 (Pa. 1998).
Hoy confirmed that intentional infliction of emotional distress is a tort of very limited applicability. To recover under the tort a plaintiff must prove conduct that is "so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized society."Id. at 754 (quoting Buczek v. First Nat'l Bank of Mifflintown, 531 A.2d 1122, 1125 (Pa. 1987)). A claim for intentional infliction of emotional distress can be made only in cases of "the most egregious conduct" Id. Examples of such behavior include a driver fatally striking plaintiff's son and, without notifying the authorities, burying the body a field, Papieves v. Lawrence, 263 A.2d 118 (Pa. 1970); defendants intentionally falsifying records to implicate plaintiff in a homicide for which plaintiff later went to jail, Banyas v. Lower Bucks Hosp., 437 A.2d 1236 (Pa.Super. 1986); and a doctor telling the press that plaintiff was suffering from a fatal disease when the doctor knew that information was false, Chuy v. Eagles Football Club, 595 F.2d 1265 (3d Cir. 1979).
The facts of Hoy involved an employment situation in which a jury found that the defendant sexually harassed the plaintiff by subjecting her to sexual propositions, touching of the back of her knee, off-color jokes, profanity and sexually suggestive pictures in the workplace. Hoy, 720 A.2d at 754-55. The Pennsylvania Supreme Court held that "the conduct exhibited by [defendant], while unacceptable, was not so extremely outrageous, and not akin to the cases noted above, that would allow for recovery under this most limited of torts." Id. at 755.
Like the conduct in Hoy, the actions that Plaintiff's allege defendant took simply do not rise to the level of egregiousness necessary to support a claim for intentional infliction of emotional distress under Pennsylvania law. Plaintiffs claim that defendant's investigator implied that plaintiffs were lying abut their car being stolen and that defendant's lawyer insisted on plaintiffs responding to questions about their history of criminal or fraudulent conduct. Compl. ¶¶ 30-31. Plaintiffs also allege that defendant first requested two years of their income tax returns and then requested three additional years of returns from plaintiffs. Compl. ¶ 32.
Plaintiffs both claim that the manner in which they were treated by defendant and its agents caused them physical and mental harm. Compl. ¶¶ 43-44. Accepting defendant's alleged conduct and plaintiffs' claimed injuries as true, the complaint fails to state a claim upon which relief may be granted. The conduct described in the complaint, if it occurred, was unprofessional and may have caused plaintiffs emotional distress and resulting physical ailments, but it simply is not "so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized society." Hoy, 720 A.2d at 755. Accordingly, I will dismiss plaintiffs' claim for intentional infliction of emotional distress.
III. Count IV — Loss of Consortium
Plaintiff Carmen Echevarria makes a claim for loss of consortium as a result of injuries suffered by plaintiff Ramone Echevarria due to his treatment by defendant. This claim will survive defendant's motion for dismissal as a derivative claim to the remaining Section 8371 bad faith claim.
Under Pennsylvania law, a wife's consortium claim derives only from the injured husband's right to recover in tort. See Little v. Jarvis, 280 A.2d 617, 620 (Pa.Super. 1971); Wakshul v. City of Phila., 998 F. Supp. 585, 590 (E.D. Pa. 1998). Recently the Court of Appeals upheld a district court prediction that the Supreme Court of Pennsylvania would recognize a Section 8371 claim as a tort cause of action. See Haugh v. Allstate Ins. Co., 2003 U.S. App. LEXIS 3721, at *23 (Feb. 28, 2003 3d Cir.). Accordingly, Plaintiff Ramone Echevarria's claim under Pennsylvania's bad faith statute for the wrongful denial of his claim sounds in tort and I will not dismiss Plaintiff Carmen Echevarria's claim for loss of consortium.
IV. Count V — Civil Conspiracy
Plaintiffs claim of civil conspiracy will be dismissed because there is only one alleged wrongdoer. Under Pennsylvania law, a "single entity cannot conspire with itself and, similarly, agents of a single entity cannot conspire among themselves." Simon v. UnumProvident Corp., 2002 U.S. Dist. LEXIS 9331, at *30 (E.D. Pa. May 28, 2002) (quoting Rutherford v. Presbyterian-University Hosp., 612 A.2d 500, 508 (Pa.Super. 1992)). Plaintiffs have only named defendant and its agents as tortious actors.
V. Count VI — Punitive Damages
Punitive damages are specifically provided for in Section 8371. Plaintiffs may be awarded punitive damages if they succeed on their wrongful denial of benefits claim under Section 8371. There is no independent tort claim pending for which a separate claim for punitive damages would be appropriate. Therefore, I will dismiss Count VI.
An appropriate Order follows.
ORDER
AND NOW, this ___ day of March, 2003, after consideration of defendant's motion to dismiss, plaintiffs memorandum of law in opposition thereto and defendant's response to plaintiffs memorandum of law, and for the reasons set forth in the accompanying memorandum, defendant's motion to dismiss is GRANTED as to Counts III, V and VI and DENIED as to Count IV. The Court sua sponte DISMISSES Count II.