eNotes: Liability – January 2023 – Pennsylvania

SIGNIFICANT CASE SUMMARIES

Pennsylvania Case Summaries

McGuire v. City of Pittsburgh
Pennsylvania Supreme Court
No. 26 WAP 2021

Decided: November 23, 2022

Pennsylvania Supreme Court affirms decision that the City did not have a statutory duty to indemnify police officer.

Background

In 2012, a sixteen-year-old McGuire and some friends vandalized holiday decorations and created a booby trap tower of bricks on the doorstep of a nearby home. After watching the family’s reaction, McGuire attempted to flee, tripping over his own booby trap and creating a commotion. The homeowner, an off-duty Pittsburgh police officer, heard the noise and ran down McGuire without identifying himself. He caught McGuire, punched the sixteen-year-old in the face, and restrained him until on-duty police could arrive. Two years later, McGuire filed and won a lawsuit against the officer for use of unreasonable force while acting under color of state law. The jury entered a verdict against the officer for $235,575. The officer did not seek indemnification from the City of Pittsburgh, instead assigning his right to sue the City for indemnity to Plaintiff.

McGuire sued the City in Allegheny County, seeking a declaratory judgment that the City was required to indemnify the officer under the Political Subdivision Tort Claims Act (“PSTCA”). The Trial Court held that the officer was not acting within the course and scope of his duties, and the City was not required to indemnify. McGuire then appealed to the Commonwealth Court. McGuire argued that a jury had already found that the officer was acting under color of state law under 42 U.S.C. § 1983, and that this is synonymous with “scope of his office or duties” as used in the PSTCA. McGuire argued that this determination collaterally estopped the City from re-litigating the matter in court. The Commonwealth Court disagreed with McGuire and affirmed the Trial Court’s holding. McGuire then appealed, seeking a declaratory judgment from the Pennsylvania Supreme Court.

Holding

The Supreme Court rejected McGuire’s arguments and held that the jury decision that the officer acted under color of state law was not a judicial determination that he acted within the scope of his office or duties under the PSTCA. The Supreme Court agreed with the Commonwealth Court that “scope of his office or duties” is not synonymous with “under color of state law.” “A police officer may sometimes act both ‘under color of state law’ and beyond the scope of his or her employment.” The Supreme Court accordingly affirmed the holdings of the Lower Courts. Justice Donohue wrote a concurring opinion, which Justice Mundy joined.

Questions about this case can be directed to Logan Nagle at (717) 255-7234 or lnagle@tthlaw.com.

Gito, Inc. v. Hardy
Pennsylvania Superior Court
No. 265 WDA 2022

Decided: December 9, 2022

In an action for libel, a plaintiff must attach a copy of the defamatory statement to its pleading, pursuant to Rule 1019(i) of the Pennsylvania Rules of Civil Procedure.

Background

On October 28, 2021, Gito, Inc. d/b/a Nello Construction Company (hereinafter “Nello”) filed a Complaint against Jamison Hardy. In the Complaint, Nello asserted a single count for libel per se against Hardy. The Complaint alleged that in March of 2021, Hardy “stated in a Facebook page/group called ‘Peters Township Buzz News’ that Nello Construction was a ‘corrupt and incompetent construction company,’ in relation to Nello’s construction of the new Peters Township High School.” However, Nello failed to attach to its Complaint a verified copy of the allegedly libelous Facebook post. In light of this failure, Hardy filed a Preliminary Objection to Nello’s Complaint pursuant to Pa.R.Civ.P. 1019(i), which states, in part, that “[w]hen any claim or defense is based upon a writing, the pleader shall attach a copy of the writing, or the material part thereof.” The Trial Court sustained the Preliminary Objection and dismissed Nello’s Complaint. Nello then appealed.

Holding

The Superior Court affirmed the Trial Court’s Order. The Court found that the “rules and precedents make clear that failure to attach an essential writing to the complaint is fatal to the plaintiff’s case.” The Court further stated that just as a written contract is the essential document in a contract action, a libelous writing is an essential document in a libel action, such that it must be attached to the pleading pursuant to Pa.R.Civ.P. 1019(i).

Questions about this case can be directed to Danielle Vols at (570) 825-6890 or dvols@tthlaw.com.

Erie Ins. Exch. v. United Servs. Auto Ass’n
Pennsylvania Superior Court
2022 Pa. Super 207

Decided: December 6, 2022

Superior Court holds that there is no cause of action for negligent spoliation of evidence under the theory of promissory estoppel.

Background

A fire occurred at Bates Automobile Collision Repair shop, which damaged the shop and sixteen vehicles inside. The shop and several of the vehicles were insured by Plaintiff Erie Insurance. Erie Insurance paid claims for the fire damage to the shop and the owners of the vehicles it insured. Erie Insurance conducted an investigation of the fire and came to the preliminary opinion that the fire was caused by a BMW that was inside the shop for repair, which vehicle was in the possession of USAA. An initial inspection of the BMW was conducted. Afterward, Erie Insurance, through its counsel, sent a letter and email to USAA and its expert that confirmed that USAA would retain the BMW and have it “wrapped, secured and preserved for future examinations.” USAA acknowledged receipt of the letter and advised that it had requested Insurance Auto Auction (“IAA”), the entity that assumed storage of the BMW, to wrap and preserve the BMW for “potential additional investigation.” However, USAA failed to “sufficiently communicate” to IAA that the BMW was to be retained. Two months after the preliminary inspection, counsel for Erie contacted USAA to schedule an invasive inspection and learned that the BMW had been sold at a salvage auction.

Erie Insurance filed a cause of action against USAA for negligent spoliation of evidence under a theory of promissory estoppel. Erie Insurance sought damages for the money paid to its insureds for the fire loss and vehicles damaged in the fire. USAA answered that any damages for the inability of Erie Insurance to pursue its fire loss claim were too speculative and that there was no cause of action for negligent spoliation of the BMW. USAA also added the repair shop to the case, asserting that it was the way the shop handled the BMW, and not some defect in the BMW, which caused the initial fire. After discovery and submission of expert reports, both Erie and USAA filed Cross-Motions for summary judgment. The Lower Court ruled in favor of USAA, holding that Pennsylvania does not recognize a cause of action for negligent spoliation of evidence. It also found that Erie Insurance failed to satisfy the elements of promissory estoppel and that there was no subrogation right against USAA, as USAA did not cause the fire that resulted in the loss. Erie Insurance appealed claiming that the prohibition against filing a claim for negligent spoliation did not apply to a case brought under a theory of promissory estoppel and that it had met the elements to recover under such a theory.

Holding

The Superior Court affirmed the Lower Court’s entry of summary judgment in favor of USAA. Noting the Pennsylvania Supreme Court’s prior holding that “Pennsylvania law does not recognize a cause of action for negligent spoliation of evidence,” the Superior Court found that this pronouncement applies to all causes of action, regardless of the theory of liability. In doing so, the Superior Court found that, regardless of the theory of liability, public policy concerns existed as to the speculative nature of any damages claimed in cases of negligent spoliation. Equally, placing burdens on third parties to indefinitely preserve evidence also created public policy concerns. Thus, the Superior Court found that, even where claims are brought pursuant to a theory of promissory estoppel, there is no recognizable cause of action for negligent spoliation of evidence.

Questions about this case can be directed to Rebecca Sember-Izsak at (412) 926-1446 or rsember@tthlaw.com.

Lomuscio v. Cole
Pennsylvania Superior Court
No. 566 EDA 2022, 2022 Pa. Super. Unpub. LEXIS 2867

Decided: December 6, 2022

Partygoer was deemed to be invitee of tenants at college house party where fee was charged for attendance.

Background

Plaintiff, a 21-year-old male, attended a house party where he was attacked by suspected gang members. Attendees of the party were asked to pay $5 for the cost of beverages. Plaintiff filed suit against the out-of-possession owners of the house, along with several individuals who lived in the house. The Trial Court granted summary judgment in favor of various individuals who lived at the house. The Court found that because Plaintiff was a licensee, the individuals did not have a duty to protect him from third party criminal acts. The Trial Court also granted summary judgment as to the out-of-possession owners. Plaintiff appealed.

Holding

Viewing the evidence in the light most favorable to the Plaintiff, the Superior Court held that a jury could view the $5 charge as an admission fee, making the party open to members of the public, such that attendees (including Plaintiff) could be regarded as invitees, rather than licensees. In that same light, the Superior Court also held that there was evidence establishing the possibility for violence from third parties. As such, the Superior Court held that the individuals who lived at the house had a duty to warn or protect partygoers from the criminal acts of third parties, necessitating a reversal of the entry of summary judgment. The Superior Court did uphold the entry of summary judgment as to the property owners, as they were out-of-possession of the property and did not have any reason to believe that there would be acts of violence committed by third parties.

Questions about this case can be directed to Greg Kunkle at (610) 332-7015 or gkunkle@tthlaw.com, or to Brook Dirlam at (412) 926-1438 or bdirlam@tthlaw.com.

Waters v. Express Container Servs.
Pennsylvania Superior Court
No. 94 WDA 2022

Decided: October 18, 2022

Arbitration agreement was enforceable as Plaintiff’s personal injury claims occurred while he was performing work covered by the agreement.

Background

Plaintiff, a truck driver, suffered personal injuries on October 15, 2018, when he fell from the catwalk on the top of a tanker-trailer that he was inspecting at a trucking terminal in Pittsburgh. The trucking terminal was owned by Defendant, Express Container Services of Pittsburgh, LLC. At the time of the accident, Plaintiff was working on an assignment to transport the tanker-trailer for Defendant, Miller Transporters, under an Equipment Lease and Transportation Agreement that Plaintiff and Miller entered into on October 2, 2017. Plaintiff alleged that he was required by Miller and its customer to perform the inspection of the tanker-trailer before transporting it. The lease contained an arbitration agreement for any controversies arising out of or relating to the agreement.

Defendants filed Preliminary Objections asserting, inter alia, that the matter must be dismissed and ordered to arbitration pursuant to the agreement. Plaintiff opposed the Preliminary Objections, alleging that his personal injuries occurred outside the scope of the agreement, as the agreement was for a lease of a tractor, and not related to a trailer and/or inspections of same. The Trial Court overruled the Defendants’ Preliminary Objections. Defendants appealed to the Superior Court.

Holding

The arbitration agreement was held to be valid and enforceable, and Plaintiff’s conduct was determined to be within the scope of the agreement. The Superior Court found that Plaintiff was required to inspect the tanker by a customer of Miller and, therefore, the inspection was related to the purpose and scope of the agreement. As Plaintiff’s personal injury claims against Miller arose out of work that he was performing under the agreement, Plaintiff’s claims against Miller were within the scope of the arbitration clause and must be resolved by arbitration. The Superior Court overturned the Trial Court’s Order and remanded the case.

Questions about this case can be directed to Jonathan Danko at (717) 441-3957 or jdanko@tthlaw.com.

Venema v. Moser Builders, Inc.
Pennsylvania Superior Court
2022 Pa. Super. 171

Decided: October 4, 2022

Claims for defective construction of residence barred by Statute of Repose.

Background

Defendant, Moser Builders, Inc., constructed a home (“subject home”) in Chester Springs, Pennsylvania in 2003. A Certificate of Occupancy for the residence was issued on August 13, 2003, and the Plaintiffs herein purchased the subject home in October 2004. A Writ of Summons was filed by Plaintiffs on August 26, 2019. Thereafter, Plaintiffs filed their Complaint on March 10, 2020. Their Complaint alleged 13 counts concerning construction defects to the subject home. Plaintiffs alleged that Defendant performed numerous inspections and repairs to the subject home from 2004 to 2008 and these repairs failed to remedy defects which caused significant water infiltration, resulting in damages.

Defendant filed a Motion for judgment on the pleadings on October 19, 2020. Defendant cited 42 Pa.C.S. § 5536(a), which states that “a civil action or proceeding brought against any person lawfully performing or furnishing the design, planning, supervision or observation of construction, or construction of any improvement to real property must be commenced within 12 years after completion of construction.” Defendant asserted that Plaintiffs’ Complaint was time-barred by the Statute of Repose, as over 12 years had passed from completion of construction of the subject home. Plaintiffs argued that the Defendant’s numerous repairs between 2004 and 2008 delayed the date of completion for purposes of calculating the 12-year Statute of Repose.

Holding

The Superior Court’s only inquiry was whether 12 years had elapsed between Defendant’s completion of the subject home and the date Plaintiffs asserted damages. In doing so, the Court reasoned that a residence may not be used, and is therefore not completed, until a Certificate of Occupancy is issued. Furthermore, Plaintiffs offered no authority to support their contention that Defendant’s repairs through 2004 to 2008 delayed the completion date. Rather, the Superior Court relied upon Supreme Court precedent, which states that the Statute of Repose may not be tolled even in cases of extraordinary circumstances beyond a plaintiff’s control.

The Superior Court held that, regardless of any repairs Defendant may have done once the residence was legally occupied, the occupants would have been exposed to the alleged defect in 2003, upon issuance of the Certificate of Occupancy, and residency in the subject home in 2004. Therefore, the Statute of Repose period would have continued to run, without interruption, from that point forward.

Questions about this case can be directed to Cameron Kockler at (412) 926-1428 or ckockler@tthlaw.com.

Bolden-Johnson v. Agate Constr. Co.
Pennsylvania Superior Court
No. 2249 EDA 2021

Decided: September 30, 2022

Establishment of statutory employer tort immunity of general contractor bars indemnification from subcontractor in bench trial.

Background

John Johnson, as an employee of Atlantic Concrete Cutting, Inc. (“Atlantic”), died while performing demolition work on Pier 78 in Philadelphia, PA. Johnson’s wife filed suit against Agate Construction Company, Inc. (“Agate”), the general contractor for the project, among others, to recover damages for her husband’s death. Agate, based on a clause contained in its subcontract with Atlantic, joined Atlantic, demanding indemnification. Agate later filed a Motion for summary judgment arguing that it was the “statutory employer” of Mr. Johnson and immune from suit pursuant to Pennsylvania’s Workers’ Compensation Act. Under the Workers’ Compensation Act, an employer is immune from tort liability for an employee’s personal injury if it meets five elements qualifying it as a “statutory employer.” The five elements are: (1) an employer who is under contract with an owner or one in the position of an owner; (2) premises occupied by or under the control of such employer; (3) a subcontract made by such employer; (4) part of the employer’s regular business is entrusted to such subcontractor; and (5) the employee of the subcontractor is injured. While Atlantic did not oppose the Motion, Johnson did. When the Trial Court denied summary judgment based on a remaining issue of material fact as to the entity that owned the pier, Agate settled with Johnson for $10.5 million. Agate then pursued its indemnification claim against Atlantic.

During the bench trial on the indemnification clause, and after the close of Agate’s case, Atlantic moved for a compulsory nonsuit, which was granted. In its 1925(a) Opinion, the Trial Court reasoned that to establish a claim for indemnification, Agate had the burden to prove the validity of the underlying claim, since the underlying action was settled rather than resolved by payment of a judgment. The Trial Court analyzed that a valid claim could not be established against Agate because the record contained uncontested evidence that Agate met all five elements of the statutory employer defense, including being the owner of the pier, which had been unresolved during the summary judgment phase. Given that Agate established that it was Mr. Johnson’s statutory employer, it was immune from tort liability, and the underlying claim against Agate was invalid.

Holding

The Superior Court affirmed the nonsuit, holding that the Trial Court properly found evidence that satisfied all elements for statutory employer immunity. The Court reiterated a statement it made in a preceding matter that a party entering into a settlement “assumes the risk, in an action against the wrongdoer for indemnity, of being able to prove the actionable facts on which his liability depends.”

Questions about this case can be directed to Julia Morrison at (717) 441-7056 or jmorrison@tthlaw.com.