In Bruno v. Erie Insurance Company, the Supreme Court affirmed the existence of the “gist of the action” doctrine. Rather than viewing this as a recent theory, initiated with the Superior Court’s 1992 Bash v. Bell Telephone Company of PA decision, the Supreme Court concluded that the gist of the action doctrine had been part of its jurisprudence since 1830.
The basic formulation is that the nature of the duty alleged to have been breached is the critical factor in determining if the case is deemed a breach of contract action or a tort action. The courts should look at the substance of a party’s allegations, and not labels affixed to pleadings, in making that determination. To the extent that the Superior Court added an intertwining rule, i.e., if the two claims are intertwined the doctrine applies, there is no separate intertwining rule, but only the basic rule, which is:
“If the facts of a particular claim establish that the duty breached is one created by the parties by the terms of their contract – i.e., a specific promise to do something that a party would not ordinarily have been obligated to do but for the existence of a contract – then the claim is to be viewed as one for breach of contract. … If, however, the facts establish that the claim involves the defendant’s violation of a broader social duty owed to all individuals, which is imposed by the law of torts and, hence, exists regardless of the contract, then it must be regarded as a tort.” |
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