Print Friendly, PDF & Email

The insured’s representatives sued the insured’s carrier and its claims adjuster for bad faith. The complaint alleged bad faith in claims handling and in refusing to defend the insured.

The claims adjuster, though the carrier, brought a Dragonetti action against the insured’s representative and her counsel for bringing the bad faith claim against the adjuster. The court described it as a wrongful use of civil proceedings claim. The trial court dismissed the wrongful use claim on preliminary objections, and the matter was on appeal in the Superior Court.

First, the appellate court found that the insurer/adjuster waived all issues on appeal regarding dismissal of the Dragonetti action.

Next, even if not waived, the Superior Court ruled dismissal was proper.

The trial court found that because the allegations against the adjuster were based on the adjuster’s conduct as a claims handler, and not as a private citizen, the wrongful use claim should be dismissed. The Superior Court agreed under these circumstances that “it was not unreasonable … to name the insurance claims adjuster who denied [the] claims for coverage.”

[Note: The court apparently was not faced with the issue that a statutory bad faith claim against an adjuster must be dismissed in the first instance because the bad faith statute does not apply to adjusters, only insurers themselves. For example, see Judge Savage’s opinion in Reto, Judge Nealon’s opinion in Fertig, Judge Surrick’s opinion in Kofsky, and Judge Bartle’s decision in the 2013 Feingold case.]

Date of Decision: February 28, 2020

Philadelphia Contributionship Ins. Co. v. Kiely, Superior Court of Pennsylvania No. 3111 EDA 2018, 2020 Pa. Super. Unpub. LEXIS 725 (Pa. Super. Ct. Feb. 28, 2020) (Colins, Panella, Strassburger, JJ.)