The insured demanded uninsured motorist benefits, but failed to plead the identity of the tortfeasor driver or whether that driver was in fact uninsured. The court found there was sufficient information from which the insured could have made this determination and included it in the complaint. Thus, it granted the insurer’s motion to dismiss a breach of contract UM claim, but with leave to amend to add the tortfeasor driver and whether that driver was in fact uninsured.
As to the bad faith count, the court first observed there has to be some predicate claim against the insurance policy, even if the bad faith claim is a distinct claim, i.e., “there must be a predicate contract claim in order for a section 8371 claim to proceed.” Thus, “’[w]hile the predicate claim need not be tried together with the section 8371 claim, the predicate cause of action “must be ripe for a § 8371 claim to be recognized.’” Further, in Ash v. Continental Insurance Company, Pennsylvania’s Supreme Court “recognized this requirement … holding that section 8371 ‘applies only in limited circumstances—i.e., where the insured has first filed ‘an action arising under an insurance policy’ against his insurer[.]’”
In this case, the court’s dismissing the breach of contract claim “removes the predicate cause of action otherwise required to accompany the section 8371 claim.” The court cites Eastern District Judge Davis’ 2011 decision in MP III Holdings, summarized here, for the principle that “a bad faith claim in a vacuum is not actionable.”
[Note: This is consistent with the position, mentioned many times on this Blog, that statutory bad faith only exists when a benefit has been denied, and not merely for poor claims handling where no benefit is due.]
Thus, the bad faith claim was also dismissed without prejudice, in light of the court’s giving plaintiff an opportunity to re-plead the breach of contract claim.
Date of Decision: March 30, 2022
NYE v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, U.S. District Court Middle District Pennsylvania No. 3:21-CV-01029, 2022 WL 969620 (M.D. Pa. Mar. 30, 2022) (Wilson, J.)