Appeal from the Order of February 5, 1976 of the Court of Common Pleas of Crawford County, Pa., Civil Div. at No. 157 May Term, 1974.
Henry J. Rea, Jr., Pittsburgh, for appellants.
R. Charles Thomas, Meadville, with him Bozic, Thomas & Johnson, Meadville, for appellee.
Jacobs, Hoffman, Cercone, Price, Van der Voort and Spaeth, JJ. Hoffman and Cercone, JJ., concur in the result. Van der Voort, J., notes his dissent. Watkins, Presiding Judge, absent.
[ 247 Pa. Super. Page 536]
This is an appeal from an order granting a motion for summary judgment. The motion was filed by an insurance company, resisting a claim by its insured.
It is established that "[t]he utmost fair dealing should characterize the transactions between an insurance company and the insured." Fedas v. Insurance Company of the State of Pennsylvania, 300 Pa. 555, 559, 151 A. 285, 286 (1930). It is also established that a motion for summary judgment should be granted only in the clearest of cases, which is to say, only when there is no materia issue of fact and no doubt about what the result should be. See Just v. Sons of Italy Hall, 240 Pa. Super. 416, 368 A.2d 308 (filed April 22, 1976) (collecting cases). Here, whether there was the utmost fair dealing is by no means clear. The order of the lower court should therefore be reversed and the case remanded for further proceedings.
[ 247 Pa. Super. Page 537]
On December 4, 1967,*fn1 appellants purchased from appellee a fire insurance policy that covered appellants' home, appurtenant private structures, and unscheduled personal property, and provided reimbursement of such additional living expenses as might result from a fire. The policy contained the following provision:
No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within twelve months next after inception of the loss.
This is a standard provision required by statute. Act of May 17, 1921, P.L. 682, 40 P.S. § 636.
On April 9, 1968, while appellants were in Florida, their home, garage, and furniture were destroyed by a fire. On July 22, 1968, appellants filed a sworn proof of loss with appellee, claiming $20,000 for the loss of their home, $250 for the loss of their garage, $8,000 for the loss of their furniture, and $4,000 for additional living expenses.
On September 17, 1968,*fn2 after an investigation by one of its claims adjusters, appellee rejected appellants' proof of loss and refused to pay their claim.
Also on September 17, 1968, the District Attorney of Crawford County filed a criminal complaint against appellant William Diamon, charging him with filing a false proof of loss; it was alleged that appellant had removed the furniture from his home before the fire.
On January 28, 1969, appellant was indicted for attempted cheating by false pretenses, and on February 11, 1969, a jury
[ 247 Pa. Super. Page 538]
found him guilty of the charge. This was a miscarriage of justice, as became apparent when, later in February, appellant secured a bulldozer and dug up rubble at the site of his former home, uncovering pieces of the furniture for the loss of which he had made claim in his proof of loss. On the basis of this after-discovered evidence the trial court on March 2, 1970, granted appellant a new trial, and on December 21, 1970, the District Attorney asked and was granted leave to enter a nolle prosequi.
On April 5, 1974, appellants filed a complaint in assumpsit to recover $32,250 from appellee ($20,000 for their home, $250 for their garage, $8,000 for their furniture, and $4,000 for additional living expenses). By answer and new matter appellee alleged that appellants had "failed . . . to comply with the provisions of the policy that suit be commenced within twelve (12) months next after inception of the loss . . . ." This allegation was the basis of appellee's motion for summary judgment, which was filed on January 31, 1975. Affidavits in support of and against the motion were filed, and on February 5, 1976, the lower court granted the motion.
In its opinion explaining why it had granted the motion the lower court accurately summarized the issues raised by appellants:
(a) The Company waived the twelve months suit requirement by action of its agent in causing criminal charges to be filed by the county detective.
(b) This conduct caused a complete waiver -- not a post-ponement of the twelve month requirement and thus the Diamons could bring suit any time within the general six year statute of limitation period applicable to assumpsit action.
-- or in the alternative --
(c) Even though the criminal charge against William J. Diamon was "nolle prossed" by the District Attorney, he was "forced by the circumstances" to wait out the five years statute of limitation applicable to the criminal charge before he brought suit against the Company.
[ 247 Pa. Super. Page 539]
Diamon's argument is that he could still be reprosecuted on the same charge until July 22, 1973, and if he filed civil action under the policy, he ran the risk of Company retaliation by the refiling of the criminal charge. Diamon argues that once the five year statute had run out on the criminal charge, he had an additional twelve months from the date to file his claim and did so eight months and thirteen days later on April 4, 1974.
Slip Opinion at 3-4 (emphasis in original).
The terms "waiver" and "estoppel" have come to have their own special meaning in the context of insurance law.*fn3 In O'Connor v. Allemania Fire Insurance Company, 128 Pa. Super. 336, 339-40, 194 A. 217, 218-19 (1937), this court noted:
Some confusion has resulted from a careless and, perhaps, not wholly accurate use in the decisions of the words "waive" and "waiver" in connection with the clause in the policy limiting the time within which an action may be brought upon it, when what was really meant was such conduct on the part of the insurer or its authorized representatives as to excuse the insured from strict compliance with the terms of the policy and to extend the period for bringing suit. . . . Undoubtedly there may be an express waiver of the limitation of suit clause in the policy, and when there is such a definite waiver, it is no longer in force and thereafter the statutory limitation as to contracts applies; but our Supreme Court has ruled that when the insured seeks to excuse his failure to bring suit within the period of time fixed in the policy by conduct of the insurer which misled the insured to his injury -- the failure of the insured to bring suit within the prescribed time being due to the insurer's act or conduct --, the limitation has not been fully and completely
[ 247 Pa. Super. Page 540]
belonging to the insured was partially destroyed by fire. After filing his claim and proof of loss, the insured and the insurer's adjuster entered into settlement negotiations. A disagreement as to the amount of the loss lead to the appointment of appraisers on April 15, 1898, as provided by the policy. On January 18, 1900, the insured brought an action in assumpsit to recover his loss, alleging that within the last sixty days the appraisers had abandoned the appraisement. In reversing the non-suit entered for the insurer the Supreme Court stated:
The company having required an appraisement by reason of its inability to agree with the insured as to the amount of the loss must be regarded as having waived its right to enforce the limitation clause until the appraisers have made an award or the appraisement has been abandoned, unless the award has been delayed or the appraisement has been abandoned by reason of the conduct of the insured. When the appraisement has been terminated, either by an ...