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Cruz v. Princeton Insurance Co.

March 24, 2009


Appeal from the Orders Dated October 18, 2004 In the Court of Common Pleas, Civil Division Philadelphia County, No. 000415 March Term 2003.

The opinion of the court was delivered by: Bender, J.



¶ 1 This matter comes before us on remand from the Supreme Court of Pennsylvania for consideration of whether plaintiffs Jacqueline Nieves Cruz and Oscar Cruz (the Cruzes) adduced evidence sufficient to raise a question of material fact concerning the harm element of their claim for Abuse of Process. The Cruzes argue, and we conclude, that the evidence, both direct and circumstantial, does raise such a question. Accordingly, we reverse the order granting summary judgment and remand this matter to the trial court for further proceedings on the Cruzes' action.

¶ 2 The Cruzes commenced this action for abuse of process*fn2 following Princeton Insurance Company's filing of a petition for appointment of a guardian ad litem that sought to supersede the Cruzes' authority as parents to negotiate a post-trial settlement offer that Princeton made on behalf of its insured, Northeastern Hospital. Defendants Alan S. Gold and Gold, Butkovitz & Robins, P.C., represented Princeton in that process.

¶ 3 In the underlying litigation, reviewed by this Court in Cruz v. Northeastern Hosp., 801 A.2d 602 (Pa. Super. 2002), the Cruzes secured a $15,000,000 judgment in favor of their son, Adam Omar Cruz, for injuries he sustained during birth. During our review of this case prior to remand we related the history of the Cruz case as it relates to the litigation now before us. We repeat that history here:

In 1994, Appellants, individually and on behalf of their son, Adam, filed a medical malpractice action against Northeastern Hospital, Dr. Myung Hyo Shin, and Dr. Robert Cogan, seeking

"Abuse of process" is defined as "the use of legal process against another primarily to accomplish a purpose for which it is not designed." Shiner [v. Moriarty], 706 A.2d at 1236 (quoting Rosen v. American Bank of Rolla, 426 Pa.Super. 376, 627 A.2d 190, 192 (1993)).

To establish a claim for abuse of process it must be shown that the defendant (1) used a legal process against the plaintiff, (2) primarily to accomplish a purpose for which the process was not designed; and (3) harm has been caused to the plaintiff.

Id. Abuse of process is, in essence, the use of legal process as a tactical weapon to coerce a desired result that is not the legitimate object of the process. McGee v. Feege, 517 Pa. 247, 259, 535 A.2d 1020, 1026 (1987). Thus, the gravamen of this tort is the perversion of legal process to benefit someone in achieving a purpose which is not an authorized goal of the procedure in question. damages for permanent and debilitating injuries Adam sustained when he was born on August 14, 1992. Appellants dropped their individual claims and, in August 2000, a jury returned a verdict in favor of Adam and against the hospital in the amount of $10,811,431.27.FN1 Following Appellants' motion for delay damages, the verdict was molded to over $15,000,000. The hospital and Appellants cross-appealed.

FN1. The jury found in favor of the physician defendants. Princeton, the hospital's insurer, retained Attorney Gold of GBR to handle the appeal and related settlement negotiations. While the appeal was pending before this Court,FN2 the parties began settlement negotiations before a mediator selected by Princeton. This mediator suggested a settlement in the range of $8 to $10 million. Settlement discussions continued through February 2002, but Appellants rejected Princeton's offer to settle the case for $7,000,000.

FN2. On April 17, 2002, this Court affirmed the judgment entered in favor of Appellants. Cruz v. Northeastern Hospital, 801 A.2d 602 (Pa. Super. 2002).

On February 27, 2002, on behalf of his client, Attorney Gold petitioned the court to appoint a guardian ad litem for Adam. The petition alleged in pertinent part:

6. Princeton and the Cruzes have engaged in excessive settlement negotiations with the aid of Abraham Gafni, former judge of the Court of Common Pleas of Philadelphia County as a mediator. The parties have reached an impasse in those negotiations. Princeton Insurance Co. has offered $7,000,000 to the Cruzes. This constitutes sufficient money to support [Adam] for the rest of his life. This money has been turned down.

7. Princeton Insurance Co. believes that a substantial possibility exists that Northeastern Hospital will prevail on the appeal and that the Cruzes may receive no money for [Adam].

8. [Adam's] medical expenses would then become a burden on the taxpayers of this Commonwealth.

9. [Adam] would not have the opportunity to have the full services that he would if his parents accepted the $7,000,000.

10. Princeton Insurance Co. respectfully requests that this Court appoint a guardian ad litem to evaluate the settlement demand and to represent the interest of [Adam] in this litigation.

11. Princeton believes that the parents have had a substantial disagreement among themselves concerning how to handle this litigation and whether to accept the settlement offer of Princeton Insurance Co. made on behalf of Northeastern Hospital.

12. Further, a potential conflict of interest exists between plaintiffs' counsel and the interests of her minor client, [Adam], particularly in light of disagreement among his parents with respect to the settlement offer.

13. The appointment of a guardian ad litem will insure that the interest of the child will be protected. The guardian ad litem would pursue the litigation on behalf of [Adam] and evaluate settlement offers.

Petition for Appointment of Guardian Ad Litem For Adam Cruz[.] The trial court denied the petition on March 7, 2002, and, shortly thereafter, Appellants accepted in principle Princeton's settlement offer of $7,100,000. This offer was ultimately approved by the trial court on September 5, 2002.

On May 22, 2003, Appellants filed a complaint in the instant action for abuse of process against Appellees alleging that, by improperly filing the petition for appointment of a guardian ad litem, Appellees caused them "extreme emotional distress, fear, upset and anxiety that their parental rights could be terminated" and that they "became so fearful of subsequent assaults on their parental rights that they agreed to the settlement offer of $7,000,000 rather than to continue with negotiations." Complaint, 5/22/03, at 5. On this latter contention, Appellants have since dropped any damages claim that, as a result of the filing of the guardianship petition, they were coerced into prematurely settling the case.FN3

FN3. At en banc oral argument in this matter, Appellants' counsel confirmed that Appellants were no longer seeking damages related to any coercion to settle the case.

Appellees filed separate motions for summary judgment, which the trial court granted in separate orders on October 18, 2004. Appellants' motion for reconsideration was denied, and this timely appeal followed.

Cruz v. Princeton Ins. Co., 925 A.2d 853, 854-856 (Pa. Super. 2007).

¶ 4 Following oral argument, a panel of this Court found that the trial court had erred in granting summary judgment, reasoning that the evidence adduced in discovery raised an issue of material fact concerning the extent to which Princeton and its counsel commenced the guardianship action for the improper purpose of forcing the Cruzes to settle the underlying malpractice litigation for less than the amount of the outstanding judgment. See Cruz v. Princeton Ins. Co., 3191 EDA 2004, 3192 EDA 2004 (Pa. Super. March 14, 2006) (withdrawn). Subsequently, however, this Court granted reconsideration en banc and, following Reargument, a Majority of the en banc panel rejected the rationale of the original merits panel, concluding that the evidence did not raise a question of material fact concerning the propriety of Princeton's use of the guardianship action. Judge Orie Melvin filed a Concurring Opinion agreeing with the Majority's affirmance of the trial court's order, but suggesting that regardless of the propriety of Princeton's motives, the evidence failed to establish a question of material fact concerning whether the Cruzes had sustained emotional harm as a result of the filing of the guardianship action. Id. at 12 (Orie Melvin, J. concurring). Judge (now Justice) Todd dissented, reasoning that the evidence raised questions of material fact concerning both of the disputed elements of the abuse of process claim and asserted that, consequently, the trial court's order should be reversed and the case remanded for a trial on the issues. Id. at 17 (Todd, J. dissenting).

¶ 5 We rendered our decision on May 30, 2007, following which the Cruzes sought allowance of appeal to the Supreme Court of Pennsylvania. Upon review, the Supreme Court reversed our decision, per curiam, by way of the following order:

AND NOW, this 29th day of May 2008, the Petition for Allowance of Appeal is GRANTED and the Superior Court's decision is REVERSED in part to the extent it holds that there was no genuine issue of material fact regarding whether the use of the process was primarily used for a purpose for which it was not designed. See Wimer v. Pa. Emp. Benefit Trust Fund, 939 A.2d 843 (Pa. 2007); see also McNeil v. Jordan, 894 A.2d 1260 (Pa. 2006). Further, this matter is REMANDED to the Superior Court for consideration of the harm element of McNeil, 894 A.2d at 1275.

Madame Justice Todd did not participate in the consideration or decision of the matter.

Per Curiam Order, 5/29/08 at 1.

¶ 6 Although issued without Opinion, the Supreme Court's order clearly responds to our prior en banc Opinion, invalidating its conclusion and establishing the law of this case. See Gateway Towers Condo. Ass'n v. Krohn, 845 A.2d 855 (Pa. Super. 2003). Consequently, our review may extend only to consideration of whether the evidence of record establishes a genuine issue of material fact surrounding the Cruzes' claim that they sustained harm as a result of Princeton's effort to impose a guardian ad litem.*fn3 Gold, asserting that the evidence does not raise such a question, suggests that the Cruzes sustained only a "transient rub of life," an injury "[not] serious enough to warrant compensation, although there may be some pain attached." Brief for Appellees Gold, et al., on Remand at 3 (quoting Van Kirk v. O'Toole, 857 A.2d 183, 185-86 (Pa. Super. 1994) (quoting Boggavarapu v. Ponist, 542 A.2d 516, 518 (Pa. Super. 1988)). To support this conclusion, Gold cites testimony taken at the depositions of Jacqueline and Oscar Cruz in which the plaintiffs described their mental state upon learning of the guardianship petition as "upset" or "angry," without elaboration of accompanying physical manifestations

ΒΆ 7 Gold relies, in addition, upon our decisions enunciating the restrictive "impact rule" in intentional or negligent infliction of emotional distress cases, which limits actionable grounds to instances in where the plaintiff's emotional harm resulted from a physical impact to his or her person. Brief for Appellees Gold, et al. on Remand, at 4 (citing, inter alia, Simmons v. PACOR, Inc., 674 A.2d 232, 2348 (Pa. 1996); Brown v. Philadelphia Coll. of Osteopathic Med., 760 A.2d 863, 868 (Pa. Super. 2000); Doe v. Philadelphia Cmty. Health Alternatives AIDS Task Force, 745 A.2d 25, 28 (Pa. Super. 2000); Fewell v. Besner, 664 A.2d 577, 581-82 (Pa. Super. 1995); Gregorio v. Zeluck, 678 A.2d 810, 814-15 (Pa. Super. 1996)). Inasmuch as the evidence here fails to establish any impact whatsoever, Gold asserts that we should find no question of material fact concerning the harm element of the Cruzes' claim and should, consequently, affirm the trial ...

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