Appeal from the Order entered September 7, 2012, Court of Common Pleas, Allegheny County, Civil Division at No. GD 10-012335
The opinion of the court was delivered by: Donohue, J.:
BEFORE: BOWES, DONOHUE and MUNDY, JJ.
Appellant, Brian Lynn ("Lynn"), appeals from the trial court's grant of summary judgment in favor of Appellee, Nationwide Insurance Company ("Nationwide"). This case presents an issue of first impression, specifically an interpretation of the anti-abuse provisions of the Unfair Insurance Practices Act ("UIPA"), 40 P.S. § 1171.5(a)(14), including in particular subsection 1171.5(a)(14)(i)(D), added in 2006. For the reasons that follow, we conclude that the trial court's interpretation of this provision of the UIPA was flawed, and accordingly we reverse the order granting summary judgment.*fn1
The parties do not dispute the basic factual and procedural background of the case. On October 27, 2009, Lynn's estranged wife, Terra Lynn ("Terra"), telephoned the Warren Carr Insurance Agency (the "Carr Agency"), the insurance agency providing homeowners insurance on the marital residence, and informed Warren Carr, its principal, that she wanted to cancel the homeowners policy (the "Policy") covering the home. The next day, Bonita Rush, the agency's office manager, called Terra and advised her that a written confirmation would be required to cancel the Policy. On October 30, 2009, Terra sent an email from the address of email@example.com, stating, "I want my homeowners policy cancelled. Sincerely, Brian Lynn." The parties do not dispute that this email address was created by Terra and that she sent this email without Lynn's knowledge or assent.
On November 1, 2009, Terra drugged the couple's children and attempted to burn down the marital residence with her and the children inside. She left a suicide note to Lynn stating, "Have a great fucking life knowing the kids will always be with me now. I leave you absolutely nothing." Luckily, her murder-suicide attempt was foiled and she and the children escaped serious injuries. Terra was arrested and subsequently pled guilty to criminal charges, including arson. Lynn now has custody of their children.
On or about November 3, 2009, Lynn went to the Carr Agency to inquire regarding insurance coverage for damage to the marital home and its contents. At that time, Lynn was informed that the Policy had been cancelled. On November 10, 2009, the mortgagee of the premises filed a claim for damages with Nationwide, and six days later Lynn filed his own claim. Lynn began preparation of an inventory of items in the home at the time of the fire. Lynn and Nationwide disagree as to whether, and/or the extent to which, this inventory contains items not damaged in the fire or not in the home at the time of the fire.
Based upon the purported cancellation of the Policy, Nationwide denied Lynn's claim. On June 30, 2010, Lynn filed a lawsuit against Nationwide (and Terra) in which he alleges that Nationwide breached the terms of the homeowners' policy and did so in bad faith. After discovery, Nationwide filed a motion for summary judgment contending, inter alia, that the Policy was properly cancelled in accordance with its terms, that all claims were excluded from coverage under the intentional acts provision in the Policy, and that Lynn's inventory violated the concealment and fraud provisions of the Policy. Lynn filed a response to Nationwide's motion for summary judgment, denying its material contentions. In particular, Lynn argued that subsection 1171.5(a)(14)(i)(D) of the UIPA precludes the entry of summary judgment in this case. Subsection 1171.5(a)(14)(i)(D) prohibits an insurance company from "refusing to pay an insured for loses arising out of abuse to that insured under a property ... insurance policy or contract ... if the loss is caused by the intentional act of another insured...." 40 P.S. § 1171.5(a)(14)(i)(D).
On September 7, 2012, the trial court issued a memorandum and order granting Nationwide's motion for summary judgment with respect to the first two counts of Lynn's complaint.*fn2 The text of the trial court's memorandum reads as follows:
Pending before me is [Nationwide's] Motion for Summary Judgment, which seeks the dismissal of the breach of contract and bad faith counts of the Complaint. The Complaint was filed after Nationwide denied [Lynn's] claim for insurance benefits following a fire intentionally set by his wife. [Lynn] appears to concede the intentional acts exclusion in the [Policy] would apply, but for the [UIPA]. Specifically, [Lynn] relies on section 1171.5(a)(14)(i), which prohibits an insurance company from denying a claim such as his 'because the insured ... is a victim of abuse ... .'
(Emphasis added). [Lynn], who argues his wife set the fire as part of a pattern of abuse directed at him, interprets the word 'because' in paragraph (14)(i) to mean 'if,' when it actually should be interpreted to mean 'for the reason that.' This becomes apparent upon reading subparagraphs 14(ii)(B) and 14(iii).
The former provides that nothing in paragraph 14 'shall be construed as ... requiring [an insurance company] to provide benefits or coverage for losses incurred solely because the insured ... is a victim of abuse.' The latter provides that an insurance company does not violate paragraph 14 'if any action taken is permissible by law and applies to the same extent to all ... insured without regard to whether an ... insured is a victim of abuse.' Thus, the Act prohibits discriminating against a benefits claimant on the basis that the claimant was a victim of abuse as defined by the Act. Because [Lynn] does not even allege such discrimination, I enter the follow [order granting summary judgment].
Trial Court Memorandum, 9/7/12, at 1-2 (emphasis in original). Because the trial court's order did not dispose of Lynn's claims against Terra, it was not a final order for purposes of appeal. Pa.R.A.P. 341(c). Lynn filed a motion pursuant to Pa.R.A.P. 341(c), requesting that the trial court amend its order to designate it as a final order because an immediate appeal would facilitate final resolution of the entire case. On September 14, 2012, the trial court amended its order as requested, and this appeal followed.
On appeal, Lynn raises the following issues for our consideration and determination:
1. Where the record shows a pattern of abuse,
including unauthorized purported policy cancellation through forged communications and an attempt to kill the victim's children and spouse by the spouse deliberately setting fire to the insured property with them in it, can an [i]nsurer properly deny the innocent victim spouse's claim for recovery of property damage consistent with the provisions of [UIPA], and specifically 40 P.S. § 1171.5(a)(14)(i)(D).
2. Is an attempt to cancel a policy effective when it is part of a pattern of abuse, not authorized by the abused insured victim, based on a forged communication to the [i]nsurer and contrary to the policy provisions concerning cancellation by the insured.
3. Where an [i]nsurer denies the claim of an innocent victim of abuse in violation of the provisions of the UIPA, and, in addition, supports its denial based on a forged and inadequate communication to the insurance agent, are material issues of fact presented precluding the award of summary judgment in favor of the [i]nsurer on its bad faith claim.
4. Are there material facts at issue so as to preclude summary judgment regarding whether [Lynn]
intentionally concealed or misrepresented facts to Nationwide regarding his contents claim so as to preclude coverage.
5. Are there material facts at issue, so as to preclude summary judgment regarding whether personal property claimed was abandoned by the insured.
Our standard of review when considered an appeal from the grant of summary judgment is as follows:
As has been oft declared by this Court, 'summary judgment is appropriate only in those cases where the record clearly demonstrates that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law.' Atcovitz v. Gulph Mills Tennis Club, Inc., 571 Pa. 580, 812 A.2d 1218, 1221 (2002); Pa.R.C.P. No. 1035.2(1). When considering a motion for summary judgment, the trial court must take all facts of record and reasonable inferences therefrom in a light most favorable to the non-moving party. Toy v. Metropolitan Life Ins. Co., 593 Pa. 20, 928 A.2d 186, 195 (2007). In so doing, the trial court must resolve all doubts as to the existence of a genuine issue of material fact against the moving party, and, thus, may only grant summary judgment 'where the right to such judgment is clear and free from all doubt.' Id. On appellate review, then, an appellate court may reverse a grant of summary judgment if there has been an error of law or an abuse of discretion. But the issue as to whether there are no genuine issues as to any material fact presents a question of law, and therefore, on that question our standard of review is de novo. This means we need not defer to the determinations made by the lower tribunals.
Weaver v. Lancaster Newspapers, Inc., 592 Pa. 458, 926 A.2d 899, 902-03 (2007) (internal citations omitted). To the extent that this Court must resolve a question of law, we shall review the grant of summary ...