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Souder v. Travelers

United States District Court, M.D. Pennsylvania

July 5, 2017

TRAVELERS, et al., Defendants.


          KAROLINE MEHALCHICK United States Magistrate Judge

         Before the Court is a partial motion for summary judgment, filed on December 15, 2016 by Defendant Travelers Home and Marine Insurance Company (“Travelers H&M”). (Doc. 45). In its brief in support, Travelers H&M argues that Count IV of the complaint filed by Plaintiff Pamela Souder (“Souder”), wherein Souder seeks damages under Pennsylvania's bad faith provisions (Doc. 1-1, at 11), should be dismissed. (Doc. 46). For the reasons stated below, Defendant's motion is GRANTED. Count IV of the complaint (Doc. 1-1) is DISMISSED.

         I. Background and Procedural History

         On June 9, 2014, agents of the Defendants inspected the home of the Plaintiff, Pamela Souder, to investigate damage that Souder alleges occurred as a result of snow buildup during February of 2014. (Doc. 56, ¶¶ 8-9). Souder, who filed a notice of claim with the Defendants on June 5, 2014, states that she noticed bowing in her roof as a result of the weight of the snow, with damage first materializing in bubbling and cracking of the paint and drywall. This led her to call in a contractor shortly after the snowfall, who assessed the weight of the snow as the cause of the cracking. (Doc. 56-23, at 4). Souder conveyed this to Travelers in her notice of claim. (Doc. 56-3, at 9). Accordingly, Travelers classified the type of loss as “Weight of Ice and Snow.” (Doc. 45-2, ¶ 6).

         At the inspection, claim professional Katherine Prudhoe observed water damages to the drywall in the home's ceiling.[1] (Doc. 45-5, at 4). The same day, the type of loss was amended from “Weight of Ice and Snow” to water damage to the drywall from an ice damming event, although the parties dispute whether this change occurred prior or subsequent to Prudhoe's investigation. (Doc. 45-2, ¶ 11; Doc. 56-23, ¶ 11). As a result of the inspection, Travelers wrote a check to Souder for $1, 287.07, reflecting the estimate for the damage, less Souder's $500 deductible. (Doc. 45-2, ¶ 14). Repairs were completed the same month. (Doc. 45-2, ¶ 16).

         In October 2014, Souder noticed further damage to the ceiling and contacted Travelers again. (Doc. 45-2, ¶ 16). Travelers again conducted an inspection, this time with independent structural engineering consultant Dave Stakem. (Doc. 45-2, ¶ 17). During the inspection, Stakem, with permission, cut a hole in Souder's roof to inspect the supports and photographed their condition. (Doc. 45-2, ¶ 19). Following the inspection, Stakem issued an opinion stating the roof is lightly framed, normal for the age of the home;[2] the attic is not properly vented, causing heat and moisture buildup contributing to bowing; and that the sag in the roof is not attributable to recent structural movements caused by the weight of snow and ice. (Doc. 45-9, at 4). Stakem further took note of the cracking drywall, attributing the cracks to seasonal shifts in the climate. (Doc. 45-9, at 3).

         Travelers reviewed Stakem's findings with Souder. (Doc. 45-2, ¶ 22). In early December, Souder expressed disagreement with the factual findings, as well as indicated dissatisfaction with the June investigation by Travelers, which Souder claims was insufficient and contributed to the damage uncovered later. (Doc. 45-2, ¶ 23; Doc. 56-23, ¶ 23). The parties arranged for a second inspection to take place, again conducted by Stakem and in the presence of Souder's unit manager, Thomas Palmer.

         On December 11, 2014, the second inspection occurred with Souder joined by Palmer, Stakem, Prudhoe, and Travelers' adjuster Richard Scimeca. (Doc. 45-2, ¶ 27). Travelers' notes state that Stakem explained that the damage was not attributable to ice and snow, nor was the home unsafe for habitation. (Doc. 45-5, at 10). Travelers again cut a hole in the roof in order to allow for closer inspection, writing a check to Souder for repairs to the roof. (Doc. 45-2, ¶ 29). Stakem renewed his findings from the November inspection. (Doc. 45-10).

         On January 27, 2015, Travelers sent a letter to Souder explaining their decision to deny her claim, referencing the second Stakem investigation. (Doc. 45-11). The denial letter also included factual findings that: Souder's home was 114 years old; interior finishes and roofing were completed prior to moving in, and Souder did not make repairs to the drywall or roofing structure; the two inspections revealed bowing in the roof, causing a sag in the ceiling, resulting from ice damming during February of 2014; cracks in the drywall were caused by seasonable temperature changes; and improper ventilation caused excessive heat and moisture buildup, causing the sag. (Doc. 45-11). Souder challenges nearly all of these conclusions, including: the age of the home;[3] pointing out that she had the roof supports, drywall, and wiring in that area of the home redone after purchasing the home;[4] the presence of water damage in the drywall; seasonal changes as the cause for cracking in the drywall; the lack of ventilation in the attic; and the cause of the sag and dip in the roof. (Doc. 56, at 9-10). Citing the conclusions that the roof was lightly framed improperly ventilated, Travelers denied coverage as they do not insure against loss “caused by wear and tear, marring, deterioration, mechanical breakdown, latent defect, inherent vice, or any quality in property that causes it to damage or destroy itself.” (Doc. 45-11). The letter also states that the contract further denies coverage for loss due to “faulty, inadequate or defective . . . design, specifications, workmanship, repair, construction, renovation, remodeling, grading, [or] compaction.” (Doc. 45-11).

         In February 2015, Souder hired an engineer to inspect the property. (Doc. 45-2, ¶ 33). She also appears to have retained counsel between February and March, who reached out to Travelers inviting them to revisit their denial of coverage based on the findings. Travelers requested the reports and estimates for review. (Doc. 45-2, ¶¶ 35-36). Counsel provided the information as requested, and the parties arranged for a third inspection to take place on May 20, 2015. (Doc. 45-2, ¶ 37). On the date of the inspection, a dispute arose over the use of video to document the investigation. As a result, the inspection did not take place. (Doc. 45-2, ¶ 38).

         On June 29, 2015, Souder sued Travelers and Travelers H&M in the Schuylkill County Court of Common Pleas, filing her complaint on November 5, 2015. (Doc. 1-1). The Defendants removed to this Court on November 19, 2015. (Doc. 1). Following discovery, the Defendants filed the instant motion for partial summary judgment, alleging that Souder cannot establish the existence of bad faith in their decision to deny coverage. (Doc. 45). While the motion was pending, the parties consented to proceed before the undersigned on January 31, 2017. (Doc. 52). The parties filed their respective brief in opposition (Doc. 56-23) and reply (Doc. 67) on February 10 and April 28, 2017 respectively, rendering the motion ripe for review. II. Standard of Review Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment should be granted only if “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A fact is “material” only if it might affect the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute of material fact is “genuine” only if the evidence “is such that a reasonable jury could return a verdict for the non-moving party.” Anderson, 477 U.S. at 248. In deciding a summary judgment motion, all inferences “should be drawn in the light most favorable to the non-moving party, and where the non-moving party's evidence contradicts the movant's, then the non-movant's must be taken as true.” Pastore v. Bell Tel. Co. of Pa., 24 F.3d 508, 512 (3d Cir. 1994).

         A federal court should grant summary judgment “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Farrell v. Planters Lifesavers Co., 206 F.3d 271, 278 (3d Cir. 2000). In making this determination, “a court must view the facts in the light most favorable to the nonmoving party and draw all inferences in that party's favor.” Armbruster v. Unisys Corp., 32 F.3d 768, 777 (3d Cir. 1994). The Court need not accept mere conclusory allegations, whether they are made in the complaint or a sworn statement. Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 888 (1990). In deciding a motion for summary judgment, the court's function is not to make credibility determinations, weigh evidence, or draw inferences from the facts. Anderson, 477 U.S. at 249. Rather, the court must simply “determine whether there is a genuine issue for trial.” Anderson, 477 U.S. at 249.

         III. Discussion

         Under 42 Pa. ...

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