Property Law: A Year in Review Cristin A. Cavanaugh, Esq. Marshall Dennehey Warner Coleman & Goggin 2000 Market Street, Suite 2300 Philadelphia, PA 19103 215.575.2597 cacavanaugh@mdwcg.com

Topics Bad Faith Surface Water Vacant Property Material Misrepresentation Assignment Appraisal

Statutory Bad Faith 42 Pa.C.S. § 8371: Actions on insurance policies. In an action arising under an insurance policy, if the court finds that the insurer has acted in bad faith toward the insured, the court may take all of the following actions:  Award interest on the amount of the claim from the date the claim was made by the insured in an amount equal to the prime rate of interest plus 3%. Award punitive damages against the insurer. Assess court costs and attorneys fees against the insurer. There is a 2 year statute of limitations

Legislature Didn’t Define Bad Faith The Courts Did Insurer lacked reasonable basis for denying benefits Insurer knew or recklessly disregarded its lack of reasonable basis

Bad Faith Easy to Plead / Hard to Prove Bad faith claims are fact specific and depend on the conduct of the insurer vis a vis the insured. Any frivolous or unfounded refusal to pay proceeds of a policy It is not necessary that such refusal be fraudulent. Such conduct imports a dishonest purpose and means a breach of a known duty (i.e. good faith and fair dealing) Through some motive of self-interest or ill will Mere negligence or bad judgment is not bad faith.

Noteworthy Bad Faith Cases Dougherty v. Allstate Prop. and Cas. Ins. Co., 185 F.Supp.3d 585 (E.D. Pa. 2016) Yatonsky v. State Farm Fire & Cas. Co., 2016 U.S. Dist. LEXIS 167224 (M.D. Pa. 2016) Wehrenberg v. Metropolitan Prop. and Cas. Ins. Co., 2:14-cv-01477 (W.D. Pa. Jan. 10, 2017) Gowton v. State Farm Fire and Cas. Co., et al., No. 15-1164, 2017 U.S. Dist. LEXIS 29390 (W.D. Pa. 2017) Long v. Farmers New Century Ins. Co., No. 15-6724 (E.D. Pa. March 30, 2017) Rancosky v. Washington National Ins. Co., No. 124 WAL 2016 (Aug. 30, 2016)

First Party Property Cases Surface Water The Ridgewood Group, LLC v. Millers Capital Ins. Co., No. 1138 EDA 2016 (Feb. 28, 2017) (Non-Precedential Opinion) Vacant Property Mannino v. Westfield Ins. Co., Civ. A. No. 15-6487 (E.D. Pa. Nov. 7, 2016) Village Heights Condominium Assoc. v. The Cincinnati Ins. Co., 4:16-cv-554 (M.D. Pa. Feb. 10, 2017) Material Misrepresentation Payne v. Allstate Ins. Co., et al., No. 11-2546 (E.D. Pa. Nov. 22, 2016)

First Party Property Cases (cont'd) Assignment Charbonneau v. Chartis Prop. Cas. Co., No. 15-3549, U.S. Court of Appeals, Third Circuit (Feb. 23, 2017) Appraisal The Windridge of Naperville Condiminium Assoc. v. Philadelphia Indem. Ins. Co., 16 C 3860 (NE.D. of Illinois) (Memorandum Opinion Jan. 26, 2017)   Matter of Joseph Pottenburg v. Dryden Mut. Ins. Co., 2017 NY Slip Op 27054 (Feb. 28, 2017) Long v. Farmers New Century Ins. Co., No. 15-6724 (E.D. Pa. March 30, 2017)

Cristin A. Cavanaugh, Esq. Marshall Dennehey Warner Coleman & Goggin Thank You! If you need more information or have additional questions, please contact: Cristin A. Cavanaugh, Esq. Marshall Dennehey Warner Coleman & Goggin 2000 Market Street, Suite 2300 Philadelphia, PA 19103 215.575.2597 cacavanaugh@mdwcg.com