Dwyer, E. v. Ameriprise Financial

CourtSuperior Court of Pennsylvania
DecidedJuly 8, 2022
Docket519 WDA 2021
StatusUnpublished

This text of Dwyer, E. v. Ameriprise Financial (Dwyer, E. v. Ameriprise Financial) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dwyer, E. v. Ameriprise Financial, (Pa. Ct. App. 2022).

Opinion

J-A08021-22

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

EARL JOHN DWYER AND CHRISTINE : IN THE SUPERIOR COURT OF DWYER, HUSBAND AND WIFE : PENNSYLVANIA : Appellants : : : v. : : : No. 519 WDA 2021 AMERIPRISE FINANCIAL, INC., : AMERIPRISE FINANCIAL SERVICES, : INC., RIVERSOURCE LIFE : INSURANCE COMPANY, JAMES E. : ANDERSON, JR., AND DUANE : DANIELS1 :

Appeal from the Judgment Entered April 26, 2021 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD01-006612

BEFORE: BENDER, P.J.E., LAZARUS, J., and McCAFFERY, J.

MEMORANDUM BY LAZARUS, J.: FILED: July 8, 2022

Earl John Dwyer and Christine Dwyer (h/w) (collectively, Plaintiffs)

appeal from the judgment, entered in their favor, on jury and non-jury

verdicts, in the amount of $244,172.57.2 After review, we affirm.

____________________________________________

1 On March 19, 2019, the parties stipulated and the court entered an order decreeing that all claims against Defendant Duane Daniels were withdrawn from the instant lawsuit.

2 Broken down, Plaintiffs were awarded a total of $244,172.57— $75,000.00 in punitive damages, $45,569.81, plus interest, on their Unfair Trade Practices and Consumer Protection Law (UTPCPL) claim, and $123,602.76 in attorneys’ fees and costs. J-A08021-22

In August 1985, Plaintiffs purchased a $50,000.00 flexible, premium

adjustable whole life insurance policy3 (Policy) from Defendant, James

Anderson. Anderson, an American Express Financial Advisor (AEFA)4 and IDS

Life Insurance sales agent, completed the policy application and sold the policy

to Plaintiffs after being trained by Ameriprise. The parties used Ameriprise

forms in completing the insurance application. Plaintiffs’ premium was set at

$432/year, or $108/quarterly, with minimum monthly payments of $35.13.

The maturity date of the Policy was August 14, 2051, Earl Dwyer’s 95 th

birthday. The Policy had a $50,000 death benefit, with a guaranteed minimum

interest rate of 4.5% that was applied to the cash value of Policy; at the time

the Policy was issued, an interest rate of 9.5% was applied. Anderson

allegedly led Plaintiffs to believe that their quarterly payments would remain

the same for the life of the Policy, no matter how interest rates varied.

Universal Life policies permit the insured to adjust his or her premiums

and death benefits if the cash value is insufficient to cover the cost of the

policy, as these polices earn interest rates that vary depending on what the

insurance company is able to earn on the market. During the life of the current

Policy, the interest rate varied from 4.5% to 9.5%. Assuming that Plaintiffs

3 These policies are known as “universal life” policies.

4AEFA was renamed Riversource Life Insurance Company. IDS Financial and IDS Life were purchased by AEFA. IDS’s and AEFA’s names were ultimately changed to Ameriprise, Inc.

-2- J-A08021-22

continued to pay their original premiums quarterly, the Policy would have

lapsed for insufficient funds in 2020, when Earl Dwyer was 64 years old.

On April 4, 2001, Plaintiffs instituted the underlying action against

Appellees (Defendants) by filing a praecipe for a writ of summons. On August

23, 2007, Plaintiffs filed a complaint for negligent misrepresentation (Count

I), fraudulent misrepresentation (Count II), violation of the Unfair Trade

Practices and Consumer Protection Law (UTPCPL) (Count III), breach of

fiduciary duty (Count IV), and negligent supervision (Count V). Plaintiffs’

claims were based on their allegation that Anderson led them to believe that

their quarterly payment would remain the same for the life of the policy. See

Plaintiffs’ Complaint, 8/23/07, at ¶ 69 (alleging Defendants employed

“deceptive sales practices” with regard to persons who purchased universal

life insurance policies “sold by American Express and IDS agents using

illustrations and policy information representing a planned premium to be paid

by the policy holder, without disclosing that the planned premium was less

than the premium amount necessary to keep the policy in force for the

duration of the contract”). Plaintiffs sought damages in the amount of

$44,570.50, representing the return of their total premium payments of

$14,580.00,5 plus 6% interest.

5At the time of trial, Plaintiffs had paid a total of $14,580.00 in premiums over the approximately 35 years that the Policy had been in effect.

-3- J-A08021-22

Prior to trial, the parties agreed that the issue of liability for the

negligent and fraudulent misrepresentation claims and the question of

whether Defendants’ conduct was outrageous, for purposes of awarding

punitive damages, would be submitted to the jury (Phase I/Liability Trial).

Then, assuming liability was found by the jury, the trial court would determine

compensatory (return of premium) damages, including whether there should

be a set-off for the benefit of the coverage Plaintiffs received over the years

that the Policy was in effect. If the jury determined that Defendants’ conduct

was outrageous, the jury would be given evidence of Defendants’ net worth

to aid them in determining what, if any, amount of punitive damages should

be awarded (Phase II/Punitive Damages Trial). Finally, based on the evidence

presented at the Liability Trial, the trial court would render a verdict on

Plaintiffs’ UTPCPL claim.

A jury trial commenced on March 19, 2019. On March 25, 2019, the

jury returned a verdict6 in the Liability Phase in Plaintiffs’ favor on claims of

6 The jury’s verdict slip contained the following questions, the first two of which it answered in the affirmative:

Question 1:

Do you find that the Plaintiffs have proven by clear and convincing evidence that Defendants made a fraudulent misrepresentation of material fact to Plaintiffs upon which Plaintiffs justifiably relied to their financial harm?

Question 2:

-4- J-A08021-22

fraudulent misrepresentation and negligent misrepresentation. Specifically,

the jury found that Defendants made intentional, fraudulent

misrepresentations in the process of the sale of the Policy and that Plaintiffs

justifiably relied upon Defendants’ misrepresentations to their financial harm.

The jury also found that Defendants acted outrageously, thus

warranting consideration of punitive damages. Prior to instructing the jury on

punitive damages, the court, without objection, precluded Plaintiffs’ counsel

from arguing anything in closing statements related to the design of the Policy.

See N.T. Jury Trial (Phase II), 3/25/21, at 1130-33.7 In addition, the court

instructed the jury to consider only the conduct of Anderson8 when it ____________________________________________

Do you find that Plaintiffs have proven by a preponderance of the evidence that Defendants made a negligent misrepresentation of material fact to Plaintiffs upon which Plaintiffs justifiably relied to their financial harm?

If you answered “Yes” to either Question 1 or Question 2, or both, proceed to Question 3.

Question [3]:

State the amount of punitive damages, if any, you award to Plaintiffs.

July Verdict, 8/17/22.

7 N.T. Jury Trial (Phase II), 3/26/21, at 1100 (“I’m not disputing that. . . . But I don’t want to hear argument again about the [‘]corporation wrote this policy. The corporation sold this policy.[’] That is not relevant.

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Dwyer, E. v. Ameriprise Financial, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dwyer-e-v-ameriprise-financial-pasuperct-2022.