Wilson, B. v. Erie Insurance Group

Superior Court of Pennsylvania·Decided May 13, 2019·No. 717 WDA 2018·Unpublished

Opinion

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

BENJAMIN A. WILSON AND : IN THE SUPERIOR COURT OF KATHLEEN WILSON : PENNSYLVANIA :

Appellants :

:

:

v. :

:

: No. 717 WDA 2018

ERIE INSURANCE GROUP AND ERIE : INSURANCE EXCHANGE :

Appeal from the Order Entered April 27, 2018 In the Court of Common Pleas of Bedford County Civil Division at No(s):

612 of 2002

BEFORE: BOWES, J., SHOGAN, J., and STRASSBURGER*, J. MEMORANDUM BY BOWES, J.: FILED MAY 13, 2019 Benjamin A. Wilson and Kathleen Wilson (“the Wilsons”) appeal from the April 27, 2018 order denying their motion for relief from judgment of non pros, which the trial court entered based on inactivity. After thorough review, we reverse the order, vacate the judgment of non pros, and remand.

The underlying facts relevant to our review consist of the following. At all times relevant hereto, the Wilsons insured their two motor vehicles with Erie Insurance Group and Erie Insurance Exchange (“Erie”). In addition to the coverages mandated under Pennsylvania law, they paid substantial premiums to purchase $250,000/$500,000 in stacked uninsured/underinsured (“UM/UIM”) coverage calculated to protect their family and other passengers in their vehicles injured by an uninsured or underinsured driver.

* Retired Senior Judge assigned to the Superior Court.

On February 14, 1999, Kathleen Wilson was seriously injured in an automobile accident while driving one of the vehicles insured under the Erie policy. She suffered injuries to her left foot and a herniated cervical disc, both of which required surgery, and a closed head injury that left her with permanent cognitive defects.

The Wilsons settled with the other at-fault driver, and notified Erie that they intended to pursue UIM benefits under their policy. In 2000, Erie offered $50,000 to settle the UIM case. The insurer subsequently doubled its offer to $100,000, stating at that time that it would not increase the offer. In advance of a January 21, 2002 mediation requested by Erie, the Wilsons demanded $450,000 to settle the claim. Medical experts and therapists confirmed Mrs. Wilson’s cognitive impairment, and that information was provided to Erie. The Wilsons also provided the economic report of James L. Kenkel, Ph.D., calculating a future economic loss of $845,000 based upon Mrs. Wilson’s diminished earning capacity.1 After a UIM arbitration was scheduled for June 27, 2002, Erie offered $350,000 to settle the case on May 29, 2002. Thereafter, Erie increased its reserves twice, and the parties reached a $425,000 settlement on June 11, 2002, more than three years after the accident.

On June 26, 2002, the Wilsons filed an action against Erie sounding in

bad faith, breach of contract, and violations of the Unfair Trade Practices and

1 According to the Wilsons’ insurance expert, Erie did not re-evaluate the claim or adjust its reserves upon receipt of this information.

Consumer Protection Law. The Wilsons pled that Erie failed to timely investigate and evaluate their UIM claim, and pay benefits in accordance with its policy.

The record reveals that, after the close of the pleadings, the parties engaged in discovery throughout 2003 and 2004. Disputes arose over the production of Erie’s fraud investigation and claims evaluation manuals. On April 2, 2004, the Wilsons filed a motion to compel discovery, which the trial court denied on September 15, 2004. Thereafter, no activity is reflected on the docket for two years. The Prothonotary of Bedford County issued a notice of termination for inactivity on October 2, 2006. The Wilsons filed a statement of intention to proceed, and the parties continued to conduct discovery. In June 2007, the Wilsons deposed Erie claims supervisor Thomas Wolf, and several other Erie employees were noticed for deposition. Based on Mr. Wolf’s testimony, the Wilsons again moved to compel discovery, which the court denied in August 2007. Thereafter, the docket sat idle for more than three years, and the Prothonotary issued notice of its intention to terminate the case for inactivity on February 14, 2011. The Wilsons filed a statement of intention to proceed.

No further record activity is reflected until May 16, 2013, when the Wilsons served a deposition notice upon Erie’s senior fraud investigator, George Spellman, and filed another motion to compel. The deposition did not occur. In March 2015, the Wilsons again noticed Mr. Spellman for deposition, but he was not produced by Erie. On August 10, 2016, the Wilsons noticed

Mr. Spellman’s deposition yet again, as well as several additional depositions, but Mr. Spellman’s deposition did not take place as scheduled.

On June 23, 2017, the Wilsons filed a motion to place the case on the civil trial list. Erie filed a motion for summary judgment on September 12, 2017, alleging first, that there were no genuine issues of material fact and that it was entitled to judgment as a matter of law, and second, that the court should enter a judgment of non pros due to inactivity on the docket. In support of the non pros, Erie attached a copy of the docket. The Wilsons filed a response in opposition to summary judgment with supporting documentation.

While Erie’s motion for summary judgment was pending, the court held a pretrial conference. In its October 11, 2017 pretrial order, the court ordered the completion of discovery by February 15, 2018; dispositive trial motions filed no later than March 1, 2018; jury selection to take place on March 2, 2018 and a jury trial from April 2, through April 6, 2018. It also scheduled argument on Erie’s motion for summary judgment for November 22, 2017, but it is unclear from the record whether the argument took place.

On January 16, 2018, Erie filed a supplement to its motion for summary judgment or, in the alternative, a motion to compel discovery. Erie maintained that non pros should be granted citing the Wilsons’ delay in providing responses to discovery as prejudicial. The Wilsons provided discovery responses five days later, which was one month prior to the close of discovery.

Erie took the depositions of Mr. and Mrs. Wilson on February 9 and 15, 2018, and produced its expert report on February 15, 2018. On February 28, 2018, the Wilsons filed Exhibit I to their reply in opposition to summary judgment, which consisted of the expert report of Stuart Setcavage. That same day, the court granted summary judgment in the nature of judgment of non pros2 and dismissed the Wilsons’ complaint with prejudice, citing Jacobs v. Halloran, 710 A.2d 1098 (Pa. 1998). The court found that the Wilsons lacked due diligence in prosecuting their action with reasonable promptitude, advanced no compelling reason for their inaction, and that their failure to respond to Erie’s discovery requests for more than a decade resulted in a “substantial diminution” of Erie’s ability to properly present its case at trial.

The Wilsons timely filed a petition seeking relief from judgment of non pros pursuant to Pa.R.C.P. 3051(c), and Erie filed an answer. Following argument on April 17, 2018, the court denied the petition on April 27, 2018. The Wilsons filed the instant appeal, and both the Wilsons and the trial court complied with Pa.R.A.P. 1925. The Wilsons raise three issues on appeal:

A. Under the circumstances of this case, did the lower Court err and/or abuse its discretion in determining Erie Insurance suffered actual prejudice resulting in a substantial diminution of its ability to properly present its case at trial due to delay

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