Fandray, N. v. Baum, A.
199 WDA 2016
| Pa. Super. Ct. | Nov 17, 2016Background
- Nita Fandray, an attorney, owned adoption agency A Bright Future Adoptions, Inc.; both were insured by ProAssurance.
- The Hannons sued Fandray and Adoption Related Services in 2009; Fandray and Bright Future were later added as defendants in that underlying suit.
- ProAssurance appointed Alan Baum to defend Fandray and Bright Future under a reservation of rights; the policy had an eroding liability limit ($100,000 defense threshold).
- Baum entered appearance, filed an Answer and New Matter asserting absolute defenses, pursued discovery, and drafted (then—at Fandray's request—withdrew) a motion for judgment on the pleadings.
- ProAssurance, without Fandray’s consent, settled the Hannons’ claim for $62,000 (within policy limits) in mid‑June 2011.
- Fandray and Bright Future sued Baum for legal malpractice and ProAssurance for breach of contract/bad faith; the trial court granted summary judgment for both defendants and the Superior Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Baum committed legal malpractice by failing to "timely prosecute" absolute defenses so the case would be dismissed before settlement | Baum delayed or inadequately prosecuted defenses; that delay caused the settlement and resulting damages | Baum timely asserted defenses, conducted discovery, filed motions, and withdrew a motion at Fandray's request; no breach or causation shown | Court: No genuine issue that Baum breached duty or proximately caused damages; summary judgment for Baum affirmed |
| Whether ProAssurance breached contract or acted in bad faith by settling without Fandray's consent | Settlement without consent was bad faith and breached insurer duties, harming Fandray | Policy expressly gave the insurer the right and duty to investigate and settle claims; settlement was within policy limits and reasonable | Court: Policy authorized settlement without insured consent and insurer acted in good faith; summary judgment for ProAssurance affirmed |
Key Cases Cited
- Englert v. Fazio Mechanical Services, Inc., 932 A.2d 122 (Pa. Super. 2007) (standard of review and summary judgment principles)
- Strausser v. Pramco, III, 944 A.2d 761 (Pa. Super. 2008) (appealability of multiple piecemeal orders)
- Epstein v. Saul Ewing LLP, 7 A.3d 303 (Pa. Super. 2010) (elements of legal malpractice)
- Myers v. Robert Lewis Seigle, P.C., 751 A.2d 1182 (Pa. Super. 2000) (legal malpractice standards)