37 Pa. D. & C.5th 109
Pennsylvania Court of Common P...2014Background
- Havice, an 86-year-old homeowner, sues Erie Insurance for breach of contract, bad faith, and common law fraud/deceit.
- Havice’s policy covered her home and personal property; repair work was performed after a 2010 roof repair and a May 26, 2011 hail storm.
- Erie inspected Havice’s home, paid some losses (gutters, fascia, etc.) but denied roof damage.
- Havice obtained external estimates for roof repairs totaling about $30,686 to $36,100; multiple neighbors also suffered hail damage.
- Erie allegedly threatened Havice with criminal implications for submitting a false claim, prompting Havice to hire additional experts; the parties dispute whether these statements relate to the contract or constitute a separate tort claim.
- The court sustained Erie’s preliminary objections in part, striking Count III on the gist of the action doctrine and dismissing consequential damages as moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Count III is barred by gist of the action doctrine | Havice (plaintiff) asserts fraud separate from contract | Erie argues misrepresentations are grounded in contract | Count III barred by gist of the action doctrine |
| Whether consequential damages in Count III may be awarded | Havice seeks consequential damages under Count III | Count III posture renders damages dependent on contract | Consequence damages moot; Count III dismissed as to that issue |
Key Cases Cited
- eToll, Inc. v. Elias/Savion Adver., Inc., 811 A.2d 10 (Pa. Super. 2002) (gist-of-the-action doctrine governs when fraud is intertwined with contract claims)
- Bash v. Bell Tel. Co., 601 A.2d 825 (Pa. Super. 1992) (breach of contract and fraud must be distinguished; contract-based fraud lacks tort remedy)
- Hart v. Arnold, 884 A.2d 316 (Pa. Super. 2005) (test for gist of the action considers the action as a whole, not isolated conduct)
- Pa. Mfrs.’ Ass’n Ins. Co. v. L.B. Smith, Inc., 831 A.2d 1178 (Pa. Super. 2003) (court analyzes whether fraud claims arise from contract or are collateral)
- Dercoli v. Pennsylvania National Mutual Insurance Co., 554 A.2d 906 (Pa. 1989) (plurally cited but less persuasive after gist-of-action doctrine)