M. Pizzuti v. PA Ins. Dept.
206 M.D. 2021
| Pa. Commw. Ct. | Mar 4, 2022Background
- Dr. Douglas Dunham ordered elevated PSA tests for patient Thomas Pizzuti in 2013 but did not inform him; Dunham surrendered his medical license in 2013 and purchased a four‑year extended reporting endorsement (tail) from Care that expired September 19, 2017.
- New physician diagnosed Mr. Pizzuti with advanced prostate cancer in December 2016; Mr. Pizzuti died January 3, 2021.
- The Pizzutis sued the Dunham Estate for malpractice on September 24, 2018; Care denied coverage (claim filed after tail expiration) and the MCARE Fund also declined to defend or indemnify.
- The parties settled the malpractice suit for $1,000,000 on September 24, 2019, and the Dunham Estate assigned its coverage claims to Michele Pizzuti.
- On June 25, 2021 Pizzuti filed a Petition for Review (declaratory relief) in Commonwealth Court asserting Care, the MCARE Fund, and Trinity (agent/broker) are liable under the MCARE Act §715(d) or, alternatively, §715(a); defendants filed preliminary objections.
- The court overruled in part and sustained in part Care’s and the MCARE Fund’s preliminary objections, sustained Trinity’s objections (statute of limitations), and struck the petition’s request for attorneys’ fees and costs for this declaratory action.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Care had duty to defend/indemnify despite tail expiration under MCARE §715(d) | Pizzuti: Care was statutorily required to provide extended coverage per §715(d) and the policy violated that requirement | Care: insurer’s duty arises only if policy is in effect when claim is made; tail expired Sept. 19, 2017 so no duty | Court: pleaded sufficient facts to state a claim against Care; overruled demurrer at preliminary stage |
| Adequacy/specificity of pleading against Care | Pizzuti: complaint alleges tail purchase, expiration, statutory requirement, and underlying malpractice facts | Care: allegations lack detail on how policy violated law and how claim unfolded | Court: allegations plus attached underlying complaint and settlement are sufficiently specific; overruled objection |
| Conformity with Pa.R.Civ.P. re: attached writings (Care) | Pizzuti: alleged reporting to MCARE and denial letters (substance pleaded) | Care: omitted documents (C‑416 claim form, denial letter) prevent response | Court: those documents pertain to MCARE Fund, not Care, and are not essential to Pizzuti’s claim against Care; overruled objection |
| Recovery of attorneys’ fees and costs for this declaratory action | Pizzuti: seeks fees and costs incurred pursuing coverage | Respondents: American Rule bars fee shifting absent statute or agreement | Court: no statutory or contractual basis pleaded; struck demand for attorneys’ fees and costs for this action |
| Whether MCARE Fund must defend/indemnify if insurer not liable (§715 interplay) | Pizzuti: if Care not obligated, MCARE Fund must defend under §715(a) | MCARE Fund: §715(d) places obligation on insurer for policies issued after 2006, shifting duty away from MCARE Fund | Court: factual sufficiency alleged to allow claim against MCARE Fund; cannot resolve at preliminary stage; overruled demurrer |
| Negligence claims vs. Trinity (agent/broker) — timeliness | Pizzuti: Trinity negligently failed to secure required coverage | Trinity: negligence claims barred by two‑year statute of limitations | Court: claim accrued by Nov. 8, 2018 (MCARE denial); petition filed June 25, 2021 → time‑barred; sustained Trinity’s objection |
Key Cases Cited
- Highley v. Dep't of Transp., 195 A.3d 1078 (Pa. Cmwlth. 2018) (standard for accepting averments on preliminary objections)
- Pa. State Lodge, Fraternal Order of Police v. Dep't of Conservation & Nat. Res., 909 A.2d 413 (Pa. Cmwlth. 2006) (resolving doubts against sustaining preliminary objections)
- Gen. State Auth. v. Lawrie & Green, 356 A.2d 851 (Pa. Cmwlth. 1976) (pleading material facts to enable defense)
- W. Penn Allegheny Health Sys. v. Med. Care Availability & Reduction of Error Fund, 11 A.3d 598 (Pa. Cmwlth. 2010) (explaining claims‑made, occurrence, and tail coverage concepts)
- Merlino v. Del. Cnty., 728 A.2d 949 (Pa. 1999) (American Rule on attorneys’ fees)
- Fletcher v. Pa. Prop. & Cas. Ins. Guar. Ass'n, 985 A.2d 678 (Pa. 2009) (describing MCARE Fund as statutory excess carrier)