J-A28033-16


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

CHARLES F. COHAN AND LISA K.                     IN THE SUPERIOR COURT OF
COHAN,                                                 PENNSYLVANIA

                            Appellants

                       v.

UNITED SERVICES AUTOMOBILE
ASSOCIATION,

                            Appellee                  No. 683 EDA 2016


                Appeal from the Order Entered February 4, 2016
                in the Court of Common Pleas of Monroe County
                      Civil Division at No.: 1066 Civil 2013


BEFORE: PANELLA, J., SHOGAN, J., and PLATT, J.*

MEMORANDUM BY PLATT, J.:                          FILED JANUARY 05, 2017

        Appellants, Dr. Charles F. and Lisa K. Cohan, appeal from the trial

court’s order granting the preliminary objections filed by Appellee, United

Services Automobile Association, and dismissing their second amended

complaint with prejudice. We affirm.

        We take the following relevant facts and procedural history from the

trial court’s February 4, 2016, opinion and our independent review of the

certified record. In 1984, while he was a captain in the United States Army,

Charles Cohan purchased an automobile insurance policy from Appellee with

a $100,000.00 per person liability limit. He maintained the policy with the

____________________________________________


*
    Retired Senior Judge assigned to the Superior Court.
J-A28033-16



same coverage limits through 2011.             He married Lisa Cohan in 1995 and

added her to the auto policy as an “operator.”            Appellee never advised

Appellants that they should increase their automobile liability coverage.

       In 2002, Appellants purchased land and built a new home.               On

December 6, 2002, they purchased homeowner’s insurance from Appellee

with liability coverage in the amount of $1,000,000.00 per occurrence.

       On March 5, 2011, Lisa Cohan, while driving a Cohan vehicle, collided

with another vehicle, causing the driver fatal injuries. The administrator of

the estate of the decedent brought a wrongful death/survival action and

Appellee defended the action on behalf of Ms. Cohan. The matter settled for

$300,000.00, but Appellee paid only the policy limits of $100,000.00.

Appellants paid the remainder of the settlement amount.

       On April 1, 2015, Appellants filed a complaint against Appellee,

claiming, inter alia, that it should have advised Dr. Cohan to increase the

auto liability policy limits over the years that he was a customer, and

requesting judgment in the amount of $200,000.00.                  Appellee filed

preliminary objections thereto. On September 28, 2015, Appellants filed a

second amended complaint. Appellee filed preliminary objections, which the

trial court granted by order and opinion entered February 4, 2016, and it

dismissed the complaint with prejudice. This timely appeal followed.1

____________________________________________


1
  Pursuant to the trial court’s order, Appellants filed a timely concise
statement of errors complained of on appeal on March 9, 2016. See
(Footnote Continued Next Page)


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      Appellants raise the following issues for our review:

      1. Did the trial court err in holding that despite their twenty-
      seven year, multi-policy insurer-insured relationship and
      [Appellee’s] targeted affinity group based marketing, [Appellee]
      had no duty to coordinate [Appellants’] liability [c]overage
      across their policies or to reform the liability limits of their auto
      policy?

      2. Did the trial court err in granting [Appellee’s] preliminary
      objection demurrer to [Appellants’] [Unfair Trade Practices and
      Consumer Protection Law, 73 P.S. §§ 201-1—201-9.3] count by
      holding that [Appellants] must plead that they were “lied to” and
      that [Appellee’s] targeting affinity group based advertising
      program was “puffery”?

      3. Did the trial court err in declining to re-examine D’Ambrosio
      [v. Pennsylvania Nat. Mut. Cas. Ins. Co., 431 A.2d 966 (Pa.
      1981)] and hold that the [Unfair Insurance Practices Act, 40 P.S.
      §§ 1171.1—1171.15] provides insurance consumers a private
      right of action[?]

(Appellants’ Brief, at 11) (unnecessary capitalization omitted).

      In reviewing an order granting preliminary objections, our standard of

review is as follows:

                    Preliminary objections in the nature of a
             demurrer should be granted where the contested
             pleading is legally insufficient. Preliminary objections
             in the nature of a demurrer require the court to
             resolve the issues solely on the basis of the
             pleadings; no testimony or other evidence outside of
             the complaint may be considered to dispose of the
             legal issues presented by the demurrer. All material
             facts set forth in the pleading and all inferences
                       _______________________
(Footnote Continued)

Pa.R.A.P. 1925(b). The court filed a Rule 1925(a) statement on March 10,
2016, in which it relied on the opinion it entered on February 4, 2016. See
Pa.R.A.P. 1925(a).



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            reasonably deducible therefrom must be admitted as
            true.

            In reviewing a trial court’s grant of preliminary objections,
      the standard of review is de novo and the scope of review is
      plenary. Moreover, we review the trial court’s decision for an
      abuse of discretion or an error of law.

Kilmer v. Sposito, 146 A.3d 1275, 1278 (Pa. Super. 2016) (citations and

quotation marks omitted).

      In their first issue, Appellants argue the trial court erred by dismissing

the negligence counts where Appellee failed to “coordinate and equalize” the

limit of their automobile insurance policy with the later-selected liability limit

of their homeowner’s insurance policy. (Appellants’ Brief, at 21; see id. at

13-21). Specifically, “[Appellants’] complaint is that for decades [Appellee]

issued their auto insurance policy with a $100,000.00 liability limit and

continued the $100,000 liability limit even after writing their homeowner’s

policy with a $1,000,000.00 policy limit.” (Id. at 18). Appellants take issue

with the fact that at the time they purchased the homeowner’s policy, “no

one from [Appellee] thought to mention to [Appellants] that after 18 years

at $100,000.00, it might be time to increase their auto liability limit.” (Id.

at 4). This issue does not merit relief.

      We begin by noting, “Pennsylvania courts have often stressed that the

insured has both the capacity and the duty to inquire about the scope of

insurance coverage, rather than rely on hand holding and substituted

judgment.” Wisniski v. Brown & Brown Ins. Co. of PA, 906 A.2d 571,

579 n.6 (Pa. Super. 2006), appeal denied, 920 A.2d 834 (Pa. 2007)


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J-A28033-16



(citations and quotation marks omitted).         “[T]his Court [has] rejected

arguments . . . that an insurer has a duty to provide more comprehensive

notice and explanation of the benefits provided in the insured’s policy.”

Treski v. Kemper Nat. Ins. Companies, 674 A.2d 1106, 1114 (Pa. Super.

1996). The Treski Court stated that there is:

      no justification in the law to impose the additional burden on
      insurers that they anticipate and then counsel their insured on
      the hypothetical, collateral consequences of the coverage chosen
      by the insured.      The basic contractual nature of insurance
      coverage set forth in [our case law] requires fair dealing and
      good faith on the part of the insurer, not hand holding and
      substituted judgment. While we acknowledge insurance is an
      area in which the contracting parties stand in somewhat special
      relationship to each other, the relationship is not so unique as to
      compel this Court to require an insurer to explain every
      permutation possible from an insured’s choice of coverage. Each
      insured has the right and obligation to question his insurer at the
      time the insurance contract is entered into as to the type of
      coverage desired and the ramifications arising therefrom. Once
      the insurance contract takes effect, however, the insured must
      take responsibility for his policy. We, therefore, decline to
      extend the duties of an insurer to provide ongoing advice
      concerning the limits of its coverage.

Id. (citations omitted).

      Here, the trial court found that Appellee did not have a duty to advise

Appellants to purchase higher liability limits on their auto insurance policy,

regardless of the terms in the separate homeowner’s policy.          (See Trial

Court Opinion, 2/04/16, at 13, 15).     Upon review, we agree with the trial

court that Appellee had no obligation to advise Appellants of a disparity in

liability coverage that they should have been aware of, or to otherwise

“coordinate” or “equalize” the liability limits of two different policies. To the


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contrary, “[o]nce the insurance contract takes effect . . . the insured must

take responsibility for his policy.” Treski, supra at 1114 (citation omitted).

We also observe Appellants’ argument, that the two policies should have

been “equalized,” overlooks the salient fact that an automobile insurance

policy and a homeowner’s insurance policy are not coextensive and insure

against very different risks. Therefore, we conclude that the trial court did

not err in dismissing the negligence counts of the complaint. See Kilmer,

supra at 1278. Appellants’ first issue does not merit relief.

      In their second issue, Appellants challenge the trial court’s dismissal of

the Unfair Trade Practices and Consumer Protection Law (UTPCPL) count by

arguing that the court erroneously interpreted the UTPCPL’s catchall

provision as requiring them to allege and prove common law fraud.            (See

Appellants’ Brief, at 21-26).    Appellants further maintain that the court

supported its finding that they failed to plead fraud by characterizing

Appellee’s   advertising   program   aimed   at   U.S.   military   personnel   as

“commercial puffery.”      (Id. at 23; see id. at 25-26) (record citation

omitted). We disagree.

      In Bennett v. A.T. Masterpiece Homes at Broadsprings, LLC, 40

A.3d 145 (Pa. Super. 2012), this Court examined the relevant standard for

the UTPCPL catchall provision. The Bennett Court concluded:

            The UTPCPL provides a private right of action for anyone
      who “suffers any ascertainable loss of money or property” as a
      result of an unlawful method, act or practice. 73 P.S. § 201–
      9.2(a). Upon a finding of liability, the court has the discretion to
      award “up to three times the actual damages sustained” and

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J-A28033-16


      provide any additional relief the court deems proper.          Id.
      Section 201–2(4) lists twenty enumerated practices which
      constitute actionable “unfair methods of competition” or “unfair
      or deceptive acts or practices.” 73 P.S. § 201–2(4)(i)–(xx). The
      UTPCPL also contains a catchall provision at 73 P.S. § 201–
      2(4)(xxi).      The pre–1996 catchall provision prohibited
      “fraudulent conduct” that created a likelihood of confusion or
      misunderstanding. 73 P.S. § 201–2(4)(xvii).         In 1996, the
      General Assembly amended the UTPCPL and revised Section
      201–2(4)(xxi) to add “deceptive conduct” as a prohibited
      practice. The current catchall provision proscribes “fraudulent or
      deceptive conduct which creates a likelihood of confusion or of
      misunderstanding.” 73 P.S. § 201–2(4)(xxi) (emphasis added).

             Pre-amendment decisions from this Court relied on the
      plain language of the UTPCPL to hold proof of common law fraud
      was necessary to state a claim under the catchall provision. . . .

                                *    *     *

      . . . The legislature’s inclusion of “deceptive” in 1996 signaled
      that either fraudulent or deceptive conduct would constitute a
      catchall violation. The amendment also implied that deceptive
      conduct is something different from fraudulent conduct.
      Moreover, maintaining a standard that demands fraud even after
      the amendment would render the legislature’s addition of
      “deceptive” redundant and meaningless in a manner inconsistent
      with well-established principles of statutory interpretation.
      Overlooking the addition of “deceptive” would also neglect our
      Supreme Court’s pronouncement that courts should liberally
      construe the UTPCPL. For these reasons, we hold deceptive
      conduct which creates a likelihood of confusion or of
      misunderstanding can constitute a cognizable claim under
      Section 201–2(4)(xxi).

                                 *    *    *

      . . . We further hold the court correctly instructed the jury on the
      relevant standard for the UTPCPL catchall provision, when it
      stated “misleading conduct” could constitute a violation[.]

Id. at 151–52, 154-56 (footnote and some citations omitted; emphasis in

original).

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J-A28033-16



      Here, a review of the record belies Appellants’ contention that the trial

court erroneously required them to establish common law fraud, in

contravention of the Bennett decision.       (See Appellants’ Brief, at 22).

Instead, the record reflects that the trial court expressly acknowledged that

the UTPCPL does not require pleading or proof of fraud, and that the law

prohibits fraudulent or deceptive conduct. (See Trial Ct. Op., at 15). The

court concluded:

             [Appellants] have not alleged misrepresentations by
      [Appellee] that would a support a finding of fraud or deception.
      The Second Amended Complaint identifies [Appellee’s]
      advertisements that service members “may trust [Appellee] to
      meet all their insurance needs,” and that [Appellee] “would
      protect the insurance needs of [U.S.] military and former
      military personnel and their families.”        (Second Amended
      Complaint, 9/28/15, at ¶¶ 47, 54).        [Appellants] make no
      allegations that they were lied to about the proper limits they
      should obtain, and the court has found that [Appellee] had no
      contractual or tort duty to advise them of appropriate liability
      limits for their needs. The statements complained of were
      commercial puffery, not misrepresentations of fact.

(Id. at 16) (record citation formatting provided; emphasis added; case

citations omitted).

      Thus, a review of the record indicates that the trial court was aware of

the appropriate standard for the UTPCPL catchall provision, and that it did

not erroneously require Appellants to plead the elements of common law

fraud. Appellants’ second claim does not merit relief.

      In their final issue, Appellants challenge the trial court’s dismissal of

the Unfair Insurance Practices Act (UIPA) count by arguing that this Court



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should   re-examine     the   Pennsylvania     Supreme    Court’s      holding   in

D’Ambrosio, supra, that there is no private right of action under the UIPA.

(See Appellants’ Brief, at 26-33).      Appellants contend that “[t]his [C]ourt

should re-examine D’Ambrosio in the context of twenty-first century

insurance industry advertising[,]” and recognize a private right of action

under the UIPA. (Id. at 32; see id. at 33). This issue does not merit relief.

      We begin by observing the well-settled principle that this Court is

bound by existing precedent.        See Bell v. Willis, 80 A.3d 476, 479 (Pa.

Super. 2013), appeal denied, 89 A.3d 1282 (Pa. 2014) (“As an intermediate

appellate court, this Court is obligated to follow the precedent set down by

our Supreme Court. It is not the prerogative of an intermediate appellate

court to enunciate new precepts of law or to expand existing legal

doctrines.”) (citations omitted).

      With respect to the UIPA, this Court has explained:

            The purpose of the UIPA is

                   to regulate trade practices in the business of
            insurance in accordance with the intent of congress .
            . . by defining or providing for the determination of
            all such practices in this state which constitute unfair
            methods of competition or unfair or deceptive acts or
            practices and by prohibiting the trade practices so
            defined or determined.
      40 P.S.A. § 1171.2. Thus, “[n]o person shall engage in this
      state in trade practice which is defined or determined to be an
      unfair method of competition or an unfair or deceptive act or
      practice in the business of insurance pursuant to [the UIPA].”
      40 P.S.A. § 1171.4. These statutory provisions are enforced by
      the Pennsylvania Insurance Commissioner who is empowered “to
      examine and investigate the affairs of every person engaged in

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      the business of insurance in this state” to determine whether the
      UIPA has been violated. 40 P.S.A. § 1171.7. If, after an
      investigation, the Insurance Commissioner has a good faith
      belief that a person has violated the UIPA, an administrative
      hearing is to be held before the Commissioner.             If the
      Commissioner determines that a violation occurred, he may
      impose sanctions, including a cease and desist order or the
      suspension or revocation of the person’s license. 40 P.S.A. §
      1171.9. The Commissioner may also seek civil penalties. 40
      P.S.A. § 1171.11.

Jones v. Nationwide Prop. & Cas. Ins. Co., 995 A.2d 1233, 1236 (Pa.

Super. 2010), aff'd on other grounds, 32 A.3d 1261 (Pa. 2011).

      In D’Ambrosio, our Supreme Court noted that the UIPA is to be

enforced by the Insurance Commissioner, and held that no private right of

action was created by the UIPA.       See D’Ambrosio, supra at 969-70.           It

stated:

             There is no evidence to suggest, and we have no reason to
      believe, that the system of sanctions established under the
      Unfair Insurance Practices Act must be supplemented by a
      judicially created cause of action. . . . Surely it is for the
      Legislature to announce and implement the Commonwealth’s
      public policy governing the regulation of insurance carriers. In
      our view, it is equally for the Legislature to determine whether
      sanctions beyond those created under the Act are required to
      deter conduct which is less than scrupulous.

Id. at 970; see also Jones supra, at 1236 (“The UIPA does not create a

private cause of action.”) (citation omitted).

      Here,   although   Appellants    urge    this   Court   to   reconsider   the

D'Ambrosio holding, we decline to do so, and reiterate that as an

intermediate appellate court, we are bound to follow existing precedent.




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J-A28033-16



See Bell, supra at 479. Therefore, Appellants’ final issue on appeal does

not merit relief. Accordingly, we affirm the order of the trial court.

      Order affirmed.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 1/5/2017




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