                                                                                                                           Opinions of the United
2007 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


6-21-2007

Bealer v. Mutl Fire Marine
Precedential or Non-Precedential: Non-Precedential

Docket No. 06-4351




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                                                        NOT PRECEDENTIAL


                 UNITED STATES COURT OF APPEALS
                      FOR THE THIRD CIRCUIT

                              NO. 06-4351
                                _____
                          DONALD A. BEALER;
                         MARIANNE C. BEALER;
                           JAMES C. BEALER

                                     v.

    THE MUTUAL FIRE, MARINE AND INLAND INSURANCE COMPANY;
  THE FRANKLIN HOMEOWNERS ASSURANCE COMPANY; FHA HOLDING
      COMPANY; MIKE PETRELIA, Individually and as CFO & Treasurer;
          FRANK MCCALL, Individually an as Assistant Controller

                                Donald A. Bealer, Appellant
                ____________________________________

               On Appeal From the United States District Court
                  For the Eastern District of Pennsylvania
                      (E.D. Pa. Civ. No. 04-cv-5915)
                    District Judge: William H. Yohn, Jr.
                ____________________________________

                 Submitted Under Third Circuit LAR 34.1(a)
                               June 1, 2007

      Before: RENDELL, HARDIMAN AND COWEN, CIRCUIT JUDGES

                           (Filed: June 21, 2007)

                          ____________________

                                OPINION
                          ____________________



PER CURIAM
       Donald Bealer appeals an order of the United States District Court for the Eastern

District of Pennsylvania granting defendants’ motion for partial summary judgment, and

an order dismissing certain claims for failure to state a claim upon which relief may be

granted. For the reasons below, we will affirm the District Court’s judgment.

                                              I.

       On December 20, 2004, Bealer filed a pro se complaint against defendants Mutual

Fire, Marine and Inland Insurance Company (Mutual Fire) and its corporate officers Mike

Petrelia and Frank McCall, Franklin Homeowners Assurance Company (FHA), and FHA

Holding Company. Bealer filed an amended complaint on April 18, 2005. The amended

complaint contained nine counts: (1) breach of contract, (2) negligence, (3) slander, (4)

libel, (5) negligent misrepresentation, (6) intentional interference with contractual

relations, (7) fraud, (8) intentional infliction of emotional distress, and (9) civil RICO.

Bealer claimed the causes of action arose out of actuarial services he performed for

defendants from 1997 through 2003. Defendants filed a motion to dismiss, which the

District Court granted in part and denied in part. Specifically, the District Court

dismissed all counts except count one--seeking payment for actuarial services provided to

defendants for the years 1997 through 2003--and count six--alleging that defendants

intentionally interfered with Bealer’s contracts with certain other clients. Thereafter,

defendants filed a motion for partial summary judgment. The District Court granted the

motion, ruling that Bealer’s breach of contract claims, except those concerning contracts

allegedly breached in 2003, were barred by the statute of limitations. The District Court

                                               2
also ruled that Bealer’s claim concerning intentional interference with contractual

relations was either barred by the statute of limitations or without merit. Thus, the only

remaining claims were Bealer’s breach of contract claims for services performed in 2003.

On May 30, 2006, the parties settled the remaining contract claims before the Court.

Accordingly, on September 22, 2006, the District Court entered an order dismissing

Bealer’s breach of contract claim based on the settlement, without prejudice to Bealer’s

right to appeal the dismissal of other claims. Bealer appealed.

       We have appellate jurisdiction pursuant to 28 U.S.C. § 1291. Our review is

plenary. See Malia v. General Elec. Co., 23 F.3d 828, 830 (3d Cir. 1994). In reviewing

the order granting the motion to dismiss, we apply the same test as the District Court and

must accept as true the facts alleged in the complaint and view them in the light most

favorable to the plaintiff. See Fagin v. Gilmartin, 432 F.3d 276, 281 (3d Cir. 2005). In

reviewing a grant of summary judgment, we must view the facts in the light most

favorable to the non-moving party. See Smith v. Mensinger, 293 F.3d 641, 647 (3d Cir.

2002). Summary judgment is appropriate only if “there is no genuine issue as to any

material fact and . . . the moving party is entitled to judgment as a matter of law.” Fed. R.

Civ. P. 56(c).

                                       II. Discussion

       With respect to its order of August 1, 2005, the District Court correctly granted in

part defendants’ motion to dismiss. The District Court ruled that Bealer’s negligence,

negligent misrepresentation, and fraud claims were barred by the “gist of the action”

                                              3
doctrine. We agree. The gist of the action doctrine bars a plaintiff from bringing a tort

claim for damages that merely replicates a claim for breach of an underlying contract.

See Werwinksi v. Ford Motor Co., 286 F.3d 661, 680 n.8 (3d Cir. 2002). Bealer’s claims

of negligence, negligent misrepresentation, and fraud are barred because the gravamen of

the claims is in contract. See Bohler-Uddeholm America, Inc. v. Ellwood Group, Inc.,

247 F.3d 79, 103 (3d Cir. 2001) (to be construed as a tort action (and not a contract

action), the tortious wrong ascribed to the defendant must be the gist of the tort action

with the contract being collateral). Thus, the District Court correctly dismissed those

claims.

       The District Court also correctly dismissed counts three and four (slander and libel

respectively). According to Bealer, defendants’ slanderous remark was that Bealer was

“adamant” about not making false or improper changes to his actuarial reports. We agree

with the District Court that this statement cannot be construed to harm Bealer’s

reputation. See U.S. Healthcare, Inc. v. Blue Cross of Greater Philadelphia, 898 F.2d

914, 923 (3d Cir. 1990). Indeed, defendants’ alleged statement implies that Bealer

possesses, rather than lacks, professional integrity. With respect to his libel claim, Bealer

alleges that defendants distributed his actuarial reports and opinions without his consent

in 2003. For essentially the reasons given by the District Court, Bealer’s allegations do

not sufficiently establish a cause of action for either slander or libel.

       We also agree with the District Court that Bealer failed to state a claim for

intentional infliction of emotional distress. Although defendants might have been

                                               4
difficult to work with, Bealer failed to plead any conduct that was so outrageous and

extreme as to go beyond all bounds of human decency. See Williams v. Guzzardi, 875

F.2d 46, 51-52 (3d Cir. 1989).

       According to the District Court, Bealer’s civil RICO claim in count nine of the

amended complaint alleged two types of predicate acts that might form the basis of a

RICO violation: (1) conspiracy to steal Bealer’s services, and (2) using the United States

mail to defraud insurance regulators and policy holders. The District Court correctly

ruled that theft of services does not support a RICO claim. See Annulli v. Panikkar, 200

F.3d 189, 199 (3d Cir. 1999). Moreover, we agree with the District Court that even if

Bealer adequately alleged predicate acts (mail fraud) sufficient to satisfy the pleading

requirements for a RICO claim, Bealer lacked standing to raise a RICO claim, as he failed

to make the threshold showing that (1) he suffered an injury to his business or property,

and (2) the injury was proximately caused by defendants’ racketeering activities. See

Maio v. Aetna, Inc., 221 F.3d 472, 483 (3d Cir. 2000). In sum, we find no error in the

District Court’s decision to dismiss certain counts for failure to state a claim upon which

relief may be granted.1

       The District Court also correctly granted in part defendants’ motion for summary


  1
    For the reasons given by the District Court, we agree that Mutual Fire’s corporate
officers Petrelia and McCall cannot be personally liable for the contract between Mutual
Fire and Bealer. See Bel-Ray Co., Inc. v. Chemrite (Pty) Ltd., 181 F.3d 435, 445 (3d Cir.
1999). Thus, Petrelia and McCall were properly dismissed as defendants in the action.
Moreover, Bealer’s wife, Marianne Bealer, lacked standing to pursue either of the
surviving claims of the amended complaint.

                                             5
judgment. Under Pennsylvania law, the statute of limitations for contract actions is four

years. See 42 Pa. Cons. Stat. Ann. § 5525. Bealer filed his action on or about December

20, 2004. Accordingly, Bealer’s claims stemming from contracts between 1997 and 1999

are time-barred. Bealer did not make any claims for contracts between the years 2000-

2002. Thus, the District Court correctly granted summary judgment as to all the contract

claims except the one claim for services performed in 2003. Also, under Pennsylvania

law, the statue of limitations for a claim of intentional interference with a contract is two

years. See 42 Pa. Cons. Stat. Ann. § 5524; see also CGB Occupational Therapy, Inc. v.

RHA Health Services, Inc., 357 F.3d 375, 383-84 (3d Cir. 2004). The statute of

limitations begins to run at the time the cause of action accrues. Id.2 Bealer alleged that

his claim for intentional interference of a contract occurred in March and April of 2001.

According to Bealer, defendants’ unreasonable demands during this time caused him to

lose all of his other clients. We agree that this claim is time-barred. Bealer did not

identify any other claims for intentional interference of a contract.

       Based on the foregoing, we will affirm the judgment of the District Court.




  2
    We agree with the District Court’s thorough analysis in its May 3, 2006 memorandum
and order denying Bealer’s motion for reconsideration, that under the facts of this case,
the “discovery rule” did not toll the statutes of limitations. Dist. Ct. Memorandum, May
3, 2006 at 8-13.

                                              6
