Bad faith claim against Hartford Insurance Company of Illinois dismissed without prejudice

By Nicholas Malfitano | Jun 2, 2016

PHILADELPHIA -- On Friday, a federal court dismissed a bad faith claim against Hartford Insurance Company of Illinois without prejudice, in advance of possible refiling.

Judge Gene E.K. Pratter ruled May 27 that the bad faith count in question brought by Joanne and Robert Canizares in their lawsuit against Hartford was dismissed without prejudice for failure to state a claim.

The plaintiffs initially sued Hartford in state court, alleging two counts. Count I alleged breach of contract, asserting Hartford “failed to fulfill their contractual obligations by fully compensating the Canizareses for damage caused to their home by a burst water pipe,” while Count II alleged a claim for bad faith under 42 Pa.C.S. Section 8371.

Based on diversity jurisdiction, Hartford removed the case to the U.S. District Court for the Eastern District of Pennsylvania and moved to dismiss the plaintiffs’ bad-faith claim pursuant to Federal Rule of Civil Procedure 12(b)(6) -- which the plaintiffs opposed.

“The Canizareses were insured by Hartford under a comprehensive homeowners policy. The policy covered damages to the premises as well as damages to personal property. The Canizareses paid all premiums when due and had satisfied all conditions of their policy,” Pratter said.

“In February 2015, the Canizareses discovered that frozen pipes within their home had burst and caused extensive water damage to their home as well as to their personal property. These damages were fully covered under the Canizareses’ insurance policy.”

Once the damages were discovered, the plaintiffs notified Hartford of their claim and requested reimbursement for their losses. Hartford agreed to pay part, but not all, of the claimed losses. According to the plaintiffs when they filed suit in February, the total cost of repairing the damages was $123,314.

Hartford motioned to dismiss the bad faith count for failure to state a claim, saying the plaintiffs did not “demonstrate that the insurer (1) lacked a reasonable basis for denying benefits and (2) knew or recklessly disregarded its lack of a reasonable basis.”

“The complaint contains six, rudimentary allegations related to the bad-faith claim, all of which contain legal conclusions which are not entitled to the assumption of truth. The closest the complaint comes to alleging a specific fact regarding Hartford’s handling of the claim is that Hartford 'failed to respond to plaintiffs’ claim for benefits within a reasonable period of time,'” Pratter wrote.

“The Canizareses, however, fail to include any specific dates detailing when the claim was submitted and when Hartford responded. Conclusory allegations of this nature are not sufficient for a bad-faith claim to survive a motion to dismiss.”

Though the plaintiff cited Pennsylvania pleading rules and their application in this case, Pratter said such rules do not apply in federal court.

“The Canizareses argue that, because Hartford dedicated five pages of its brief to a discussion of the bad-faith claim, Hartford must have sufficiently been put on notice of the claim. Such an argument fails,” the judge wrote.

“It may well be that facts will develop that would support a bad-faith claim. Indeed, discovery into the handling of this claim will certainly be among the next steps in the case, and it may well be that the Canizareses will seek permission to resume the bad-faith claim. They will be permitted to seek such permission if the facts so warrant.

“For the foregoing reasons, the Court grants Hartford’s motion to dismiss as to Count II of the complaint without prejudice, allowing the Canizareses to reassert the bad-faith claim in the event that they acquire appropriate evidence of Hartford’s bad faith through discovery,” Pratter concluded.

The plaintiffs are represented by Steven L. Rovner of Rovner Allen Rovner Zimmerman & Nash in Feasterville.

The defendant is represented by Michael J. McLaughlin and Richard D. Gable Jr. of Butler Pappas Weihmuller Katz Craig in Philadelphia.

U.S. District Court for the Eastern District of Pennsylvania case 2:16-cv-01465

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at

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