In Post v. Liberty Mutual Group addressing Pennsylvania’s Unfair Trade Practices and Consumer Protection Law (“UTPCPL”) in the context of a claim against an insurer by its insured, the court observed that the “UTPCPL does not provide a cause of action for bad faith conduct based solely upon an insurance company’s refusal to pay a claim,” and that the “only provision of the UTPCPL that deals specifically with contractual obligations is section 201-2(4)(xiv), which prohibits ‘[f]ailing to comply with the terms of any written guarantee or warranty given to the buyer at, prior to or after a contract for the purchase of goods or services is made.’” However, under Pennsylvania law, it is only malfeasance, the improper performance of a contractual obligation, which raises a UTPCPL. By contrast, an insurer’s mere refusal to pay a claim, which constitutes nonfeasance, is considered the failure to perform a contractual duty, and is not actionable.
Date of Decision: June 17, 2014
Post v. Liberty Mut. Group, CIVIL ACTION NO.: 2:14-CV-238-CDJ,2014 U.S. Dist. LEXIS 83373 (E.D. Pa. June 17, 2014) (Jones, II, J.)