IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

PNC BANK, NATIONAL ASSOCIATION, : CIVIL ACTION

Trustee of the Harold G. Fulmer,:

III Irrevocable Deed of Trust :

Dated 8/21/97 :

 :

v. :

 :

AMERUS LIFE INSURANCE COMPANY : NO. 05-02966-JF

MEMORANDUM AND ORDER

Fullam, Sr. J. May 25, 2006

Plaintiff, PNC Bank, is the trustee of a trust, the

only asset of which consists of a $10 million life insurance

policy insuring the life of a gentleman named Harold G. Fulmer,

III. The defendant is the life insurance company which issued

the policy, in 1987.

Under the terms of the trust, PNC Bank became the owner

of the policy, and primarily responsible for dealing with the

insurance company in matters related to the policy. On the other

hand, the insured and his wife were required to pay the premiums,

which aggregated approximately $25,000 per quarter. Under the

terms of the policy, its cash-surrender value could, at the

option of the insured, be used to defray premiums. 

In May 2004, the defendant terminated the policy for

nonpayment of premiums, and declined to reinstate it because Mr.

Fulmer could no longer establish insurability, because of some

intervening health problems.

Case 2:05-cv-02966-JF Document 51 Filed 05/25/06 Page 1 of 4
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Plaintiff contends that the defendant’s cancellation of

the policy was unjustified, and that the defendant violated its

obligation to act in good faith. The principal factual basis for

this accusation is that, allegedly, the defendant misleadingly

assured the plaintiff (and the Fulmers) that the premiums already

paid were sufficient to keep the policy enforced for a longer

period; and that the defendant, after cancelling the policy,

assured the plaintiff that the policy would be reinstated, and

that there was nothing for the plaintiff or the insured to worry

about. 

The defendant disagrees with plaintiff’s contentions,

and insists that its actions were completely in conformity with

its contractual obligations in all respects. Defendant argues

that, if any of its employees gave incorrect information to

plaintiff, the circumstances were such that, as a matter of law,

it would have been unreasonable for plaintiff to rely upon these

statements. Defendant has therefore moved for summary judgment.

After argument, I conclude that the summary judgment

record establishes the existence of several material disputes of

fact. There are disputed issues as to precisely what assurances

were given by whom; and, of greater importance, whether reliance

was or was not reasonable is a factual matter, to be determined

at trial. I further conclude that it is not possible to rule, as

a matter of law, as to whether the plaintiff’s own (alleged)

Case 2:05-cv-02966-JF Document 51 Filed 05/25/06 Page 2 of 4
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errors sufficed to break the chain of causation. Defendant’s

motion for summary judgment will therefore be denied.

An Order follows.

Case 2:05-cv-02966-JF Document 51 Filed 05/25/06 Page 3 of 4
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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

PNC BANK, NATIONAL ASSOCIATION, : CIVIL ACTION

Trustee of the Harold G. Fulmer,:

III Irrevocable Deed of Trust :

Dated 8/21/97 :

 :

v. :

 :

AMERUS LIFE INSURANCE COMPANY : NO. 05-02966-JF

ORDER

AND NOW, this 25th day of May 2006, upon consideration

of defendant’s motion for summary judgment, and plaintiff’s

response, IT IS ORDERED:

That defendant’s motion for summary judgment is DENIED.

BY THE COURT:

/s/ John P. Fullam 

John P. Fullam, Sr. J.

Case 2:05-cv-02966-JF Document 51 Filed 05/25/06 Page 4 of 4