Court Opinion

ID: 2819285
Source: CourtListenerOpinion
Date Created: 2015-07-22 19:12:37.062095+00
Date Added: 2024-06-11T15:44:01.805292
License: Public Domain

J-A05024-12

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

DAVID BRUNO AND ANGELA BRUNO,                 IN THE SUPERIOR COURT OF
HUSBAND AND WIFE, AND ANTHONY                       PENNSYLVANIA
GOTTI BRUNO AND MCKAYLA MARIE
BLAKE, BY THEIR PARENTS AND LEGAL
GUARDIANS, DAVID BRUNO AND
ANGELA BRUNO,

                        Appellants

                   v.

ERIE INSURANCE COMPANY, RUDICK
FORENSIC ENGINEERING, INC., AND
THERESA PITCHER AND MARC PITCHER,

                        Appellees                 No. 1154 WDA 2011

                Appeal from the Order Entered June 27, 2011
              In the Court of Common Pleas of McKean County
                    Civil Division at No(s): 1369 of 2009.

BEFORE: BOWES, OLSON, and PLATT,* JJ.

MEMORANDUM BY OLSON, J.:                             FILED JULY 22, 2015

     Appellants, David Bruno and Angela Bruno (husband and wife) and

Anthony Gotti Bruno and McKayla Marie Blake, by their parents and legal

guardians, David Bruno and Angela Bruno, appeal from the trial court’s order

entered June 27, 2011, wherein the trial court amended its order entered

May 25, 2011, and made an “express determination that an immediate

appeal [of the May 25, 2011 order] would facilitate resolution of the entire

*Retired Senior Judge assigned to the Superior Court.
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case.”1    See Pa.R.A.P. 341(c).         The case returns to this Court following

remand from the Pennsylvania Supreme Court. We vacate the trial court’s

order and remand.

       On August 30, 2010, Appellants filed a twelve-count complaint against

Erie Insurance Company (“Erie Insurance”), Rudick Forensic Engineering,

Inc. (“Rudick Engineering”), Theresa Pitcher, and Marc Pitcher.2 According

to the complaint, in September 2007, David Bruno negotiated the purchase

of the Pitchers’ Bradford, Pennsylvania house.             Appellants’ Complaint,

8/30/10, at ¶ 6.       Prior to the sale of the house, the Pitchers executed a

“Seller’s Property Disclosure Form” and delivered the form to Appellants.

The form, which is required by Pennsylvania’s Real Estate Seller Disclosure

Law, 68 Pa.C.S.A. § 7301, et seq., obligated the Pitchers to “disclose to the

buyer [of the real estate] any material defects with the property known to

the seller.” 68 Pa.C.S.A. §§ 7303 and 7304. Yet, as Appellants aver, the

Pitchers’ “disclosure[ form] failed to inform [Appellants] that [the Pitchers]

were aware of the presence of water leakage and of mold of a type and in a

____________________________________________

1
  The trial court’s May 25, 2011 order: 1) sustained the preliminary
objections of Erie Insurance Company; and 2) sustained in part and
overruled in part the preliminary objections of Rudick Forensic Engineering,
Inc.
2
 Appellants instituted the current lawsuit on September 28, 2009, by filing a
praecipe for a writ of summons.

                                           -2-
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quantity that it posed a health hazard to residents of the home.” Appellants’

Complaint, 8/30/10, at ¶ 4.

     Unaware of the water or mold, Appellants purchased the Pitchers’

house on September 28, 2007. Id. at ¶¶ 9 and 13. Further, in connection

with the ownership of the property, David Bruno purchased a Homeowner’s

Insurance Policy from Erie Insurance. Id. at ¶ 11. The policy insured each

of the Appellants. Id. at ¶ 15.

     As Appellants aver, on October 5, 2007, David Bruno and a contractor

were remodeling the basement of the house when they discovered “two

damp areas with black mold behind the paneling . . . , which appeared to be

in the vicinity of leaky pipes located behind the walls.” Id. at ¶ 12. David

Bruno immediately contacted Erie Insurance, notified the company of the

damage, and informed Erie Insurance “that he wished to initiate a claim

under his [Homeowner’s Insurance P]olicy for the damage to his home

caused by the leakage of water and the mold.” Id. at ¶ 14.

     On October 9, 2007, Scott Steffey (an adjuster for Erie Insurance) and

Jerome D. Paulick, P.E. (an engineer for Rudick Engineering) arrived at

Appellants’ home to inspect the damage. Id. at ¶ 16. Appellants aver:

        Mr. Steffey was asked . . . if he would authorize payment of
        the policy limit for mold of [$5,000.00], so that [Appellants]
        could have the mold tested. Both Mr. Steffey and [Mr.
        Paulick] told [David] Bruno and [David Bruno’s] contractor
        that the mold was harmless and that they should continue
        tearing out the existing paneling. [Messrs. Steffey and
        Paulick] stated that health problems associated with mold
        were a media frenzy and overblown. Mr. Steffey stated that

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        he could not authorize payment, as no determination had
        yet been made that coverage was available.

Id. at ¶¶ 18-20 (internal paragraphing omitted).

      According to Appellants’ complaint, “[b]ased on the assurances that

[Appellants] received from Rudick [Engineering] and Scott Steffey that the

mold did not pose a health hazard, [David] Bruno and his contractor

proceeded to remove additional paneling from the basement and attempted

to eradicate the mold they found there themselves.”     Id. at ¶ 21. During

the course of this remodeling, Appellants continued to live in the house. Id.

      As the remodeling progressed, David Bruno and his contractor

discovered additional plumbing leaks and other areas of black mold. Id. at

¶ 22. Appellants notified Erie Insurance of these additional findings and Erie

Insurance again sent Mr. Paulick, from Rudick Engineering, to inspect the

damage.    Id. at ¶ 23.     During this second inspection, “[n]either Erie

[Insurance] nor its consultant, Rudick [Engineering], told [Appellants] of the

dangers to their physical health by exposure to the mold in their home, nor

the necessity of quick professional action to remediate, encapsulate and/or

remove the mold before it spread.” Id. at ¶ 24.

      According to Appellants:

        As October [2007] progressed, [Appellants] began to
        experience health problems, beginning with respiratory
        problems that appeared to be sinusitis or allergies and
        headaches. [Appellants] did not at that time associate
        these health problems with the presence of mold in their
        house.

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           In January [2008], Angela Bruno became seriously ill
           experiencing severe coughing, difficulties clearing her throat
           and breathing, and severe headaches. In an attempt to
           determine the cause, [Appellants] decided to have the mold
           in their basement tested, on their own, at their own
           expense. The testing revealed the presence of toxic mold in
           their basement, which posed a health hazard.

Id. at ¶¶ 26-29 (internal paragraphing omitted).

     Following the test, Appellants contacted Erie Insurance and “asked Erie

to pay the [$5,000.00] coverage available under [the] policy for mold

eradication as well as other coverage available for the repair of water

damage.” Id. at ¶ 30. Erie Insurance informed Appellants that the matter

was still under investigation and that a claim decision had not yet been

made. Id.

     On April 23, 2008, Erie Insurance rendered payment on the claim. Id.

at ¶ 32.     Yet, as Appellants contend, “[b]y that point, the problems with

mold in [Appellants’] home had become much more serious.” Id. at ¶ 33.

Indeed, Appellants allege that, as a direct and proximate result of the acts

and omissions of the defendants: “Angela Bruno has been diagnosed with

cancer of the esophagus and voice box[,] which her doctors believe was

caused by exposure to the mold in the home;” Appellants were required to

move out of their home; and, because Appellants’ home could not be

eradicated of mold, Appellants were forced to demolish the house.           Id. at

¶¶ 33-36.

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        Based upon the above averments, Appellants levied twelve claims

against the defendants. Counts one through four were filed against Theresa

and Marc Pitcher and are not relevant to the current appeal. The remaining

counts are as follows:3 Count 5 (bad faith against Erie Insurance); Count 6

(breach of covenant of good faith and fair dealing against Erie Insurance,

asserted solely by David Bruno); Count 7 (negligence against Erie Insurance,

asserted by Angela Bruno and David Bruno); Count 8 (breach of contract

against     Rudick    Engineering);      Count   9   (negligence   against   Rudick

Engineering); Count 10 (professional liability against Rudick Engineering);

Count 11 (negligent misrepresentation against Rudick Engineering); and,

Count 12 (misrepresentation/fraud against Rudick Engineering).           Each tort

claim listed above demanded the award of punitive damages.               Moreover,

Appellants did not file a certificate of merit with their complaint.

        With respect to Erie Insurance, only Count 7 – the negligence claim –

is relevant to the current appeal. As to this claim, Appellants alleged that

Erie Insurance was negligent in: misleading Appellants about the nature of

the mold problem; failing to “recognize the nature and severity of the mold

problem;” failing to warn Appellants of the mold problem; failing to select

and train its agents and employees; failing to properly inspect the premises;

failing to properly analyze the test results; delaying the reporting of the test

____________________________________________

3
    Unless otherwise indicated, the claims were asserted by all Appellants.

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results; and, minimizing the dangers and consequences of the mold

infestation. Id. at ¶ 91(a)-(v).

      On December 3, 2010, Erie Insurance filed preliminary objections to

Appellants’ complaint and challenged the complaint on three grounds. First,

Erie Insurance claimed that, since Pennsylvania law “does not recognize an

independent cause of action for breach of the contractual duty of good faith

and fair dealing,” Count 6 of Appellants’ complaint must be dismissed with

prejudice. Erie Insurance’s Preliminary Objections, 12/3/10, at 3; Pa.R.C.P.

1028(a)(4). Second, Erie Insurance contended that Appellants’ negligence

claim must be dismissed with prejudice, as it was barred by the gist of the

action doctrine.   Erie Insurance’s Preliminary Objections, 12/3/10, at 4;

Pa.R.C.P. 1028(a)(4). Finally, Erie Insurance filed a preliminary objection in

the nature of a motion to strike Appellants’ demand for a jury trial, as

pleaded within Count 5 (bad faith) of Appellants’ complaint. Erie Insurance’s

Preliminary Objections, 12/3/10, at 6-7; Pa.R.C.P. 1028(a)(2).

      Rudick Engineering filed a companion set of preliminary objections

and, within this pleading, also raised three grounds for relief. First, Rudick

Engineering filed a preliminary objection in the nature of a motion to strike

Appellants’ demands for punitive damages. Rudick Engineering’s Amended

Preliminary Objections, 2/10/11, at 1; Pa.R.C.P. 1028(a)(2).     According to

Rudick Engineering, “[even i]f proven, the allegations in [Appellants’]

complaint describe nothing more than negligence” and, thus, the allegations

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could not support the award of punitive damages. Rudick Engineering’s Brief

in Support of Amended Preliminary Objections, 2/10/11, at 4.            Rudick

Engineering’s second preliminary objection was in the nature of a demurrer

and claimed that Appellants’ breach of contract claim (Count 8) must be

dismissed, as there was no contract between Appellants and Rudick

Engineering.      Rudick   Engineering’s   Amended   Preliminary   Objections,

2/10/11, at 1; Pa.R.C.P. 1028(a)(4).       Finally, Rudick Engineering filed a

preliminary objection in the nature of a motion to strike the entirety of

Appellants’ professional liability claim (Count 10).     Rudick Engineering’s

Amended Preliminary Objections, 2/10/11, at 1; Pa.R.C.P. 1028(a)(2).

Rudick Engineering noted that Appellants failed to attach a certificate of

merit to their complaint.     According to Rudick Engineering, this failure

violated Pennsylvania Rule of Civil Procedure 1042.3 and required that the

professional liability claim be stricken.     Rudick Engineering’s Amended

Preliminary Objections, 2/10/11, at 1-2.

      Appellants responded to the preliminary objections and also filed a

“Motion to Extend Time for Filing Certificate of Merit.”     Within the latter

filing, Appellants contended that a certificate of merit was unnecessary in

their case.    However, Appellants declared that – if the trial court were to

determine that a certificate of merit was necessary – Appellants requested

the trial court to grant them a 60-day extension for filing the certificate of

merit. Motion to Extend Time for Filing Certificate of Merit, 1/27/11, at 1-3.

                                     -8-
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       Following a consolidated oral argument, the trial court ruled upon both

sets of preliminary objections in an opinion and order entered May 25,

2011.4    With respect to Erie Insurance’s preliminary objections, the trial

court sustained the preliminary objections in total.          Thus, the trial court

dismissed Count 6 (breach of covenant of good faith and fair dealing) and

Count 7 (negligence) of Appellants’ complaint with prejudice.            Moreover,

with respect to Count 5 (bad faith), the trial court ordered that Appellants’

demand for a jury trial be stricken.5            Trial Court Order, 5/25/11, at 1.

Within this same May 25, 2011 order, the trial court sustained in part and

overruled in part Rudick Engineering’s preliminary objections.         Specifically,

the trial court: sustained the objection to strike the demands for punitive

damages against Rudick Engineering; sustained the objection to strike Count

10 (noting that Appellants’ professional liability claim was dismissed with

prejudice); and, overruled the demurrer to the breach of contract claim. Id.

____________________________________________

4
   The trial court’s opinion and order was time-stamped by the McKean
County Prothonotary and Clerk of Courts on May 24, 2011. However, on the
trial court’s order, the prothonotary wrote that notice of the docketing was
sent to the parties on May 25, 2011. Thus, the order was entered on May
25, 2011. Reeves v. Middletown Athletic Ass’n, 866 A.2d 1115, 1120
(Pa. Super. 2004) (“an order is ‘entered’ when it has been docketed and
notice of the docketing has been given to the parties”).
5
  Appellants agreed that Count 6 should be dismissed and “stipulate[d] that
their jury trial demand [did] not extend to their [Count 5 (bad faith)] claim.”
Appellants’ Answer to Erie Insurance’s Preliminary Objections, 12/17/10, at
¶¶ 19 and 33.

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      As can be discerned from the above, the trial court’s May 25, 2011

order did not “dispose[] of all claims and of all parties” and, thus, the order

was not final and appealable.    See Pa.R.A.P. 341(a) and (b)(1).      Indeed,

Appellants still had viable claims against all parties to the litigation.

Appellants, however, desired to immediately appeal the May 25, 2011 order.

Therefore, on June 15, 2011, Appellants filed with the trial court an

“Application for Determination of Finality of Order in Accordance with

Pa.R.A.P. 341(c)” (hereinafter “Appellants’ Application for Determination of

Finality”).   Relying upon Pennsylvania Rule of Appellate Procedure 341(c),

Appellants requested that the trial court amend its May 25, 2011 order and

make an “express determination that an immediate appeal would facilitate

resolution of the entire case.” Appellants’ Application for Determination of

Finality, 6/15/11, at 3; Pa.R.A.P. 341(c). Pursuant to Pa.R.A.P. 341(c), such

amendment would cause the order to become final and “appealable when

entered.” Pa.R.A.P. 341(c).

      The trial court acceded to Appellants’ request and, in an order dated

June 24, 2011, the trial court amended its May 25, 2011 order to declare:

“[t]his is a [f]inal [o]rder because the [c]ourt expressly determines that an

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immediate appeal would facilitate the resolution of the entire case.”      Trial

Court Order, 6/27/11, at 1.6

       Appellants filed a timely notice of appeal and Appellants raised the

following claims to this Court:7

         1. Does the “gist of the action” doctrine bar [Appellants’]
         recovery on their negligence claim against Erie Insurance . .
         . where that claim is not based on the insurance contract
         itself, but rather, upon independent affirmative acts and
         omissions by the [i]nsurer and its expert agent/contractor
         in summarily dismissing, without analysis, that mold
         infestation at their home was not dangerous?

         2. Where [Appellants] alleged wanton, willful and reckless
         conduct by representatives of Rudick [Engineering] . . . in
         summarily dismissing, without analysis, that the mold
         infestation at their home was not dangerous, was it error for
         the [t]rial [c]ourt to dismiss [Appellants’] punitive damage
         claim at the pleading stage?

         3. Where [Pa.R.C.P. 1042.1 et seq.] requires only a patient
         or client of a negligent professional to file a certificate of
         merit, did the [t]rial [c]ourt improperly dismiss [Appellants’]
         professional negligence claim against Rudick [Engineering]
         under circumstances in which [Appellants] were neither
         patients nor clients of Rudick [Engineering], but rather
____________________________________________

6
  Pa.R.A.P. 341(c) demands that the trial court “act” on an application for a
determination of finality “within 30 days of entry of the order.” Pa.R.A.P.
341(c)(1). As this Court has explained, the trial court entered its original
order on May 25, 2011. See supra n.5. The trial court then “acted” on
Appellants’ application for determination of finality – i.e. signed the amended
order – on June 24, 2011. Since June 24, 2011 was the 30 th day following
entry of the original order, the trial court’s certification was timely.
7
  The trial court ordered Appellants to file a concise statement of errors
complained of on appeal, pursuant to Pennsylvania Rule of Appellate
Procedure 1925(b). Appellants timely complied and preserved the four
issues currently raised before this Court.

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        third-party beneficiaries of a contract between Rudick
        [Engineering] and Erie [Insurance]?

        4. Did the [t]rial [c]ourt abuse its discretion where it
        refused to grant leave of court for [Appellants] to amend
        their [c]omplaint to replead their punitive damage claim and
        to extend the time for filing their [c]ertificate of [m]erit
        against Rudick [Engineering], where the case was in the
        pleading stage, the requests were timely, no party would be
        prejudiced and [Appellants] reasonably believed that they
        were not required to file a [c]ertificate of [m]erit based on
        the plain language of the Rule?

Appellants’ Brief at 6-7.

      When the appeal first came before this Court, we affirmed the trial

court’s order in part, vacated the order in part, and remanded the case.

Specifically, we held: 1) that the trial court properly dismissed Appellants’

negligence claim against Erie Insurance because the gist of the action

doctrine barred Appellants’ negligence claim; 2) that the trial court properly

dismissed Appellants’ punitive damages claim against Rudick Engineering

because Appellants did not plead sufficient facts to support an award of

punitive damages; 3) that the trial court erred when it denied Appellants’

motion for leave to amend their complaint, to properly plead their

entitlement to punitive damages; and, 4) that the trial court properly

dismissed   Appellants’     professional   negligence   claim   against   Rudick

Engineering, as Appellants failed to file a certificate of merit. Bruno v. Erie

Ins. Co., 55 A.3d 131 (Pa. Super. 2012) (unpublished memorandum) at 13-

29.

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      Following our decision, Appellants filed a petition for allowance of

appeal with our Supreme Court, wherein they raised the following issues:

          1. Does the “gist of the action” doctrine bar recovery on
          [Appellants’] negligence claim against Erie Insurance []
          where their claim was not based on the underlying
          insurance contract or [Erie Insurance’s] obligations
          thereunder, but instead upon independent, affirmative, and
          gratuitous acts and omissions of [Erie Insurance] and its
          expert agent/ contractor when they summarily and without
          analysis or testing told Mr. Bruno that the mold infestation
          in the home was not dangerous and described the dangers
          of mold as a media exaggeration?

          2. In promulgating Rule 1042.1 et seq. of the Pennsylvania
          Rules of Civil Procedure, did [the Pennsylvania Supreme
          Court], by the plain language used, require that only
          patients or clients of a negligent professional be obligated to
          file a Certificate of Merit, and was it therefore error for the
          Courts below to dismiss [Appellants’] professional
          negligence claim against [Rudick Engineering], because
          they were neither patients nor clients of [Rudick
          Engineering]?

See Bruno v. Erie Ins. Co., 74 A.3d 1027 (Pa. 2013).

      Our Supreme Court granted Appellants’ petition for allowance of

appeal and, in its opinion, the Supreme Court reversed this Court on both

issues.   First, the Supreme Court held “that [Appellants’] negligence claim

was not barred by the gist of the action doctrine, as the claim was based on

an alleged breach of a social duty imposed by the law of torts, and not a

breach of a duty created by the underlying contract of insurance.” Bruno v.

Erie Ins. Co., 106 A.3d 48, 50-51 (Pa. 2014). In arriving at this conclusion,

our Supreme Court reasoned:

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       The homeowners’ policy required Erie [Insurance] to pay up
       to $5,000 to [Appellants], when their home sustained a
       direct physical loss as the result of mold, for the cost of:
       (1) removing the mold, including tearing out or replacing
       parts of the property in order to gain access to the mold;
       (2) testing the air inside the property, or the property itself,
       to confirm the presence of mold; and (3) any increased
       expenses incurred by [Appellants] to maintain their
       standard of living, if the subject property was rendered
       uninhabitable by the mold. [Appellants’] claim against Erie
       [Insurance] for its alleged actions at issue in this appeal,
       quite simply, is not based on [Erie Insurance’s] violation of
       any of these contractual commitments. [Appellants] do not
       allege that Erie [Insurance] failed to pay the $5,000 it was
       obliged to pay by the policy for the costs of testing and
       remediation of damage to the property, and, indeed, the
       parties agree that Erie [Insurance] did, in fact, pay
       [Appellants] the $5,000 it owed under the policy for these
       purposes.

       Instead, [Appellants’] claim against Erie [Insurance] is
       predicated on the allegedly negligent actions taken by its
       agents on behalf of Erie [Insurance] while they were
       performing [Erie Insurance’s] contractual obligation to
       investigate the claim made by [Appellants] under their
       policy in order to determine if the mold discovery triggered
       any of [Erie Insurance’s] aforementioned payment
       obligations. Specifically, as recounted supra, [Appellants]
       asserted in their complaint that [Erie Insurance’s] agents,
       while conducting the claim investigation, were negligent for:
       rendering unfounded advice to [Appellants] that the mold
       was “harmless,” denying the potential for adverse human
       health consequences posed by [Appellants’] exposure to the
       mold; and telling them that they “should continue tearing
       out the existing paneling.” [Appellants] further aver that,
       because of this advice and recommendation, they
       proceeded with the removal of the basement paneling,
       which later led to them suffering health problems from the
       mold exposure, and their entire house being rendered
       uninhabitable such that it had to be destroyed.

       Accordingly, while Erie [Insurance] had contractual
       obligations under its policy to investigate whether mold was
       present, and also to pay for all property damage caused by

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        mold, the substance of [Appellants’] allegations is not that it
        failed to meet these obligations; rather, it is that Erie
        [Insurance], during the course of fulfilling these obligations
        through the actions of its agents, acted in a negligent
        manner by making false assurances regarding the toxicity of
        the mold and affirmatively recommending to [Appellants]
        that they continue their renovation efforts, which caused
        them to suffer physical harm because of their reasonable
        reliance on those assurances.          Consequently, these
        allegations of negligence facially concern [Erie Insurance’s]
        alleged breach of a general social duty, not a breach of any
        duty created by the insurance policy itself. The policy in
        this instance merely served as the vehicle which established
        the relationship between [Appellants] and Erie [Insurance],
        during the existence of which Erie [Insurance] allegedly
        committed a tort.

Id. at 70-71 (internal citations omitted) (emphasis in original).

      Further, with respect to Appellants’ second claim on appeal, the

Supreme Court held that “[Appellants] were not required to obtain a

certificate of merit in order to proceed with their negligence suit against the

professional engineer, since they were not patients or clients of the

engineering company which employed him.” Id. at 50-51.

      The Supreme Court thus reversed our order. However, the Supreme

Court remanded the case to this Court, so that we could consider whether

Appellants’ negligence claim against Erie Insurance is “otherwise legally

cognizable.”   Id. at 71.     We conclude that, as pleaded in Appellants’

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complaint, Appellants’ negligence claim is cognizable under Sections 323 and

324A of the Restatement (Second) of Torts.8

       We have stated:

         A preliminary objection in the nature of a demurrer is
         properly [sustained] 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 reasonably
         deducible therefrom must be admitted as true.

         In determining whether the trial court properly sustained
         preliminary objections, the appellate court must examine
         the averments in the complaint, together with the
         documents and exhibits attached thereto, in order to
         evaluate the sufficiency of the facts averred. The impetus
____________________________________________

8
  Within Erie Insurance’s brief to this Court on remand, Erie Insurance notes
that, in our original memorandum, we declared that Appellants’ claim was
not independently cognizable under Section 323 of the Restatement
(Second) of Torts. Erie Insurance’s Brief at 14; see also Bruno v. Erie
Ins. Co., 55 A.3d 131 (Pa. Super. 2012) (unpublished memorandum) at 18.
Our earlier ruling was based upon our conclusion that the claims pleaded in
Appellants’ complaint were contractual in nature – and not tortious;
therefore, the gist of the action doctrine subsumed Appellants’ negligence
claims. Id.        However, our Supreme Court later held that Appellants’
“negligence claim was not barred by the gist of the action doctrine, as the
claim was based on an alleged breach of a social duty imposed by the law of
torts, and not a breach of a duty created by the underlying contract of
insurance.” Bruno, 106 A.3d at 50-51. Specifically, our Supreme Court
held, Appellants’ complaint pleaded that “Erie [Insurance], during the course
of fulfilling [its contractual] obligations through the actions of its agents,
acted in a negligent manner by making false assurances regarding the
toxicity of the mold and affirmatively recommending to [Appellants] that
they continue their renovation efforts, which caused them to suffer physical
harm because of their reasonable reliance on those assurances.” Id. at 70-
71.

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        of our inquiry is to determine the legal sufficiency of the
        complaint and whether the pleading would permit recovery
        if ultimately proven. This Court will reverse the trial court’s
        decision regarding preliminary objections only where there
        has been an error of law or abuse of discretion. When
        sustaining the [preliminary objections] will result in the
        denial of claim or a dismissal of suit, [the preliminary
        objections may be sustained] only where the case [is] free
        and clear of doubt.

Lugo v. Farmers Pride, Inc., 967 A.2d 963, 966 (Pa. Super. 2009)

(internal citations, quotations, and corrections omitted).

      Section 323 of the Restatement (Second) of Torts is entitled “negligent

performance of undertaking to render services” and provides:

        One who undertakes, gratuitously or for consideration, to
        render services to another which he should recognize as
        necessary for the protection of the other’s person or things,
        is subject to liability to the other for physical harm resulting
        from his failure to exercise reasonable care to perform his
        undertaking, if

            (a) his failure to exercise such care increases the risk of
            such harm, or

            (b) the harm is suffered because of the other’s reliance
            upon the undertaking.

Restatement (Second) of Torts § 323; see also DeJesus v. Liberty Mut.

Ins. Co., 223 A.2d 849 (Pa. 1966) (adopting section 323 of the Restatement

(Second) of Torts). As the comment to section 323 explains,

        Section [323] applies to any undertaking to render services
        to another which the defendant should recognize as
        necessary for the protection of the other’s person or things.
        It applies whether the harm to the other or his things
        results from the defendant’s negligent conduct in the
        manner of his performance of the undertaking, or from his

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          failure to exercise reasonable care to complete it or to
          protect the other when he discontinues it.

Restatement (Second) of Torts § 323 cmt.

        Section 324A of the Second Restatement of Torts is entitled “liability to

third person for negligent performance of undertaking;” it declares:

          One who undertakes, gratuitously or for consideration, to
          render services to another which he should recognize as
          necessary for the protection of a third person or his things,
          is subject to liability to the third person for physical harm
          resulting from his failure to exercise reasonable care to
          protect his undertaking, if

              (a) his failure to exercise reasonable care increases the
              risk of such harm, or

              (b) he has undertaken to perform a duty owed by the
              other to the third person, or

              (c) the harm is suffered because of reliance of the other
              or the third person upon the undertaking.

Restatement (Second) of Torts § 324A.

        The comment to Section 324A explains that the rule “parallels the one

stated in § 323, as to the liability of the actor to the one to whom he has

undertaken to render services.       [Section 324A] deals with the liability to

third persons.” Restatement (Second) of Torts § 324A cmt.

        As our Supreme Court ably summarized, Appellants’ complaint pleaded

that:

          Erie [Insurance], during the course of fulfilling [its
          contractual] obligations through the actions of its agents,
          acted in a negligent manner by making false assurances [to
          David Bruno] regarding the toxicity of the mold and
          affirmatively recommending to [Appellants] that they

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          continue their renovation efforts, which caused them to
          suffer physical harm because of their reasonable reliance on
          those assurances.

Bruno, 106 A.3d at 70-71.

        As to David Bruno, the above allegations state a claim for negligence

under Section 323 and, as to Angela Bruno, Anthony Gotti Bruno, and

McKayla Marie Blake, the above allegations state a claim for negligence

under Section 324A. Appellants’ complaint pleaded that (through its agent)

Erie Insurance:    voluntarily “undertook to render services to” David Bruno

(since Erie Insurance voluntarily and affirmatively took on the duty to advise

David    Bruno    “regarding   the   toxicity   of   the    mold     and   affirmatively

recommending to [Appellants] that they continue their renovation efforts”);

Erie Insurance should have “recognize[d] [that the services were] necessary

for the protection of” David Bruno and his family (since the advice was

voluntarily   rendered   by    individuals   who     were    hired    to   analyze   the

homeowners’ mold, given to the layperson homeowners, and concerned an

alleged toxic substance in their home); Erie Insurance allegedly failed to

exercise reasonable care when it provided the advice; and, Appellants

suffered physical harm as a result of Erie Insurance’s breach (in that Erie

Insurance’s alleged “failure to exercise [reasonable] care increase[d] the risk

of [Appellants’] harm” and “the harm [Appellants] suffered [was because of

their] reliance upon [Erie Insurance’s] undertaking.”                See Restatement

(Second) of Torts §§ 323 and 324A(a) and (c).

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       Therefore, since Appellants’ negligence claim against Erie Insurance is

“otherwise legally cognizable,” we vacate the trial court’s order and remand

for further proceedings.9

       Order vacated. Case remanded. Jurisdiction relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 7/22/2015

____________________________________________

9
  In Bruno, our Supreme Court held that “[Appellants] were not required to
obtain a certificate of merit in order to proceed with their negligence suit
against the professional engineer, since they were not patients or clients of
the engineering company which employed him.” Bruno, 106 A.3d at 51.
Hence, we vacate the portion of the trial court’s order which dismissed
Appellants’ professional negligence claim against Rudick Engineering.

We further note that the parties did not appeal our earlier determinations:
1) that the trial court properly dismissed Appellants’ punitive damages claim
against Rudick Engineering because Appellants did not plead sufficient facts
to support an award of punitive damages, but 2) that the trial court erred
when it denied Appellants’ motion for leave to amend their complaint, to
properly plead their entitlement to punitive damages. See Bruno v. Erie
Ins. Co., 55 A.3d 131 (Pa. Super. 2012) (unpublished memorandum) at 13-
29. Thus, our earlier determinations remain undisturbed in the wake of our
Supreme Court’s opinion in Bruno.

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