Bennett v. A.P. Masterpiece Homes - Superior Court - March 6, 2012
http://www.pacourts.us/OpPosting/Superior/out/a03006_12.pdf
Held: Plaintiff in a consumer protection case alleging misleading or deceptive conduct need not plead or prove elements of common law fraud, reversing a line of contrary Superior Court decisions.
The UTPCPL provides a private right of action for anyone who “suffers any ascertainable loss of money or property” as a result of an unlawful method, act or practice. 73 P.S. § 201-9.2(a).
Section 201-2(4) lists twenty enumerated practices which constitute actionable “unfair methods of competition” or “unfair or deceptive acts or practices.” 73 P.S. § 201-2(4)(i)-(xx). The UTPCPL also contains a catchall provision at 73 P.S. § 201-2(4)(xxi).
The pre-1996 catchall provision prohibited “fraudulent conduct” that created a likelihood of confusion or misunderstanding. 73 P.S. § 201-2(4)(xvii). In 1996, the General Assembly amended the UTPCPL and revised Section 201-2(4)(xxi) to add “deceptive conduct” as a prohibited practice. Act of Dec. 4, 1996, P.L. 906, No. 146, § 1 (effective Feb. 2, 1997). The current catchall provision proscribes “fraudulent or deceptive conduct which creates a likelihood of confusion or of misunderstanding.” 73 P.S. § 201-2(4)(xxi) (emphasis added).
Under this "catchall" provision, a plaintiff does not need to allege or prove common law fraud. The court rejected its own decisions which continued to apply pre-amendment law that required pleading and proving the element of fraud, such as. Ross v. Foremost Ins. Co., 998 A.2d 648 (Pa.Super. 2010) (stating catchall section requires proof of common law fraud); Colaizzi v. Beck, 895 A.2d 36 (Pa.Super. 2006) (stating same); Booze v. Allstate Ins. Co., 750 A.2d 877 (Pa.Super. 2000), appeal denied, 564 Pa. 722, 766 A.2d 1242 (2000) (stating same); Skurnowicz v. Lucci, 798 A.2d 788 (Pa.Super. 2002) . Despite the addition of language regarding deceptive conduct, these post-amendment cases do not discuss the 1996 amendment in any detail, or consider what effect it might have on the catchall provision.
Commonwealth Court decisions - The Superior Court adopted the holding in the contrary line of case from Commonwealth Court. See, e.g., Commonwealth v. Percudani, 825 A.2d 743, 746-47 (Pa.Cmwlth. 2003) (holding 1996 Amendment to Section 201-2(4)(xxi) provides liability for deceptive conduct). These cases view the 1996 addition of “deceptive conduct” as substantively altering the catchall provision and allowing for liability based on the less restrictive standard of “deceptive conduct.” Com. ex rel. Corbett v. Manson, 903 A.2d 69, 74 (Pa.Cmwlth. 2006) (permitting catchall liability for deceptive conduct and rejecting Superior Court’s continued interpretation of Section 201-2(4)(xxi) as requiring proof of common law fraud). See also Com. v. TAP Pharmaceutical Products, Inc., ___ A.3d ___, 2011 WL 4056170 (Pa.Cmwlth. 2011) (stating Commonwealth Court has adopted “deceptive” standard under post-amendment catchall section of UTPCPL because language of 1996 amendment signaled approval of less restrictive pleading requirements); Pennsylvania Dept. of Banking v. NCAS of Delaware, LLC, 995 A.2d 422, 433 n.28 (Pa.Cmwlth. 2010) (applying “deceptive” standard for catchall provision and outlining split in interpretations of statute by Commonwealth and Superior Courts). In rejecting this Court’s postamendment interpretation of the catchall provision, the Commonwealth Court found Skurnowicz inapplicable to post-amendment cases because Skurnowicz did not acknowledge the 1996 amendment and relied on preamendment case law to hold the catchall section required proof of common law fraud.
Federal court decisions - Most Pennsylvania federal courts similarly concluded the 1996 amendment lessened the degree of proof required under the UTPCPL catchall provision. See Schnell v. Bank of New York Mellon, ___ F.Supp.2d ___, 2011 WL 5865966 (E.D.Pa. Nov. 22, 2011) (stating deceptive conduct is sufficient to satisfy catchall provision); Vassalotti v. Wells Fargo Bank, N.A., 732 F.Supp.2d 503, 510 n.7 (E.D.Pa. 2010) ; Wilson v. Parisi, 549 F.Supp.2d 637 (M.D.Pa. 2008); Chiles v. Ameriquest Mortg. Co., 551 F.Supp.2d 393, 398-99 (E.D.Pa. 2008). Like the Commonwealth Court, the federal courts examining this issue were persuaded by the revised statutory language of the catchall provision and our Supreme Court’s directive to read the UTPCPL broadly. Seldon v. Home Loan Services, Inc., 647 F.Supp.2d 451, 469 (E.D.Pa. 2009). Accord Genter v. Allstate Property and Cas. Ins. Co., 2011 WL 2533075 (W.D.Pa. June 24, 2011); Haines v. State Auto Property and Cas. Ins. Co., 2009 WL 1767534 (E.D.Pa. June 22, 2009); Flores v. Shapiro & Kreisman, 246 F.Supp.2d 427 (E.D.Pa. 2002); In re Patterson, 263 B.R. 82 (Bankr.E.D.Pa. 2001). Federal court generally declined to follow the Superior Court’s post-Amendment precedent because the Superior Court cases relied on pre-amendment interpretations of the catchall section without acknowledging the 1996 amendment. Seldon, supra at 469; Cohen v. Chicago Title Ins. Co., 242 F.R.D. 295 (E.D.Pa. 2007) (rejecting post-amendment cases from Superior Court because they rely on authority that interpreted preamendment catchall provision).
