In Bruno v. Erie Insurance, the plaintiffs discovered black mold in their home and submitted a claim under their homeowners' insurance policy with Erie Insurance for mold remediation coverage. An Erie claims adjuster inspected the home with the assistance of a forensic engineer retained by Erie. They allegedly represented to the homeowners that the dangers of black mold were overstated in popular media and that the mold in plaintiffs' home was "harmless." The plaintiffs continued to live in the home in reliance of these representations before developing serious medical complications allegedly attributable to the mold.
After a lengthy appeals process, the Pennsylvania Supreme Court ultimately determined that the homeowners could sue Erie in tort for negligence committed by the adjuster during the claims investigation process. In so holding, the court distinguished duties created by contract from those existing independently as a social duty. Further, the Supreme Court held that the homeowners could sue the engineering consultant retained by the insurance company to evaluate the mold even though the homeowners did not have a direct contractual relationship with the engineering firm. Finally, the court determined that the homeowners did not need a certificate of merit to support a professional negligence claim against the engineer.
Courts have traditionally jumped at the opportunity to dismiss cases/claims where actions in tort arise from a relationship created/governed by a written agreement. The Bruno decision sets a new and decidedly pro-plaintiff course by making it clear that tort and contract claims may now coexist in a way that they may not have existed before. Contracting parties should be aware that their actions and conduct in the performance of an agreement may be subjected to heightened scrutiny in the future, and may expose them to additional damages other than those set forth in the agreement. This decision may have widespread implications for insurance companies, lenders, construction contractors, engineers, real estate agents and design professionals, among others.
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