Gregg, G. v. Ameriprise Financial , 195 A.3d 930 ( 2018 )

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2018 PA Super 252GARY L. GREGG AND MARY E. GREGG IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellee
v.
AMERIPRISE FINANCIAL, INC.,
AMERIPRISE FINANCIAL SERVICES,
INC., RIVERSOURCE LIFE INSURANCE
COMPANY AND ROBERT A. KOVALCHIK,
Appellants No. 1504 WDA 2017
Appeal from the Order Entered, September 20, 2017,
in the Court of Common Pleas of Allegheny County,
Civil Division at No(s): G.D 01-006611.
BEFORE: OTT, J., KUNSELMAN, J. and MUSMANNO, J.
OPINION BY KUNSELMAN, J.: FILED SEPTEMBER 12, 2018
Introduction
Ameriprise Financial, Inc.; Ameriprise Financial Services, Inc.;
Riversource Life Insurance Company; and Robert A. Kovalchik (“the
insurance companies”) appeal a non-jury verdict finding that they deceitfully
profited from a business transaction with Gary and Mary Gregg. The trial
judge held the insurance companies in violation of the “catchall” provision of
Pennsylvania’s Uniform Trade Practices and Consumer Protection Law
(UTPCPL).1 That catchall provision prohibits anyone who advertises, sales,
or distributes goods or services from “[e]ngaging in any . . . fraudulent or
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1 73 P.S. § 201-1 et seq.
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deceptive conduct which creates a likelihood of confusion or of
misunderstanding” during a transaction. 73 P.S. § 201-2(4)(xxi).
A decade ago, our appellate courts disagreed over that provision. The
Commonwealth Court of Pennsylvania, interpreting it expansively, granted
consumers greater protections under the UTPCPL than under common law,
while this Court did not. After studying Commonwealth Court and federal
precedents, we realized we had inadvertently reduced a 1996 amendment’s
impact. Thus, in Bennett v. A.T. Masterpiece Homes, 40 A.3d 145 (Pa.
Super. 2012), we adopted Commonwealth Court’s consumer-friendly view of
the catchall provision.
In the case at bar, the insurance companies would essentially have us
undo Bennett. They argue that a jury verdict in their favor on common law
claims precluded a non-jury verdict against them under the UTPCPL. The
Commonwealth Court rejected that argument in 2011. Hence, the insurance
companies invite us to reopen the split in authority that Bennett repaired.
We decline their invitation and affirm.
Factual Background
In 1999, Robert A. Kovalchik, a financial adviser and insurance
salesperson, solicited the Greggs to become his new customers. The Greggs
and Mr. Kovalchik knew each other, because Mr. Kovalchik had advised Mr.
Gregg's mother and sold her financial products, including insurance.
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At his first formal meeting with the Greggs, Mr. Kovalchik held himself
out as having skill, training, and expertise in insurance and investment
products. Mr. Kovalchik offered to review the Greggs’ assets, liabilities,
financial worth, investments, and goals. He said that he would advise and
counsel them as to insurance or investment products, that they should rely
upon his advice and counsel, that they could trust him to achieve their
financial goals, and that they should delegate investment decisions to him.
Mr. Kovalchik also asked the Greggs a series of questions regarding
their current life insurance protection, financial needs, retirement goals, and
current financial situation. The Greggs revealed that they owned seven
Prudential life insurance policies. Those Prudential Policies had a combined
value of $121,000.
Mr. Kovalchik and the Greggs met a second time, when Mr. Kovalchik
recommended various insurance and investment products to them. Based
upon his review and analysis, Mr. Kovalchik advised the Greggs to liquidate
their $121,000 Prudential Polices, so he could place the assets into IDS Life
Insurance, a corporation that the appellant insurance companies eventually
acquired.
During his sales pitch, Mr. Kovalchik told the Greggs to purchase a
new $170,000 Flexible Premium Variable Life Insurance Policy for Mr. Gregg
and a $75,000 spousal rider for Mrs. Gregg. Mr. Kovalchik also
recommended that they surrender their existing IRAs and use those funds to
purchase IRAs through IDS. Mr. Kovalchik then advised them not to enroll
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Mrs. Gregg into an Air Force-provided plan that would have paid her military
benefits if Mr. Gregg died, because the insurance companies would provide
better coverage at lower costs.
Mr. Kovalchik presented the Greggs with a "Life Insurance Illustration"
to demonstrate that, if Mr. Gregg purchased the new $170,000 Flexible
Premium Variable Life Insurance Policy through IDS Life (“the IDS Policy”)
and made annual payments of $1,671, the Greggs could expect the IDS
Policy to accrue significant cash value. As a result, he led the Greggs to
believe that they could use that policy as their retirement plan.
The Greggs believed him and signed an application to purchase the
IDS Policy. The Greggs also agreed to “roll-over” their existing IRAs into
IRAs with IDS. Mr. Kovalchik directed them to surrender the proceeds from
their Prudential Policies to fund the IDS Policy. The Greggs did so.
In December 1999, the Greggs provided Mr. Kovalchik with a $300
check, because he told them that the money would increase the savings
portion of the IDS Policy. The Greggs also authorized automatic withdrawal
of $300 per month from their checking account to cover the savings portion
of the IDS Policy.
IDS issued them the IDS Policy.
A few weeks later, Prudential sent several checks to IDS from the
now-liquidated Prudential Policies; $13,600.60 went into the IDS Policy.
Unbeknownst to the Greggs, however, Mr. Kovalchik began dividing their
monthly $300 contributions between the IDS Policy and the two IRAs.
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Also, despite Mr. Kovalchik’s original plan for all Prudential Policy funds
to go into the IDS Policy, this was not possible. Thus, Prudential sent an
$11,601.34 check for the remainder directly to the Greggs.
When Mr. Kovalchik learned this, he contacted the Greggs to offer
them additional products. He told them he would deposit approximately
$9,500 of $11,601.34 into their IDS Policy. Instead, he put $1,700 into
each of their new IRAs.
In June 2000, Mr. Kovalchik opened an AXP Growth Fund account for
the Greggs and deposited $6,100 of the Prudential Polices’ proceeds into
that account. Thus, he never invested any of the $9,500 into the IDS Policy.
In addition, each IRA transactions increased Mr. Kovalchik’s commissions via
a surcharge of 5.75%.
Next, the Greggs began sending Mr. Kovalchik $200 per month, which
they believed were going to the IDS Policy. However, Mr. Kovalchik actually
put the money in the AXP Growth Account. Every AXP Growth Fund deposit
increased Mr. Kovalchik's commissions, because they all carried the 5.75%
surcharge.
The Greggs received a class action notice in January 2001, which led
them to believe that the insurance companies broke the law. They sued.
Among other things, the Greggs alleged fraudulent misrepresentation,
negligent misrepresentation, and violation of the UTPCPL’s catchall provision.
The common law claims of fraudulent and negligent misrepresentation
went to a jury, which returned defense verdicts on both counts. Relying
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upon the record from the jury trial, the judge made the following findings of
fact:
this court finds that [the insurance companies’] conduct
created a likelihood of confusion or misunderstanding in
their dealings with the [Greggs]. Even if the financial
advisor did not directly misrepresent the cost of the life
insurance policy, he failed to clearly and fully explain the
cost and terms of the policy; and the [Greggs] reasonably
believed they would not have to pay additional monies to
fund the policy once their existing policies were transferred
to the [insurance companies]. Additionally, the [Greggs]
relied upon the [insurance companies] to their financial
detriment when they elected to forgo the purchase of the
survivor benefit option for Mr. Gregg's military pension,
and instead cashed-in their whole life policies to purchase
the variable life insurance policy recommended by [Mr.
Kovalchik]. This court found the [Greggs]' testimony to be
credible on these issues; and the [Greggs] proved all
elements of their UTPCPL claim by a preponderance of the
evidence.
Trial Court Memorandum Order, 12/7/14, at 2-3.
The trial judge then awarded $52,431.29 in UTPCPL damages to the
Greggs. The judge arrived at that figure by refunding the premium that the
Greggs had paid to the insurance companies, plus 6% interest, minus the
$12,151.13 that the insurance companies had already paid the Greggs in
September 2012. He also ordered the insurance companies to pay the
Greggs’ legal bills and costs of $69,421.26 and $12,065.88, respectively.
Both sides filed post-trial motions, which the trial court denied. Only
the insurance companies have appealed.
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They raise two issues. First, the insurance companies assert that the
jury’s verdict on the claims of common law misrepresentation required the
trial court to dismiss the Greggs’ UTPCPL claim. See Companies’ Brief at 4.
Also, they argue that the judge should have subtracted the value that the
Greggs received by having the IDS Policy in effect from 1999 to 2012 (even
though they never made a death-benefit claim) from the $52,431.29 he
awarded them. Id.Res Judicata & Collateral Estoppel
In their first argument, the insurance companies invoke the doctrines
of res judicata and collateral estoppel. They assert that, in order to win a
UTPCPL catchall claim, consumers must prove negligent misrepresentation
or fraudulent misrepresentation. Thus, when the jury found neither form of
misrepresentation, it simultaneously acquitted the insurance companies on
the UTPCPL count, as well. The insurance companies therefore believe that
the trial judge erred when he found them in violation of the UTPCPL.
Applying the doctrines of res judicata and “collateral estoppel . . .
presents a question of law. Like all questions of law, our standard of review
is de novo and our scope of review is plenary.” Skotnicki v. Insurance
Department, 175 A.3d 239, 247 (Pa. 2017).
Res judicata, Latin meaning “that which has been judged,” prohibits
parties from retrying a completed case. Thus, “an existing final judgment
rendered upon the merits, without fraud or collusion, by a court of
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competent jurisdiction, is conclusive of causes of action and of facts or
issues thereby litigated, as to the parties and their privies, in all other
actions in the same or any other judicial tribunal of concurrent jurisdiction.”
46 Am.Jur.2d, Judgments § 394 at 558-559. For res judicata to apply four
things must be identical between the old lawsuit and the new one: “(1)
identity of issues, (2) identity of causes of action, (3) identity of persons and
parties to the action, and (4) identity of the quality or capacity of the parties
suing or sued.” Day v. Volkswagenwerk Aktiengesellschaft, 464 A.2d
1313, 1316–1317 (Pa. Super. 1983).
The doctrine of collateral estoppel is similar to res judicata, but it does
not require both parties in the second lawsuit to be the same parties from
the first. “[C]ollateral estoppel is valid if, (1) the issue decided in the prior
adjudication was identical with the one presented in the later action, (2)
there was a final judgment on the merits, (3) the party against whom the
plea is asserted was a party or in privity with a party to the prior
adjudication, and (4) the party against whom it is asserted has had a full
and fair opportunity to litigate the issue in question in a prior action.” In re
Estate of R.L.L., 409 A.2d 321, 323 n. 8 (Pa. 1979). See also Gray v.
Buonopane, 53 A.3d 829, 835 n. 4 (Pa. Super. 2012).
Under either doctrine, all four elements must be present. Here, the
insurance companies invoke the doctrines to shield themselves from the trial
judge’s verdict. However, that shield provides no refuge, because the judge
and jury decided distinct issues.
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The insurance companies claim the issues are identical, because, they
think, “[t]o establish . . . deceptive conduct under the UTPCPL’s catchall
provision, the [consumer] must, at a minimum, prove . . . common law
negligent misrepresentation.” Companies’ Brief at 15. To support their
theory, the insurance companies cite Kirwin v. Sussman Automotive, 149
A.3d 333 (Pa. Super. 2016). Specifically, they offer this quote: “Deceptive
conduct ordinarily can only take one of two forms, either fraudulent or
negligent . . . The broadening of the UTPCPL . . . makes negligent
deception, e.g., negligent misrepresentations, actionable under the post-
1996 catchall provision.” Companies’ Brief at 19 (quoting Kirwin at 336).
The companies then correctly point out that, under Kirwin, the Greggs “can
establish a claim of misrepresentation under the UTPCPL’s catchall provision
by proving either a fraudulent misrepresentation or negligent
misrepresentation.” Id. at 19.
But the insurance companies attempt to transform that permissive
statement into a prohibitive one, by arguing that the Greggs could only
establish a UTPCPL catchall violation “by proving either a fraudulent
misrepresentation or negligent misrepresentation.” Id. As we will explain
below, we do not read the UTPCPL so narrowly.
Granted, the word “only” appears in the quote from Kirwin, which was
quoting Dixon v. Northwestern Mutual, 146 A.3d 780 (Pa. Super. 2016).
The full quote from Dixon is:
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[d]eceptive conduct ordinarily can only take one of two
forms, either fraudulent or negligent. As noted above, the
pre–1996 catchall provision covered only fraudulently
deceptive practices. The broadening of the UTPCPL so as
to not require fraud therefore ipso facto makes negligent
deception, e.g., negligent misrepresentations, actionable
under the post–1996 catchall provision.
Dixon at 790.
The issue in Dixon, however, was not whether negligent or fraudulent
conduct were the only deceptions that the catchall provision bans. Rather,
the question in Dixon was whether “a negligent misrepresentation can form
the basis of a UTPCPL claim.” Id. at 789. This Court concluded that it
could. Thus, the unexplained, introductory pronouncement that “[d]eceptive
conduct ordinarily can only take one of two forms, either fraudulent or
negligent” did not address the issue in Dixon and was, therefore, dictum.
Id. at 790 (emphasis added). For the reasons below, we disagree with that
dictum and decline to give it the force of law.
We turn to the UTPCPL’s language and the legislative history behind its
catchall provision for explanation.
Section 201-9.2 of the UTPCPL permits a consumer who purchases
goods or services to sue a vendor for engaging in unlawful conduct during a
business transaction.2 “Unlawful” acts are “[u]nfair methods of competition
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2 73 P.S. § 201-9.2 provides, in relevant part:
(a) Any person who purchases or leases goods or services
primarily for personal, family or household purposes and
(Footnote Continued Next Page)
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and unfair or deceptive acts or practices.” 73 P.S. § 201-3. The UTPCPL
initially lists 20 specific, unlawful acts; it then has a catchall provision. See
73 P.S. § 201-2(4). The catchall provision forbids vendors from “[e]ngaging
in any other fraudulent or deceptive conduct which creates a likelihood of
confusion or of misunderstanding.” 73 P.S. § 201-2(4)(xxi).
Originally, the catchall provision only banned “fraudulent conduct,” and
Pennsylvania courts interpreted this phrase as requiring proof of common
law fraud. See Prime Meats Inc. v. Yochim, 619 A.2d 769, 773 (Pa.
Super. 1993), appeal denied, 646 A.2d 1180 (Pa. 1994). The legislature
disapproved of this cramped reading. Thus, in 1996, it amended the catchall
provision by adding the phrase “or deceptive” to describe the prohibited
“conduct,” 73 P.S. § 201-2(4)(xxi), and expanded the UTPCPL’s protections
beyond fraudulent misrepresentation.
This Court, however, failed to respond to the General Assembly’s will.
Instead of expanding our reading of the catchall provision, we clung to our
pre-amendment view that consumers needed to prove fraud in order to
maintain a cause of action under Section 201-2(4)(xxi). See Ross v.
(Footnote Continued) _______________________
thereby suffers any ascertainable loss of money or
property, real or personal, as a result of the use or
employment by any person of a method, act or practice
declared unlawful by section 31 of this act, may bring a
private action to recover actual damages or one hundred
dollars ($100), whichever is greater.
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Foremost Ins. Co., 998 A.2d 648 (Pa. Super. 2010); Colaizzi v. Beck, 895
A.2d 36 (Pa. Super. 2006); Skurnowicz v. Lucci, 768 A.2d 788 (Pa. Super.
2002); and Booze v. Allstate Ins. Co., 750 A.2d 877 (Pa. Super. 2000),
appeal denied, 766 A.2d 1242 (Pa. 2000). We did this “without discussing
or even acknowledging the amended provisions.” Bennett v. A.T.
Masterpiece Homes, 40 A.3d 145, 155 (Pa. Super. 2012).
The Commonwealth Court, however, recognized the significance of the
1996 amendment.3 Our sister court noted that we had not accounted for the
amendment, reminded us that the Supreme Court of Pennsylvania wants the
UTPCPL liberally construed to advance the legislative goal of consumer
protection, and held that proof of fraudulent misrepresentation was not
needed to win “deceptive conduct” claims. Commonwealth v. Percudani,
825 A.2d 743 (Pa. Cmwlth. 2003). Percudani therefore marked a split of
authority between the Commonwealth Court, which applied a more liberal
interpretation of the catchall provision, and this Court, which adhered to our
pre-amendment demand for proof of fraud. That split lasted for nine years.
Then, in Bennett, supra, two families sued a construction company
for shoddily building their new homes. While charging the jury, the trial
judge disregarded our precedents that limited the UTPCPL catchall provision
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3 Commonwealth Court has original jurisdiction over UTPCPL claims when the
Attorney General of Pennsylvania brings a public enforcement action against
a vendor.
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to cases of fraud. Instead, he told the jury that they could find a catchall
violation if the defendants had engaged in any “misleading conduct.” Id. at
150. On appeal, we distinguished our post-amendment precedents on the
grounds that they had overlooked the 1996 amendment. Adopting the
Commonwealth Court’s logic from Percudani, we rejected the notion that
proof of common law fraud was needed to show a catchall violation and
affirmed. Thus, in Bennett, we reconciled our UTPCPL interpretation with
that of the Commonwealth Court.
Here, by asserting that a jury’s negligent misrepresentation verdict is
res judicata or collateral estoppel against a catchall claim in private causes
of action, the insurance companies would have us cleave a new split of
appellate authority in UTPCPL jurisprudence. In Commonwealth v. TAP
Pharmaceutical Products, Inc., 36 A.3d 1197 (Pa. Cmwlth. 2011),
reversed on other grounds, 94 A.3d 350 (Pa. 2014), the Commonwealth
Court held that a defense jury verdict on negligent misrepresentation is not
res judicata or collateral estoppel against a non-jury UTPCPL catchall claim.
Here, Court of Common Pleas Judge Michael F. Marmo, in his 1925(a)
Opinion, correctly explained why TAP applies to this case:
[t]he defendants in TAP argued that a trial court, when
considering a UTPCPL claim for deceptive conduct, is
bound by the decision of the jury on the plaintiffs’
fraudulent and negligent misrepresentation claims.
Similar to the jury’s decision in TAP, the jury in this
case answered “no” when asked whether [the insurance
companies] were liable for negligent misrepresentation.
The jury also answered “no” when asked whether [the
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insurance companies] were liable for fraudulent
misrepresentation. The jury did not answer any specific
questions regarding causation, reliance, financial harm, or
outrageous or deceptive conduct . . .
. . . The [insurance companies’] argument that [res
judicata and] collateral estoppel precludes this Court’s
award on the UTPCPL claim was rejected by . . . the
Commonwealth Court . . . in TAP. Thus, [the insurance
companies’] assertion that the jury’s verdict in its favor on
. . . fraudulent and negligent misrepresentation claims bars
[the Greggs] from recovering on [their] UTPCPL based
upon res judicata or collateral estoppel must fail.
In regards to [the] argument that a UTPCPL claim
cannot be sustained where the alleged conduct is a
misrepresentation, and such misrepresentation was not at
least negligent, [the insurance companies] fail to cite any
authority to support this argument. Contrary to [their]
assertion, the Commonwealth Court stated in TAP that the
test for deceptive conduct under the UTPCPL is “essentially
whether the conduct has the tendency or capacity to
deceive, which is a lesser, more relaxed standard than that
for fraud or negligent misrepresentation.” TAP, 36 A.3d at
1253.
Trial Court Opinion, 12/5/17, at 2-4.
We agree with the learned trial judge and the Commonwealth Court’s
reasoning in TAP. Had the General Assembly intended to limit the catchall
provision to cover only common law misrepresentation claims, it would have
done so in more direct language than “deceptive conduct.” 73 P.S. § 201-
2(4)(xxi). In the 1996 amendment, legislators could have prescribed only
“fraudulent or negligent conduct,” had they so intended. Instead, they
outlawed “any . . . deceptive conduct,” regardless of a vendor’s mental
state. Id. (emphasis added).
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Hence, any deceptive conduct, “which creates a likelihood of confusion
or of misunderstanding,” is actionable under 73 P.S. § 201-2(4)(xxi),
whether committed intentionally (as in a fraudulent misrepresentation),
carelessly (as in a negligent misrepresentation), or with the upmost care (as
in strict liability). Whether a vendor’s “conduct has the tendency or capacity
to deceive . . . is a lesser, more relaxed standard than that for fraud or
negligent misrepresentation.” TAP, 36 A.3d at 1253. The only thing more
relaxed than negligence – regarding a consumer’s burden of proof – is strict
liability.
The Commonwealth Court therefore went on to say that its post-
amendment precedents “have the effect of eliminating the common law
state of mind element (either negligence or intent to deceive) . . . .” Id.The sound reasoning of TAP has persuaded us to adopt it in this Court, and
we see no basis for creating a divergent line of authority for private lawsuits.
Our holding also comports with this Court’s rationale in Bumbarger v.
Kaminsky, 457 A.2d 552 (Pa. Super. 1983), where we considered the
Vehicle Code’s implications in tort law. Bambarger involved a delivery
driver who, coming down an icy hill, lost control of his truck. Despite
making every effort to break, he ran a stop sign at the bottom. He collided
with another car in the intersection.
The car driver sued the truck driver (and his employer) on the theory
that the trucker had violated the Vehicle Code by running the stop sign. The
jury returned a defense verdict, “due to the condition of the roadways.” Id.- 15 -
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at 553. But the trial judge held the truck driver’s failure “to halt at the stop
sign should not be excused under any circumstances” and granted the
plaintiff a new trial. Id. at 554. “The trial court, in effect, concluded that
[the truck driver] was strictly liable for failing to stop at the sign at the
bottom of the hill.” Id.On appeal, this Court reversed and reinstated the verdict. In doing so,
we explained that a statute imposes one of two types of duty – either (1)
strict liability or (2) negligence per se. This Court turned to Dean Prosser for
delineation between those two categories. Prosser wrote:
It is entirely possible that a statute may impose an
absolute duty, for whose violation there is no recognized
excuse . . . In such a case the defendant may become
liable on the mere basis of his violation of the statute. No
excuse is recognized, and neither reasonable ignorance nor
all proper care will avoid liability. Such a statute falls
properly under the head of strict liability, rather than any
basis of negligence . . . .
Id. (quoting W.E. Prosser, TORTS, § 36 at 197 (4th Ed.1971)).
We concluded that stop signs impose a duty of negligence per se
under the Vehicle Code. Therefore, the Bambarger jury could properly
excuse the Vehicle Code violation due to hazardous road conditions.
A UTPCPL violation, however, is not amenable to excuses. Indeed, we
can think of no instances when a vendor’s deceptive act during a commercial
transaction would be excused under the statute, if, as here, the consumers
justifiably relied upon that conduct to their financial detriment. Unlike the
fluid nature of moving traffic and changing road conditions that might, in
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some cases, excuse a driver’s failure to comply with a stop sign by rendering
compliance physically impossible, the same is not true of a commercial
transaction. The latter occurs in a designed setting entirely of the vendor’s
own creation via preplanned marketing schemes. Thus, vendors place
themselves, by choosing where, when, and how they enter the market, in a
much stronger position to comply fully with the UTPCPL before soliciting or
interacting with consumers. Vendors not only elect whether to enter a
market, but, because “the market” is a fictional place, they have full
volitional control over their conduct when in it.
The UTPCPL is for consumer protection. It undoes the ills of sharp
business dealings by vendors, who, as here, may be counseling consumers
in very private, highly technical concerns. Like the Greggs, those consumers
may be especially reliant upon a vendor’s specialized skill, training, and
experience in matters with which consumers have little or no expertise.
Therefore, the legislature has placed the duty of UTPCPL compliance
squarely and solely on vendors; they are not to engage in deceitful conduct
and have no legally cognizable excuse, if they do.
Thus, we hold that the General Assembly, by “eliminating the common
law state of mind element (either negligence or intent to deceive),” TAP, 36
A.3d at 1253, imposed strict liability on vendors who deceive consumers by
creating a likelihood of confusion or misunderstanding in private, as well as
public, causes of actions. Carelessness or intent, required for negligent or
fraudulent misrepresentations, may be absent when perpetrating “deceptive
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conduct” under 73 P.S. § 201-2(4)(xxi). Given their varying degrees of
requisite intent, a UTPCPL catchall violation and the torts of negligent and
fraudulent misrepresentation raise separate legal issues, as a matter of law.
As such, we conclude that the insurance companies’ assertions of res
judicata and collateral estoppel fail the first step of their respective tests.
Common law misrepresentations and UTPCPL catchall violations present
distinct legal issues. Thus, the trial judge properly made a separate finding
of fact under TAP, and the insurance companies’ first appellate issue lacks
merit.
Damages under the UTPCPL
In their second appellate issue, the insurance companies seek to
mitigate their damages for violating the UTPCPL. They argue that the trial
judge misapplied the doctrine of rescission, because his award did not place
both parties in the positions they occupied prior to Mr. Kovalchik’s unlawful
transaction. Relying upon THE RESTATMENT (THIRD) OF RESTITUTION AND UNJUST
ENRICHMENT § 54, the insurance companies argue that they provided life
insurance coverage to the Greggs of $24,027.55 from 1999 until 2012 and
that, under THE RESTATMENT (THIRD), the trial judge should have offset that
amount from what he awarded to the Greggs. See Companies’ Brief at 34.
The interpretation of a statute – such as the UTPCPL’s damages
provisions – presents a legal question, for which “our scope of review is
plenary, and our standard of review is de novo.” Commonwealth v.
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Andrews, 173 A.3d 1219, 1221 (Pa. Super. 2017). That said, in a non-
jury trial, the judge’s findings of fact “must be given the same weight and
effect on appeal as the verdict of a jury. We consider the evidence in a
light most favorable to the verdict winner. We will reverse the trial court
only if its findings of fact are not supported by competent evidence in the
record or if its findings are premised on an error of law.” Wyatt Inc. v.
Citizens Bank of Pennsylvania, 976 A.2d 557, 564 (Pa. Super. 2009).
The monetary awards for UTPCPL violations are “actual damages or
one hundred dollars ($100), whichever is greater.” 73 P.S. § 201-9.2.
Moreover, the trial “court may, in its discretion, award up to three times
the actual damages sustained, but not less than one hundred dollars
($100), and may provide such additional relief as it deems necessary or
proper. The court may award to the plaintiff, in addition to other relief
provided in this section, costs and reasonable attorney fees.” Id.
The statutory language of the UTPCPL governs this UTPCPL claim.
Thus, the insurance companies’ reliance upon THE RESTATMENT (THIRD) OF
RESTITUTION – i.e., a treatise on common law – is obviously misplaced. The
trial judge properly grounded his award in the statutory remedies that our
General Assembly enacted within the UTPCPL.
As the Greggs rightly stated in their appellate brief, those statutory
remedies “are in addition to common law remedies.” Greggs’ Brief at 53.
In Richards v. Ameriprise Financial, Inc., 152 A.3d 1027 (Pa. Super.
2016), this Court already made clear that:
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[t]he UTPCPL is Pennsylvania's consumer protection law. It
seeks to prevent “[u]nfair methods of competition and
unfair or deceptive acts or practices in the conduct of any
trade or commerce . . . .” 73 P.S. § 201-3. Its aim is to
protect the public from unfair or deceptive business
practices. Our Supreme Court has stated courts should
liberally construe the UTPCPL in order to effect the
legislative goal of consumer protection.
Id. at 1035 (citations omitted).
To ensure those ends, the legislature has empowered trial judges
with broad remedial authority under Section 201-9.2 to undo the harm
that vendors cause when they break the UTPCPL. That includes power to
award treble damages to punish wayward vendors. See 73 P.S. § 201-
9.2. In exercising his broad remedial authority here, the trial judge
concluded that the insurance companies’ “argument regarding a set off
for providing insurance coverage to the [Greggs] from 1999 through
2012 . . . fails.” Trial Court Opinion, 12/5/17, at 5.
The trial judge found that the Greggs paid for coverage and that the
insurance companies “sustained no loss from providing the insurance
because [they] did not have to pay the death benefit.” Id. Thus, the
insurance companies’ assertion that they provided the Greggs with
$24,027.55 worth of coverage goes against the facts as the trial judge found
them and is irrelevant to this Court. Because the trial judge did not believe
the insurance companies’ factual assertion, there is no competent dollar
amount of record to offset against the Greggs’ monetary award.
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J-A17019-18
Thus, Judge Marmo astutely concluded that the “only way” to place the
parties in the same position they occupied prior to the transaction “is for the
[insurance companies] to return all premium payments to the [Greggs].”
Id. We agree. See DeArmitt v. New York Life Insurance Co., 73 A.3d
578, 588-589 (Pa. Super. 2013) (authorizing a full refund of deceitfully
obtained life insurance premiums, when vendor paid out no death benefits).
Hence, we find the trial judge correctly applied DeArmitt, and the insurance
companies’ second issue is likewise meritless.
Judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 9/12/2018
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