DINARDO v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

Filing 16

MEMORANDUM AND ORDER THAT THE MOTION OF DEFENDANT STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY IS DENIED; ETC.. SIGNED BY HONORABLE HARVEY BARTLE, III ON 10/17/13. 10/17/13 ENTERED AND E-MAILED.(jl, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANI
MICHAEL DiNARDO

v.
STATE FARM MUTUAL AUTOMOBILE
INSURANCE CO.

FU.~ED
NO. 12-7007

013

MEMORANDUM
Octob

Bartle, J.

1

2013

Plaintiff Michael DiNardo ("DiNardo") has sued his
insurer, the defendant State Farm Mutual Automobile Insurance
Company ("State Farm").

He seeks uninsured motorist benefits as

a result of injuries he suffered on November 23, 2008 when he was
struck by a motor vehicle while riding a bicycle.

Before the

court is the motion of State Farm for partial summary judgment
under Rule 56 of the Federal Rules of Civil Procedure.

For the

reasons discussed below, State Farm maintains that DiNardo is
estopped from recovering any damages other than for loss of
future earnings. There is no genuine dispute as to any material
fact.

See Fed. R. Civ. P. 56(a).
On November 19, 2009, almost a year after his accident,

DiNardo filed a Chapter 7 bankruptcy petition in the Eastern
District of Pennsylvania.

In re Michael DiNardo, #09-BK-18821.

In his petition, he identified his uninsured motorist claim
against State Farm as an asset on Schedule B and on Schedule C
listed it as property claimed to be exempt from the bankrupt

estate under 11 U.S.C.

§

522 (d) (5)

1

and (d) (11) (D) . 2

In each

instance, he stated the value of the property as $20,200.
However, on January 5, 2010, DiNardo amended Schedule B and
reduced the current value of the property to $0.00.

On amended

Schedule c, he described the property as "DiNardo v. State Farm
Insurance" and in the column under "Law Providing Each Exemption"
he wrote "11 U.S.C.

§

522(d) (11) (E)."

That provision exempts

from the bankrupt estate "a payment in compensation of loss of
future earnings of the debtor ... "
The Bankruptcy Court granted him a bankruptcy discharge
on April 8, 2010 and the matter was closed on April 19, 2010.
This lawsuit followed.

State Farm removed it to this court from

1. Title 11 U.S.C. § 522(d) (5), at the relevant time period,
read in part (see 11 U.S.C. § 104):
(d)
The following property may be exempted
under subsection (b) (1) of this section:
(5)
The debtor's aggregate interest in
any property, not to exceed in value
$1,075 plus up to $10,125 of any unused
amount of the exemption provided under
paragraph (1) of this subsection.
2. Title 11 U.S.C. § 522(d) (11) (D), at the relevant time period,
provided (see 11 U.S.C. § 104):
(11)
The debtor's right to receive, or
property that is traceable to (D)
a payment, not to exceed
$20,200, on account of personal
bodily injury, not including pain
and suffering or compensation for
actual pecuniary loss, of the
debtor or an individual of whom the
debtor is a dependent;
-2-

the Court of Common Pleas of Philadelphia County on December 13,
2012.
State Farm argues that as a result of his statements in
amended Schedule C to his bankruptcy petition, DiNardo is
estopped from claiming here anything other than loss of future
earnings.

State Farm relies primarily on Oneida Motor Freight,

Inc. v. United Jersey Bank, 848 F.2d 414

(3d Cir. 1988).

There,

Oneida had filed a petition under Chapter 11 of the Bankruptcy
Code.

One of the creditors was United Jersey Bank.

Thereafter,

in August 1986, the court confirmed Oneida's Joint Plan of
Reorganization.

The following year, Oneida sued the Bank for

breach of credit agreement which had been the subject of the
bankruptcy proceeding.

The District Court dismissed the

complaint for failure of Oneida to have identified in the
bankruptcy proceeding the claim or property at issue in the
lawsuit.
The Court of Appeals, affirming the District Court,
explained that bankruptcy law requires a debtor to list for the
benefit of creditors all the debtor's interests and property
rights.

In identifying assets and liabilities, a debtor must

disclose "adequate information" about them.
§

1125.

See 11

u.s.c.

The Court of Appeals held that Oneida's claim against

the Bank was barred by the doctrine of judicial estoppel. 3

Under

3. The Court of Appeals also invoked the doctrine of equitable
estoppel on the ground that Oneida had failed to identify a claim
in the bankruptcy proceeding against the Bank, which was a
(continued ... )
-3-

that doctrine, a party is precluded "from assuming a position in
a legal proceeding inconsistent with one previously asserted."
Oneida, 848 F.2d at 419.

Since the then existing property claim

had not been identified in the bankruptcy petition, it could not
be the subject of a later lawsuit after the conclusion of the
bankruptcy proceeding.

See also, In re The Drexel Burnham

Lambert Group, Inc., 160 B.R. 508, 513-14 (S.D.N.Y. 1993).
DiNardo counters that unlike the debtor in Oneida, he
disclosed his property claim against State Farm in the amended
Schedules B and C.

He also references the February 4, 2010

letter from Lynn E. Feldman, Esquire, the bankruptcy trustee, to
DiNardo's personal injury lawyer, Paul Benn, Esquire.

The letter

reads:
This letter will confirm our telephone
conversation of January 21, 2010, concerning
the personal injury claim of your client,
Michael DiNardo.
You advised that this is a first party claim
against Mr. DiNardo's own insurance company.
The injury was an aggravation of a preexisting back injury.
This was a soft tissue
injury.
Based upon our conversation and the
information you provided regarding the nature
and scope of injuries, I will be abandoning
the case and closing my file.
Please call if you have any questions.

3.
( ... continued)
creditor.
State Farm was not a creditor in DiNardo's bankruptcy
proceeding.
-4-

We agree that DiNardo disclosed his property claim
against State Farm in the bankruptcy proceeding.

While it is

true that in amended Schedule C the claimed property exemption
was described as his loss of future earnings in "DiNardo v. State
Farm Insurance," amended Schedule B listed without limitation
"DiNardo v. State Farm Insurance" under the column "other
personal property of any kind not already listed."

In contrast

to the exemption claimed in amended Schedule C, amended Schedule
B did not confine the description of his property claim to loss
of future earnings.

The description of an asset and the

description of what a debtor asserts to be an exempt part of an
asset on separate schedules of a bankruptcy petition are two
different matters.

State Farm focuses on amended Schedule C and

ignores amended Schedule B.
Moreover, the bankruptcy trustee was well aware of the
nature of DiNardo's personal injury claim against State Farm
before she abandoned it.

From the letter she wrote, there is no

indication that only loss of his future earnings was involved.
Once abandoned by the trustee, the claim was no longer a part of
the bankruptcy estate and re-vested in DiNardo.

11 U.S.C.

§§ 554 (a)- (c).

It is not decisive that DiNardo placed no specific
dollar value on his claim against State Farm.

At that early

stage, any valuation would have been pure speculation.
Accordingly, because DiNardo expansively identified his
property as "DiNardo v. State Farm Insurance" on amended Schedule
-5-

B, judicial estoppel does not bar any part of his claim in his
present lawsuit.

The motion of State Farm for partial summary

judgment will be denied.

ENlERED
QC11 1 10\'l
CLERK Of coUf\1

-6-