Insurance Defense Archives

Changes to the Gist of the Action Doctrine in Pennsylvania

Recently, the Pennsylvania Supreme Court, has issued a ruling which may grant tort claims for fraudulent contract performance. Bruno v. Erie Ins. Co., 106 A.3d 48 (Pa. 2014). Pennsylvania courts have employed two methods to determine whether tort claims that accompany contract claims should be allowed as freestanding causes of action or rejected as impermissible attempts to recast a contract claim into a tort: the gist of the action doctrine and the economic loss doctrine. In theory, these are distinct doctrines under Pennsylvania law. From a practical perspective, the doctrines operate identically and share a common purpose: maintaining the separate spheres of contract and tort.[1] Historically, the economic loss doctrine evolved in the context of products liability cases, precluding tort recovery where the only injury is to the product itself, while the gist of the action has been applied more frequently in non-products liability cases.[2]