Category Archives: Subrogation

Water Loss

Commercial Tenant’s Subrogating Insurer Barred by Lease Terms from Pursuing Landlord


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In Travelers Indem. Co. of Am. v. Schwarz Props., L.L.C., 2020 U.S. Dist. LEXIS 18176, the United States District Court for the Western District of North Carolina considered whether the lease between a commercial tenant and its landlord barred the tenant’s insurance carrier from subrogating against the landlord for damages to the tenant’s goods. The court found that the tenant’s carrier could not subrogate against the landlord because the lease clearly and explicitly stated that the landlord was not responsible for the tenant’s property. In addition, the lease required the tenant to insure its own property and to hold the landlord harmless for any damage to the tenant’s goods. This case establishes that, in North Carolina, negligence claims between a landlord and tenant may be barred if the lease includes clear and explicit exculpatory and indemnification provisions. Continue reading →

This entry was posted in Landlord-Tenant, North Carolina, Subrogation, Sutton Doctrine and tagged , , , , .
Large Property Loss

Massachusetts Court Holds Statute of Repose Does Not Apply to Claims for Failure to Maintain Property


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In Penn-America Insurance Company v. Bay State Gas Company, 96 Mass. App. Ct. 757 (2019), the Appeals Court of Massachusetts considered whether the plaintiff’s claims against the defendant, arising from an alleged defect in the defendant’s natural gas line, were time-barred by the six-year statute of repose for improvements to real property. The Appeals Court held that the statute of repose did not apply to the plaintiff’s claims, which were related to the defendant’s alleged failure to maintain its property. Thus, in Massachusetts, the statute of repose does not apply if the plaintiff’s claim is rooted in the failure to maintain an improvement, rather than negligent design or construction of the improvement. Continue reading →

This entry was posted in Construction Defects, Massachusetts, Statute of Limitations-Repose, Subrogation and tagged , , , .

Pennsylvania Superior Court Fires up a Case-By-Case Analysis for Landlord-Tenant, Implied Co-Insured Questions


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In Joella v. Cole, 2019 PA Super. 313, the Superior Court of Pennsylvania recently considered whether a tenant, alleged by the landlord’s property insurance carrier to have carelessly caused a fire, was an implied co-insured on the landlord’s policy. The court found that the tenant was an implied co-insured because the lease stated that the landlord would procure insurance for the building, which created a reasonable expectation that the tenant would be a co-insured under the policy. Since the tenant was an implied co-insured on the policy, the insurance carrier could not maintain a subrogation action against the tenant. This case confirms that Pennsylvania follows a case-by-case approach when determining whether a tenant was an implied co-insured on a landlord’s insurance policy. Continue reading →

This entry was posted in Anti-Subrogation Rule, Landlord-Tenant, Pennsylvania, Subrogation, Sutton Doctrine and tagged , , .
Pointing out a Problem

Amazon Feels the Heat From Hoverboard Fire Claims


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In State Farm Fire & Cas. Co. v. Amazon.com, Inc., No. 3:18CV166-M-P, 2019 U.S. Dist. LEXIS 189053 (Oct. 31, 2019), the United States District Court for the Northern District of Mississippi considered a Motion for Judgment on the Pleadings filed by defendant Amazon.com, Inc. (Amazon). Amazon argued that, because it was a “service provider” who cannot be held liable under Mississippi’s Product Liability Act (MPLA), Miss. Code § 11.1.63, the negligence and negligent failure to warn claims filed against it by plaintiff State Farm Fire & Casualty Company (State Farm) failed as a matter of law. The court, looking beyond the MPLA, held that State Farm’s complaint stated a claim against Amazon. Continue reading →

This entry was posted in Mississippi, Products Liability, Subrogation and tagged , .
Fire

Careless Smoking Causation Defense Goes Up in Smoke in Connecticut


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In Conn. Interlocal Risk Mgmt. Agency v. Jackson, 2019 Conn. LEXIS 230 (Sept. 1, 2019) (Conn. Interlocal), the Supreme Court of Connecticut considered a careless smoking case and whether, as a matter of first impression, Connecticut should adopt the alternative liability doctrine first set forth in Summers v. Tice, 199 P.2d 1 (Cal. 1948). Recognizing that the doctrine is a sound one, the court adopted it for cases proceeding in Connecticut. Continue reading →

This entry was posted in Connecticut, Negligence, Subrogation and tagged , , , .
Gavel

Amazon Loses – It Is a Seller Under Wisconsin’s Products Liability Law


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As most subrogation professionals know, Amazon has been fighting products liability claims across the country for some time now. While it has been largely successful in doing so in the past, in a recent decision, Wisconsin sided with the plaintiff. In the case of State Farm Fire & Cas. Co. v. Amazon.com, Inc., 2019 U.S. Dist. LEXIS 122316, 2019 WL 3304887, the United States District Court for the Western District of Wisconsin denied the motion for summary judgment filed by defendant Amazon.com, Inc. (Amazon). The court held that Amazon was so deeply involved with the transaction at issue that it was an entity that could be held strictly liable under Wisconsin law. It also held that 47 U.S.C. § 230 of the Communications Decency Act (CDA) did not immunize Amazon because its liability was not based on posting content from a third party. Continue reading →

This entry was posted in Products Liability, Subrogation, Wisconsin and tagged , , .
Figures

Ohio Court Measures the Damage to a Computer Network by Its Value to the Owner, Not Its Fair Market Value


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In Westfield Insurance Group v. Silco Fire & Security, 2019 Ohio App. LEXIS 2810, the Court of Appeals of Ohio, Fifth Appellate District addressed whether the trial court properly instructed the jury that the applicable measure of damages for damage done to a computer network was the network’s replacement cost value rather than its fair market value. Based on the unique circumstances of the case, the Court of Appeals held that the trial court did not abuse its discretion when it instructed the jury on the replacement cost measure of damages rather than fair market value. Continue reading →

This entry was posted in Contracts, Damages - Real Property, Ohio, Subrogation and tagged , , .
Broken Bricks

Wisconsin Supreme Court Holds that Subrogation Waiver Does Not Violate Statute Prohibiting Limitation on Tort Liability in Construction Contracts


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In Rural Mut. Ins. Co. v. Lester Bldgs., LLC 2019 WI 70, 2019 Wisc. LEXIS 272, the Supreme Court of Wisconsin considered whether a subrogation waiver clause in a construction contract between the defendant and the plaintiff’s insured violated Wisconsin statute § 895.447, which prohibits limitations of tort liability in construction contracts. The Supreme Court affirmed the lower court’s decision that the waiver clause did not violate the statute because it merely shifted the responsibility for the payment of damages to the defendant’s insurance company. The waiver clause did not limit or eliminate the defendant’s tort liability. This case establishes that while
§ 895.447 prohibits construction contracts from limiting tort liability, a subrogation waiver clause that merely shifts responsibility for the payment of damages from a tortfeasor to an insurer does not violate the statute and, thus, is enforceable. Continue reading →

This entry was posted in Construction Defects, Subrogation, Waiver of Subrogation, Wisconsin and tagged , , , , .
Large Property Loss

Texas Walks the Line on When the Duty to Preserve Evidence at a Fire Scene Arises


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The extent to which a loss scene can be altered before adversaries can legitimately cry spoliation has long been a mysterious battleground in the world of subrogation. In the case of In re Xterra Constr., LLC, No. 10-16-00420-CV, 2019 Tex. App. LEXIS 3927 (Tex. App. – Waco, May 15, 2019), the Court of Appeals of Texas, Tenth District, addressed the question of when a party has a duty to preserve evidence. The court found that the trial court abused its discretion in imposing sanctions on the defendants for the spoliation of evidence as the evidence at issue was already gone by the time the defendants knew or reasonably should have known there was a substantial chance a claim would be filed against them. Continue reading →

This entry was posted in Evidence, Spoliation, Subrogation, Texas and tagged , , .
Gavel

New York Court Holds That the “Lesser of Two” Doctrine Limits Recoverable Damages in Subrogation Actions


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In New York Cent. Mut. Ins. Co. v. TopBuild Home Servs., Inc., 2019 U.S. Dist. LEXIS 69634 (April 24, 2019), the United States District Court for the Eastern District of New York recently held that the “lesser of two” doctrine applies to subrogation actions, thereby limiting property damages to the lesser of repair costs or the property’s diminution in value. Continue reading →

This entry was posted in Damages, Damages - Real Property, New York, Subrogation and tagged , , .