Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

ALLENDALE MUT. INS. v. LEASEWAY WAREHOUSE

August 5, 1985

ALLENDALE MUTUAL INSURANCE COMPANY, AS SUBROGEE OF INTERSTATE INDUSTRIES, INC., AND SEARS ROEBUCK & COMPANY, PLAINTIFFS,
v.
LEASEWAY WAREHOUSE, INC., AND AMERICAN DISTRICT TELEGRAPH COMPANY, DEFENDANTS.



The opinion of the court was delivered by: Nordberg, District Judge.

MEMORANDUM OPINION AND ORDER

Defendant American District Telegraph Company ("ADT"), has brought a motion for summary judgment against the plaintiff, Allendale Mutual Insurance Company ("Allendale"), and for summary judgment against its co-defendant Leaseway Warehouse, Inc. ("Leaseway"). Leaseway has also moved for summary judgment against the plaintiff, Allendale. For the foregoing reasons, Leaseway's motion is denied, and both motions of ADT are granted.

Facts

ADT and Leaseway entered into a contract whereby ADT agreed to provide Leaseway with supervisory sprinkler and water flow alarm service which would detect any water leakage from the sprinkler system within Leaseway's warehouse. The contract contained the following clauses:

  "The subscriber (Leaseway) does not desire this
  contract to provide for full liability of the
  contractor (ADT) and agrees that the contractor shall
  be exempt from liability for loss, damage or injury
  due directly or indirectly to occurrences or
  consequences therefrom which the service or system is
  designed to detect or avert; . . ."
  In the event any person, not a party to this
  agreement, shall make any claim or file any lawsuit
  against the contractor for failure of its equipment
  or service in any respect, subscriber agrees to
  indemnify, defend and hold contractor harmless from
  any and all such claims and lawsuits including the
  payment of all damages, expenses, costs and
  attorney's fees.

The plaintiff, Allendale, was not a party to this contract, nor were its subrogors.

A contract did exist between the subrogor and Leaseway whereby Leaseway agreed to store Interstate Industries, Inc. ("Interstate") stereo consoles at its warehouse. According to Leaseway, its liability for any losses for damages was limited by the warehouse receipts which contained the terms and conditions of the bailment. The receipts stated the time period in which a claim must be made (60 days) and the time period for the commencement of an action (nine months) against Leaseway.

On the night of January 27, 1979 a large chunk of ice fell from the roof and wall of the Leaseway warehouse where the stereo consoles were stored. The ice broke a water pipe connected to the sprinkler system. The alarm sounded and was received by ADT. ADT notified the Alsip Fire Department and sent out an alarm investigator. Both found nothing. ADT also alerted a Leaseway employee, who told ADT he would check out the situation. However, the employee never arrived at the warehouse because his auto got stuck in the snow. He contacted ADT and told them that he would be unable to respond to the alarm. ADT did not call or notify any other Leaseway employee. Water continued to flow from the broken pipe, damaging the property of Interstate.

The plaintiff is now seeking a recovery of the amount it paid to the insured. Leaseway, however, contends that no claim was filed within 60 days nor was this action commenced within nine months of the accident. Consequently, the plaintiff cannot recover. Yet, the plaintiff contends that its insured never received receipts. Further, even if the subrogor did receive such receipts, Leaseway had sufficient notice of the claim for damages because of communications which were made between the parties pertaining to the damaged property.

In addition to claims against Leaseway, the plaintiff contends that ADT is liable to it in tort. According to the plaintiff liability is imposed under § 324A of the Restatement which creates liability when a person negligently performs an undertaking. The Restatement states:

  "One who undertakes, gratuitously or for
  consideration, to render services to another which he
  should recognize as necessary for the protection of a
  third person or his things, is subject to liability
  to the third person for physical harm resulting from
  his failure to exercise reasonable care to protect
  his undertaking, if
  (a) his failure to exercise reasonable care increases
  the risk of such harm, or
  (b) he has undertaken to perform a duty owed by the
  other to the ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.