the defendant's duty of care. Based on the facts in this case and the commercial context in which the loss occurred, it was not foreseeable that Lenox's agent would store an inventory of jewelry samples with a wholesale value of approximately $ 125,000 in the trunk of his car. In contrast to the risk of property damage by fire in Scott & Fetzer, and the risk of theft in American Centennial, the loss of valuable jewelry was not "highly foreseeable" under the circumstances because it was never disclosed to Triangle that its alarm was to protect valuable commercial property. Thus, in the language of the Restatement (Second) of Torts § 281 (1965), the risk of theft of a set of jewelry samples was not one of the "hazards" against which defendant could reasonably be expected to protect.
The Court, of course, accepts that in "the majority of cases, where varying inferences are possible from the facts, a court should permit the jury to decide the foreseeability issue . . . as a factual matter in its proximate cause determination." The Court further accepts the principle that foreseeability, as it relates to duty, "is a determinative consideration only where a particular occurrence is so extreme that, as a policy decision, it would be unwise to require defendant to guard against it." Nelson, 465 N.E.2d at 519.
Turning to the three core policy considerations enumerated above -- the likelihood of injury, the magnitude of the burden of guarding against it and the consequences of placing the duty upon the defendant -- the Court follows the reasoning of Scott & Fetzer, 112 Ill. 2d 378, 493 N.E.2d 1022, 1026, 98 Ill. Dec. 1, in which the Illinois Supreme Court held that the magnitude of the burden of guarding against the injury was not to be confused with the defendant's potential exposure to liability from breach of his duty. Id. at 1026. Thus, the magnitude of the burden of guarding against failure of the alarm system amounts to no more than the exercise of due care in the installation of the alarm. Therefore, the second factor does not militate against the finding of a duty of care.
However, examination of the remaining two factors supports this Court's conclusion that Triangle did not have a duty to prevent the theft of plaintiff's jewelry samples. First, and related to the issue of foreseeability, the risk that a salesman would regularly store valuable jewelry samples in the car appears remote. It is likely that the proportion of auto alarms purchased with the undisclosed intent of protecting valuable commercial interests is not sufficiently large, when considered with other factors, to justify the imposition of a duty upon the seller to protect such interests as a matter of law.
Second, requiring defendant to protect against the theft of valuable commercial property would not only have the consequence of exposing it to substantial (indeed, virtually unlimited) liability, but also would discourage commercial users of auto alarms from disclosing that they intend to use the alarm to protect commercial property of substantial value. After all, why should a customer inform the alarm company of the magnitude of the risk it is being hired to protect against, when damages in tort can be had regardless of disclosure?
Taking into account these sorts of policy concerns is vital in determining whether a duty of care arises, as demonstrated by the Seventh Circuit's decision in Rardin v. T & D Machine Handling, Inc., 890 F.2d 24 (7th Cir. 1989). In Rardin, the court of appeals held that the purchaser of a printing press could not recover in tort from a company hired by the seller to dismantle and load the press, because the press handler, though negligent, was under no duty of care to the plaintiff. Id. at 25, 30. Plaintiff had sought lost profits arising from the delay in putting the press into use. Id. at 26. Although the court of appeals assumed that causation was no issue, it concluded that the unforeseeability of the potential magnitude of damages made imposition of a duty unwise. "In deciding how much effort to expend on being careful -- and therefore how far to reduce the probability of a careless accident -- the potential injurer must have at least a rough idea of the extent of liability." Id. The court further reasoned that in the context of commercial activities, it is sound policy to encourage parties to bargain about who should bear the risk of loss. Id. at 28-29. To permit a "tort end-run" around the contract-law limitation on consequential damages would discourage open and straightforward negotiations to determine the allocation of risk and the payment that would be appropriate in light of that allocation. Id. As the court of appeals noted, "it is in contractual settings that the potential victim ordinarily is best able to work out alternative protective arrangements and need not rely on tort law." Id. at 29.
Similarly, in this case, had Triangle been informed that the alarm was intended to safeguard valuable commercial property, it likely would have negotiated a higher price for its services, or insisted on a more detailed contractual limitation on its potential liability. Forbidding tort recovery here would treat both parties even-handedly, for if Triangle is to insure Lenox's commercial property, it is entitled to have Lenox "compensate it accordingly." Id. at 30. Indeed, were Lenox's theory of liability permissible, there is no reason that Triangle's liability should be limited to $ 125,000; Lenox could have had its agent carry samples worth $ 1,250,000, or even $ 1,250,000,000, for that matter, with any loss (in theory) to be picked up by Triangle should one of Triangle's agents prove to have been careless. It is the teaching of Rardin that contract law governs recovery here.
Therefore, the Court holds that Triangle did not have a duty to protect Lenox against the theft of jewelry samples because Lenox's agent, DePasse, did not disclose the type and potential value of the property which he intended the alarm to protect. Summary judgment is granted on Count III of the complaint.
For the reasons set forth above, the Court grants summary judgment in favor of Triangle and against Lenox on Counts I, II and III of the complaint.