Moorman, 435 N.E.2d at 450-51. On the other hand, a sudden and dangerous occurrence arising out of the product's defect is "best served by the policy of tort law." Moorman, 435 N.E.2d at 450.
The supreme court, subsequent to Moorman, elaborated that the "demarcation between physical harm or property damage on the one hand and economic loss on the other usually depends on the nature of the defect and the manner in which the damage occurred." Vaughn v. General Motors Corp., 102 Ill. 2d 431, 466 N.E.2d 195, 197, 80 Ill. Dec. 743 (1984). In Vaughn, the supreme court utilized the phrase "sudden and calamitous" to characterize the type of occurrence that would result in noneconomic damage and thus trigger tort liability. Vaughn, 466 N.E.2d at 197.
While the Illinois Supreme Court has never directly said that a plaintiff who seeks recovery for purely noneconomic damages may do so only in tort, it has never said otherwise. Certainly, it has drawn a line between economic and noneconomic loss and, in doing so, has relied on the distinct policy differences underlying tort and contract/warranty causes of action. For purposes of this court's inquiry here, the dispositive question is whether there is any suggestion or implication in any of the relevant supreme court cases which would cast doubt on the holding of Seegers Grain. This court finds none.
In concluding that the holding in Seegers Grain would in all probability be the holding of the Illinois Supreme Court if it were presented with the issue, this court is careful to note that under federal pleading requirements a plaintiff would be able to plead alternatively, see Fed. R. Civ. P. 8(a), if the facts alleged in the complaint could support the alternative claims. In this case, however, Sundstrand has alleged in each of the counts of its complaint that the operative occurrence was an explosion that resulted in property damage, business interruption and lost profits.
Thus, under the facts as alleged here, Sundstrand can only recover in tort as the alleged occurrence resulting in the damage, an explosion, is sudden and calamitous.
This court is unpersuaded by Sundstrand's other arguments regarding the efficacy of the Seegers Grain decision. For example, Sundstrand contends that the Seegers Grain court unconstitutionally disregarded statutorily created rights under the UCC. A reading of Seegers Grain, however, reveals that the court merely decided that the UCC remedies at issue were unavailable to a plaintiff under certain factual circumstances. Such a decision is well within the confines of an appellate court's power in interpreting state law.
Sundstrand further maintains that the Seegers Grain decision ignores the parties' rights to contract. This argument misses the mark, however. Under Moorman, and its progeny, there can be no breach of contract or warranty recovery for a sudden and calamitous occurrence. Where an occurrence is sudden and calamitous, the harm is to the plaintiff's right to be free from the hazardous risks of a product rather than to the business expectations that the law of warranty or contract is designed to protect. See Moorman, 435 N.E.2d at 450. Hence, absent any harm to the business expectations arising under the contract, there is no recovery in contract. Furthermore, the parties remain free under Seegers Grain to contract in order to preserve their rights concerning economic losses, that is, those losses associated with contract law and contract remedies and arising out of a non-sudden and non-calamitous occurrence.
Lastly, this court does not find Seegers Grain sufficiently distinguishable to render it inapplicable to the present case. There is nothing in Moorman or its progeny to suggest that, where privity exists, a plaintiff may maintain a contract or warranty action to recover noneconomic losses arising out of a sudden and calamitous event. Rather, the operative distinction in this context is whether the loss is economic or noneconomic. See Szajna v. General Motors Corp., 115 Ill. 2d 294, 503 N.E.2d 760, 767, 104 Ill. Dec. 898 (1986).
For the foregoing reasons, Lake Shore's motion to dismiss Counts III, IV and V of Sundstrand's complaint is granted.
PHILIP G. REINHARD, JUDGE
UNITED STATES DISTRICT COURT
DATED: January 11, 1994