Tag Archives: Limitation of Liability

Engeman Enterprises, LLC v. Tolin Mechanical Systems Co., 2013COA34 (March 14, 2013)

“Listen, this old system of yours could be on fire and I couldn’t even turn on the kitchen tap without filling out a 27b/6.” Harry Tuttle – Brazil. In this case, Defendant’s employee, while repairing a cooling system, caused a tank of ammonia to explode, causing property damage. Plaintiff sued in tort, not breach of contract. The court of appeals affirmed dismissal under the economic loss rule (ELR). No tort duties existed outside of the repair contract because Plaintiff could have sought consequential damages, equal to tort damages, even with a limitation-of-liability clause. Though ammonia is toxic, the standard of “reasonable care” in tort law is the same as “prudent and workmanlike” because Colorado does not recognize a distinct “highest” degree of care. The court also held that ELR applies to property damage and negligent supervision is not a distinct tort claim.

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Core-Mark v. Sonitrol Corp. 2012COA120 (July 19, 2012)

A massive fire started by a burglar burns down a warehouse. The burglar alarm system failed. The owner and its insurers sue the security company. The trial court dismissed all claims and plaintiff appealed to the court of appeals; the contract claims survive but the court finds that a limitation of liability provision did not limit a willful and wanton breach of contract. The security company loses at trial and brought this second appeal, challenging the prior appellate decision, the exclusion of its experts, and the refusal to designate the burglar as a nonparty at fault. Here, the court addressed and confirmed its prior decision notwithstanding the “law of the case,” but reversed for a new damages trial. The exclusion of the experts was not harmless because their testimony was central to damages. But, the nonparty at fault statute only applies to torts, not contract claims.



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Filed under Contracts