Appellate Court Allows Subrogation Suit Against City of Ithaca to Proceed

A water meter ruptured in the basement of State Farm’s insured, a dental office. The ruptured meter caused water damage to property, for which State Farm paid. State Farm brought a subrogation action against the City of Ithaca alleging that this loss was caused by the City’s negligent operation of its water system. Defendant Ithaca moved for summary judgment, asking the Court to dismiss the complaint because there was no duty for the City to inspect the water meter. State Farm responded by arguing that its theory wasn’t that Ithaca was supposed to inspect this water meter; rather, State Farm’s theory of liability is that there was actual negligence on the part of the City which caused the meter to rupture.

In opposing the motion, the City offered the affidavit of an engineer, who gave his opinion that the rupture was due to sudden pressure, described as a “water hammer,” which originated from inside the dental office.   State Farm countered with an affidavit from their expert, who stated the rupture was caused by a water hammer that originated outside the dental office when a valve within the City’s water system was opened too quickly.  This expert also stated that a “backflow preventer” located inside the dental office and downstream of the water meter which would have prevented pressuring from originating inside the dental office to have caused the meter to burst.  State Farm also offered affidavits from its insureds, who indicated there had been interruption of their water service due to work being performed by the City on the streets nearby. 

Defendant City moved to dismiss the complaint and State Farm cross-moved for a finding that the City was liable.  The trial judge granted the Defendant City’s motion and dismissed the lawsuit. [1]   State Farm appealed.  The appellate court modified the trial judge’s order and revived State Farm’s lawsuit.   The Court found there were questions of fact which could only be resolved by a factfinder (normally, a jury).  Both parties had submitted affidavits from experts and the two expert affidavits contradicted each other as to how the loss occurred and who was responsible for causing it.  The City argued that State Farm failed to show that the backflow preventer was actually functioning at the time of the loss, but the appellate court found this “goes to the weight of plaintiff’s expert evidence and does not render it insufficient to raise an issue of fact.”

Bottom Line:   After discovery has concluded, defendants often file motions for summary judgment, asking the court to dismiss the suit without the matter proceeding to a jury trial.  In determining whether or not to grant such motions, courts look to whether there are any “factual disputes.”  Submissions of affidavits from your experts and your insureds are critical to showing the court that there are disagreements between the Plaintiff and Defendant over the cause of the loss.   Failure to submit such affidavits may result in a meritorious case being dismissed.  Reminder: When you have a claim against a municipality, you must serve a notice of claim within 90 days of the loss.

[1] State Farm a/s/o Fall Creek Family Dentistry v. City of Ithaca, Third Department Index 517969 (October 16, 2014).