Autry Morlan Chevrolet, Cadillac, Inc. v. RJF Agencies, Inc.
2010 Mo. App. LEXIS 1673
| Mo. Ct. App. | 2010Background
- Morlan operated a Chevrolet and Cadillac dealership in Dexter, Missouri.
- Bancorp provided floor-plan financing to Morlan and held a security interest in Morlan's inventory.
- Bancorp arranged an insurance program for dealers through RJF, issuing a master policy with Lloyd's of London for insureds financed by Bancorp.
- The program included an aggregate weather deductible option with a minimum deductible of $35,000, intended to cap weather-related losses.
- Morlan signed the RJF Dealer Open Lot Insurance proposal and received an insurance certificate; Bancorp later decided not to renew the aggregate weather deductible in February 2006, extending it temporarily to March 1, 2006.
- After hail storms in March and April 2006 damaged Morlan’s vehicles, Morlan claimed damages for lacking the aggregate weather deductible, seeking recovery for additional losses and related attorney’s fees and punitive damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Morlan's negligence claim is barred by the economic loss doctrine | Morlan argues a special fiduciary relationship creates a tort duty. | Respondents contend the doctrine bars purely economic losses and there is no special relationship. | No; the doctrine did not bar Morlan given alleged special relationship. |
| Whether RJF, Bancorp, and Reahr owed a duty and whether Morlan can prove damages | Morlan alleges a fiduciary duty arising from the relationship and seeks damages tied to insurance coverage shortfalls. | RJF, Bancorp, and Reahr argue no duty and insufficient damages proof; may prevail on other grounds. | The trial court erred; issues of duty and damages remain for trial; remand warranted. |
| Whether the trial court properly granted summary judgment on the economic loss doctrine and duty/damages issues | Morlan contends summary judgment was inappropriate given potential duties and damages evidence. | Respondents maintained proper application of the doctrine and lack of duty/damages. | Trial court reversal; responses create genuine issues of material fact; remand for proceedings consistent with the opinion. |
Key Cases Cited
- Crowder v. Vandendeale, 564 S.W.2d 879 (Mo. banc 1978) (economic loss doctrine origins; damages limited to personal injury or separate property damage)
- Groppel Co. v. U.S. Gypsum Co., 616 S.W.2d 49 (Mo.App. E.D. 1981) (defined economic loss doctrine scope)
- Sharp v. American Hoist & Damper Co., 703 S.W.2d 901 (Mo. banc 1986) (no tort recovery for product-only damages under strict liability)
- American Mortgage Investment Co. v. Hardin-Stockton Corp., 671 S.W.2d 283 (Mo.App. W.D. 1984) (fiduciary duty arising from contract may support tort liability)
- Busey Truck Equip., Inc. v. American Family Mut. Ins. Co., 299 S.W.3d 735 (Mo.App. E.D. 2009) (broker/agent owes duty of reasonable skill, care, diligence to obtain requested insurance)