Chow v. Merrimack Mutual Fire Insurance
987 N.E.2d 1275
Mass. App. Ct.2013Background
- Plaintiff owned a restaurant and a separate property insured under defendant's homeowners policy; the property housed living quarters for restaurant staff.
- Damage occurred when pipes froze and burst in late 2006/early 2007; thermostats were reportedly kept at sixty degrees by the caretaker.
- Policy excludes damage from freezing when the dwelling is unoccupied unless reasonable care to maintain heat is used or water is shut off and drained.
- Caretaker Lau managed the property earlier but stopped working in late 2006; plaintiff maintained only limited control over Lau's activities at the property.
- Building damage was discovered January 2007; baseboard heaters were off at that time; inspector condemned the property.
- Jury found in defendant’s favor at trial; plaintiff appealed challenging the jury instruction imputing caretaker negligence to plaintiff.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can caretaker's negligence be imputed to the owner for purposes of the heat-maintenance duty? | Chow argues Lau’s actions should not be imputed to Chow as master/servant or agent; relationship was not clearly master-servant. | Lau acted to maintain the property on Chow’s behalf; negligence by Lau could be imputed to Chow to satisfy the duty to maintain heat. | Imputation not proper; error in instruction; remanded for further proceedings. |
| Whether the trial court correctly instructed the meaning of 'unoccupied' in the exclusion. | Unoccupied is a legal question and should be decided by the court, or the term is ambiguous and construed against insurer. | Unoccupied was properly defined for the jury; guidance given on whether premises were used as a dwelling. | Instruction was essentially correct; term not ambiguous; no reversal on this point. |
Key Cases Cited
- Palmer v. Pawtucket Mut. Ins. Co., 352 Mass. 304 (1967) (due diligence with respect to maintaining heat; anti-freeze usage recognized as due diligence.)
- International Ins. Co. v. R.I. Reid, 400 S.W.2d 939 (Tex. Civ. App. 1966) (no imputation to owner for foreman’s heat-maintenance actions.)
- JMB Enterprises v. Atlantic Employers Ins. Co., 228 N.J. Super. 610 (1988) (independent contractor's negligence generally not imputed to principal.)
- Hohenleitner v. Quorum Health Resources, Inc., 435 Mass. 424 (2001) (control over agent determines principal's liability; master-servant vs independent contractor.)
- Corsetti v. Stone Co., 396 Mass. 1 (1985) (liability depends on nature of master-servant relationship and control.)
- Herbert A. Sullivan, Inc. v. Utica Mut. Ins. Co., 439 Mass. 387 (2003) (negligence standard applies to questions of agency and reasonable care.)
- McCabe v. Allstate Ins. Co., 260 A.D.2d 850 (N.Y. App. Div. 1999) (interpretation of insurance terms; prudent caution in contract interpretation.)