Gage v. HSM ELECTRONIC PROTECTION SERVICES, INC.
2011 U.S. App. LEXIS 18918
| 8th Cir. | 2011Background
- Gage contracted with HSM in 2006 for installation and monitoring of a security system; agreement contained an exculpatory clause, an anti-subrogation clause, and a liability cap.
- HSM was later acquired by Stanley; Stanley thereafter handled Gage’s service.
- In 2008, a low-temperature alarm was received; Stanley’s operator acknowledged and attempted contact but did not inform Gage or the listed contacts; no clear recording supports the contact.
- The residence remained in peril; the temperature drop caused a pipe to burst two months later, damaging the home; insurer paid Gage, who then sued Stanley for willful and wanton negligence, intentional misconduct, fraud, and misrepresentation, including subrogation by insurer.
- District court granted summary judgment for Stanley, holding the exculpatory clause barred the claim; Gage appealed, arguing Minnesota law does not permit contractually waiving willful and wanton negligence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether exculpatory clause bars willful and wanton negligence under Minnesota law | Gage | Stanley | Exculpatory clause cannot bar willful and wanton negligence claims |
| Whether Minnesota law distinguishes willful and wanton negligence from gross negligence for contract-voiding purposes | Gage | Stanley | Minnesota recognizes a separate willful and wanton standard; not synonymous with gross negligence |
| Whether New York gross-negligence cases are applicable to interpret the Minnesota-exculpatory clause | Gage | Stanley | New York cases are not controlling and are distinguishable |
| Whether genuine issues of material fact exist regarding the operator’s willful and wanton conduct in responding to the alarm | Gage | Stanley | There are genuine issues of material fact requiring remand for trial |
Key Cases Cited
- Ackerman v. American Family Mutual Ins. Co., 435 N.W.2d 835 (Minn. Ct. App. 1989) (distinguishes between gross negligence and willful and wanton negligence)
- Bolsinger v. State, 21 N.W.2d 480 (Minn. 1946) (criminal negligence context; caution in applying to torts; reflects recklessness concept)
- Fonda v. St. Paul City Ry. Co., 74 N.W. 166 (Minn. 1898) (early discovery-peril doctrine framing willful and wanton standard)
- Jacoboski v. Prax, 187 N.W.2d 125 (Minn. 1971) (willful and wanton negligence does not require malice or gross negligence)
- Beeyher? v. Cragun Corp., 636 N.W.2d 821 (Minn. 2002) (court of appeals description distinguishing willful/wanton from gross negligence)
- Mueller v. Dewey, 198 N.W. 428 (Minn. 1924) (historical discussion of willful and wanton doctrine)
- Gage v. Stanley Convergent Security Solutions, Inc., 655 F.3d 821 (8th Cir. 2011) ( Minn. exculpatory clause; willful/wanton distinction; remand advised)