Pacific Employer's Insurance Co. v. Austgen's Electric, Inc.

661 N.E.2d 1227, 1996 Ind. App. LEXIS 142, 1996 WL 72640
CourtIndiana Court of Appeals
DecidedFebruary 21, 1996
Docket46A03-9505-CV-156
StatusPublished
Cited by4 cases

This text of 661 N.E.2d 1227 (Pacific Employer's Insurance Co. v. Austgen's Electric, Inc.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pacific Employer's Insurance Co. v. Austgen's Electric, Inc., 661 N.E.2d 1227, 1996 Ind. App. LEXIS 142, 1996 WL 72640 (Ind. Ct. App. 1996).

Opinion

OPINION

STATON, Judge.

Pacific Employer’s Insurance Co., Cigna-INA/Aetna Insurance Co., as subrogees of Portage Township Schools, a corporation, Gainer Bank T/U/T No. P4040 & 2nd Consolidated School Building Corporation (collectively “Pacific”) appeal from the grant of judgment on the evidence in favor of Aust-gen’s Electric, Inc. (“Austgen”). Pacific raises three issues for appellate review which we consolidate into one and restate as: whether the trial court erred in granting Austgen’s motion for judgment on the evidence.

We reverse and remand. 1

The facts most favorable to the nonmovant, Pacific, reveal that in May 1985, the Portage Township Schools entered into a written contract with Austgen for installation of a fire alarm system pursuant to a renovation project at the Fegely Middle School (“the School”). This system was designed to provide alarms and noise devices in the school, and included an automatic telephone dialer which would engage when the fire alarm system was activated. The dialer would call the fire emergency dispatcher at the local police department and play a taped message regarding an active fire alarm within the school.

In January 1988, Austgen was notified that the automatic dialer was not functioning properly. Austgen investigated the problem and concluded that there was a problem with the School’s dedicated phone line. A school employee found the phone line to be fully operational and in early February 1988, the School notified Austgen that the automatic dialer was still malfunctioning.

At some point during the early morning of February 23, 1988, three young men broke into the school and set fire to some wood in the School’s Industrial Arts Room which then spread to other areas of the School. The automatic dialer did not engage and the fire went undetected until a school employee arrived for work at approximately 5:00 a.m. The fire department was called to the scene and extinguished the fire. As a result, the School incurred property damages of $203,-699.05.

In February 1990, Pacific, as subrogee of the Portage Township Schools, brought a subrogation action against Austgen for breach of contract, breach of implied and express warranty, products liability, and negligence. In February 1994, Austgen filed a motion for summary judgment, alleging that no genuine issue of material fact existed. The trial court denied Austgen’s motion and the matter was tried before a jury in January 1995. At the close of Pacific’s case, Austgen moved for a judgment on the evidence pursuant to Indiana Trial Rule 50. The trial court granted Austgen’s motion, finding as follows:

* ⅜ * ⅜ ⅜ ⅜
*1229 THE COURT NOW FINDS that in a comparatively few cases dealing with the issue, it has been held, without exception, that a person furnishing, installing or maintaining an automatic burglary alarm or watchman supervising system is not liable for a burglary loss sustained by one to whom such services is furnished, even though there was negligence in the installation or maintenance of the services or there was a breach of the contract with respect to the services to be furnished upon the theory that such negligence or breach is not the proximate cause of the loss.
THE COURT FINDS that the Motion for Judgment on the evidence should be granted. And Judgment should be rendered thereon.

Record, p. 437. Pacific now appeals.

Pacific contends that the trial court erred in granting Austgen’s motion for judgment on the evidence. Indiana Trial Rule 50(A) provides that a party may move for a judgment on the evidence after the party carrying the burden of proof has failed to present sufficient evidence to support its claim. The purpose of a motion for judgment on the evidence is to test the sufficiency of the evidence. Dallas Moser Transporters, Inc. v. Ensign, 594 N.E.2d 454, 456 (Ind.Ct.App.1992), reh. denied.

In reviewing the grant of judgment on the evidence, we consider only the evidence and the reasonable inferences most favorable to the nonmoving party. Ross v. Lowe, 619 N.E.2d 911, 914 (Ind.1993). The evidence must support without conflict only one inference which is in favor of the defendant. Id. If there is any probative evidence or reasonable inference to be drawn from the evidence in favor of the plaintiff or if there is evidence allowing reasonable people to differ as to the result, judgment on the evidence is improper. Id.

Pacific contends that the trial court erred in concluding that Austgen’s negligence in failing to properly install the automatic dialer could not have proximately caused the damages to the School. To recover on a theory of negligence, a plaintiff must establish three elements: (1) a duty on the part of the defendant to conform his conduct to a standard of care arising from his relationship with the plaintiff; (2) a failure of the defendant to conform his conduct to the requisite standard of care required by the relationship; and (3) an injury to the plaintiff proximately caused by the breach. Webb v. Jarvis, 575 N.E.2d 992, 995 (Ind.1991), reh. denied.

Pacific argues that it presented evidence which sufficiently showed that, but for the malfunctioning automatic dialer, the fire department would have immediately responded to and extinguished the fire, mitigating the property damage to the School. Austgen counters that the contract only required it to install the fire alarm system and that it had no ongoing duty to control or monitor its operation. Moreover, Austgen claims that any duty it may have had was extinguished by the intentional, criminal act of the arsonists.

This case presents a question of first impression before our courts: whether there is a causal nexus between the negligent installation of a fire alarm system and fire damages resulting from arson.

In an action for negligence, an injury will be proximately caused by either a negligent act or the omission of a duty to act. The injury must be the natural and probable consequence, in light of the circumstances, that should have been reasonably foreseen or anticipated. This is true regardless of earlier acts of negligence. Bob Schwartz Ford, Inc. v. Dunham, 631 N.E.2d 953, 956 (Ind.Ct. pp. 1994). The requirement that the injury was foreseeable is directly related to the rule that an intervening cause may serve to sever the liability of one whose original acts sets in motion the chain of events leading to the injury. Id. A superseding intervening cause sufficient to break the causal chain between wrongful conduct and injury must be one that is not “foreseeable” at the time of the wrongful conduct. Walker v. Rinck, 604 N.E.2d 591, 596 (Ind.1992).

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661 N.E.2d 1227, 1996 Ind. App. LEXIS 142, 1996 WL 72640, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pacific-employers-insurance-co-v-austgens-electric-inc-indctapp-1996.