Board of Commissioners of Jefferson County v. Teton Corporation, et al. - 11/21/13

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Thursday  November 21, 2013 
1:30 PM  EST

1:30 p.m. 72A04-1302-CT-55. The Jefferson County Board of Commissioners (“County Commissioners”) entered into a standard American Institute of Architects contract (“AIA contract”) with Teton Corporation for renovations to the Jefferson County Courthouse.  The AIA contract required the County Commissioners to provide builder’s risk insurance for the renovation project, but the County Commissioners decided to rely on the general policy of insurance maintained by Jefferson County instead, and did not notify Teton Corporation that they did not obtain the insurance coverage required by the AIA contract. The AIA contract between the parties also provided for a mutual waiver of the right to subrogation between and among the County Commissioners, Teton Corporation, and all subcontractors.

A fire during the renovation caused significant damage to the courthouse.  The County Commissioners filed a complaint against Teton and its subcontractors arguing that the County was entitled to damages not covered by insurance and to “non-Work property damage.”  Summary judgment proceedings ensued, and the trial court granted Teton’s and its subcontractors’ motions for summary judgment.  The County Commissioners appeal and argue that although under the AIA contract they waived their subrogation claims for damages to “work property”, they may still claim damages to “non-Work property” and litigate whether they may also claim for damages caused by gross negligence or willful and wanton acts.

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