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Indemnity Insurance Company of North America A/S/O Unionville-Chadds Ford School District v. Electrolux Home Products

December 7, 2011

INDEMNITY INSURANCE COMPANY OF NORTH AMERICA A/S/O UNIONVILLE-CHADDS FORD SCHOOL DISTRICT
v.
ELECTROLUX HOME PRODUCTS, INC.



The opinion of the court was delivered by: Surrick, J.

MEMORANDUM

Presently before the Court is Defendant Electrolux Home Products, Inc.'s Motion for Summary Judgment. (Def.'s Mot. Summ. J., ECF No. 17.) For the following reasons, the Motion will be granted in part and denied in part.

I. BACKGROUND

A. Procedural History

The Unionville-Chadds Ford School District ("School District"), which operates Unionville High School ("High School"), filed an insurance claim with Plaintiff, the Indemnity Insurance Company of North America, to recoup the costs of repair and restoration incurred as a result of a fire. Those costs are approximately $770,000. (Compl. ¶¶ 11, 12.) Plaintiff, as subrogee of the School District, seeks to recover this amount from Defendant on theories of strict product liability and breach of warranty.

On August 16, 2010, Plaintiff filed a Complaint against Defendant alleging negligence, strict liability, and breach of express and implied warranties. (ECF No. 1.)*fn1 Defendant filed an Answer, denying liability under all of Plaintiff's theories. (ECF No. 4.) On October 4, 2011, Defendant filed the instant Motion for Summary Judgment on all counts, and in the alternative, for a spoliation inference against Plaintiff for failure to preserve evidence. Defendant contends that summary judgment should be granted on Plaintiffs strict liability claim and its breach of warranty claims because Plaintiff has failed to present a prima facie case based upon the malfunction theory of product liability. Defendant argues that Plaintiff has failed to present evidence, either direct or circumstantial, that Defendant's product, a compact Frigidaire refrigerator, was defective when it left the Defendant's control. Defendant also argues that summary judgment is an appropriate sanction for Plaintiff's spoliation of evidence. On October 31, 2011, Plaintiff filed its response. (ECF No. 18.) Argument was held on December 2, 2011.

B. Factual Background

This lawsuit was filed as a result of the fire that occurred on the afternoon of July 23, 2009, at the High School, located at 750 Unionville Road in Kennett Square, Pennsylvania. The fire caused significant damage to a hallway known as the "Yellow Hallway" or the "Yellow Mat Hallway" which was located adjacent to the school's gymnasium. The school was in the middle of summer vacation, and there were few people present at the time of the fire. No individuals were injured in the fire, but the hallway sustained substantial damage. (Owens Dep. 35, Pl.'s Resp. Ex. C.) Seven minutes after the first alarm, firefighters from the Po-Mar-Lin Fire Company arrived at the scene. (Fire Incident Report 1, ECF No. 17-6.) The fire was brought under control quickly. (Id.) Trooper David Cornetta of the Pennsylvania State Police, Fire Marshal Charles Owens, and Fire Marshal Russell Kilmer were present at the scene.

Prior to the fire, various items had been moved into the hallway while the school's custodial crew was waxing the gymnasium floor, cleaning adjacent rooms, and completing several other renovation projects in areas near the gymnasium. (Iezzi Dep. 31-32, ECF No. 17-2.) The renovation did not include any electrical work. (McLimans Dep 11., ECF No. 17-4.) Among the items moved into the hallway was a Frigidaire brand compact refrigerator-freezer, manufactured by Defendant.*fn2 (Kline Dep. 21, ECF No. 17-5.) The refrigerator had been purchased by the school's head athletic trainer, Steven Iezzi, in early 2008, and was being used to store ice packs and sports drinks for the school's volleyball team. (Iezzi Dep. 13, 28.) Although the refrigerator was usually located in Iezzi's office, which was near the Yellow Hallway and the gymnasium, it had been moved to the hallway during the renovation (Kline Dep. 17.) The refrigerator had been unplugged for the summer recess; however, when it was moved out of Iezzi's office into the Yellow Hallway it was plugged in again. (Iezzi Dep. 16; Kline Dep. 21.) Also located in the hallway were an electrically powered water fountain, several plastic mats, a plastic cart, and a small metal can. (Redsicker Dep. 34-35, ECF No. 17-8.) The remains of these items were found in the Yellow Hallway after the fire. (Id.)

The trained fire investigators determined that the fire "originated in the area of the portable refrigerator." (Cornetta Dep. 44, Pl.'s Resp. Ex. B.) The Fire Incident Report, which was filed immediately following the initial investigation, declared the cause of ignition to be a failure of equipment, and noted that the source of heat was "electric arcing." (Fire Incident Report 4.) Po-Mar-Lin Fire Company Chief Donald E. Wells, in a written summary attached to the Fire Incident Report, determined that the cause of the fire was electrical, and mentioned that ignition occurred near the refrigerator. (Id. at 5.) The Fire Incident Report dismissed the possibility that human factors contributed to ignition, effectively eliminating arson and careless smoking as a possibility. (Id. at 4.)

In his deposition, Fire Marshal Kilmer noted that the fire had no "obvious cause." (Kilmer Dep. 61.) Kilmer stated that although the fire marshals did not believe that the cause of the fire was spontaneous combustion, they could not rule it out as a possibility. (Id. at 62.) Kilmer further noted that neither flammable materials nor cleaning supplies were found in the hallway, reducing the odds of spontaneous combustion. (Id. at 63.) No flammable substances were being stored or used in the hallway at the time of the event. (Kline Dep. 23; Hostetler Dep. 24, ECF No. 17-3; McLimans Dep. 26-27.)

On July 28, 2009, SEA Ltd. ("SEA") was hired by School Claims Services, Inc., on Plaintiff's behalf, to "render . . . professional opinions regarding the origin and cause of the fire." (SEA Report 1.) The investigation was assigned to Aaron Redsicker, a Certified Fire Investigator (CFI). Redsicker collaborated with SEA Project Engineer Robert Neary, an electrical engineer, in preparing a report on the causes of the fire. In their report, Redsicker and Neary concluded that "the fire originated inside a compact Frigidaire refrigerator," and that the "source of the ignition was an electrical short-circuiting event on the copper conductor that connected the temperature control device to the compressor relay." (Id.) According to the SEA report, an electrical arcing event triggered by a defect in the conductor ignited nearby combustible materials. (Id.; Redsicker Dep. 73.) The SEA investigators considered, and eliminated, other potential sources of ignition, such as the water fountain's power cord and the refrigerator's power cord. (Redsicker Dep. 48-49; Neary Dep. 38.)

SEA investigators documented the presence of a metal can in the Yellow Hallway. (Redsicker Dep. 36-37.) According to Redsicker, the can had caved in, with cloth remains inside. (Id. at 35.) The cloth was likely gauze or cotton. (Id. at 76-77.) Redsicker noted that some of the cloth was unburned, and that while the outside of the can had suffered significant fire damage, the interior of the can had not sustained the same level of oxidization. (Id. at 36-37.) Redsicker concluded that if the fire had originated inside the can, the contents of the can would have been consumed. (Id. at 61, 81.)

Redsicker expressed concern that evidence might not be preserved if he left the scene of the fire, because the approaching school year required that restoration and repair of the premises begin immediately. (Id. at 28.) Redsicker decided to remove several items from the premises. (Id. at 53-56.) Specifically, Redsicker removed three items which were later examined in the presence of Defendant's counsel on March 17, 2011. (SEA Report 10.) The three items included the water fountain, which had been mounted on the wall along with its power cord, the refrigerator, along with its power cord, and some burnt paper and cloth remains. The burnt paper came from outside the metal can and the cloth remains came from inside the metal can. The paper and cloth were commingled. (SEA Report 10.) Redsicker did not remove the metal can because it had been nearly destroyed in the fire, was stuck to the floor, and because he did not believe the can itself would be of any material value. (Redsicker Dep. 36, 56.) In the days and weeks following the fire, the hallway was cleaned and restored with the assistance of the BELFOR Corporation, a company that specializes in disaster recovery. (Kline Dep. 51.) The whereabouts of the metal can is unknown.

Ultimately, some months after Redsicker had conducted his investigation, Plaintiff notified Defendant of the fire, and that the refrigerator manufactured by Defendant was the cause of the fire. Thereafter, Defendant contacted Engineering Systems, Inc. (ESI) and asked the company to investigate "the possible involvement of a refrigerator" in causing the fire. (ESI Report 3.) Thomas Bajzek, an electrical engineer and ESI's expert, considered all of the evidence available and reached the following conclusions:

1. The origin of the fire was not in the compressor compartment of the subject refrigerator.

2. There is no evidence of any failure or defect in the subject refrigerator as ...


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