The Subrogation Strategist

The Supreme Court of Utah recently found that an incorrect pre-construction geotechnical engineering report is a “defective design.” Thus, actions arising from an incorrect geotechnical report are appropriately governed by Utah’s Economic Loss Statute (Statute), Utah Code Ann. § 78B-4-513(1).Continue Reading

Earlier this summer, in Gables & Villas at River Oaks Homeowners Ass’n v. Castlewood Builders LLC, 2018 UT 28, the Supreme Court of Utah addressed the question of whether the plaintiff’s construction defects claims against the general contractor for a construction project were timely-filed, or barred by the statute of repose. In Utah, the statute of repose requires that an action be “commenced within six years of the date of completion.” The plaintiff alleged that its 2014 amended complaint naming the general contractor as a defendant was timely-commenced because, before the date on which Utah’s statute of repose ran, a defendant filed a motion to amend its third-party complaint to name the general contractor as a defendant, and the defendant subsequently assigned its claims to the plaintiff. The plaintiff argued that the filing of its 2014 amended complaint related back[1] to the date of its original complaint. The Supreme Court disagreed, holding that an action is “commenced” by filing a complaint and that a motion for leave to amend does not count as “commencing” an action.Continue Reading

In Wilson v. Educators Mut. Ins. Ass’n, 2017 UT 69, the Supreme Court of Utah considered whether an insurer had the right to bring a subrogation action in its own name despite the fact that its insured had not yet been made whole. The court held that, although the common law made whole doctrine generally bars an insurer from proceeding in its own name until after the insured has been made whole, the terms of an insured’s insurance policy can change the made whole doctrine. The Wilson case highlights the importance of reviewing the applicable insurance policy, in conjunction with the law of the applicable jurisdiction, to determine an insurer’s subrogation rights.Continue Reading

When an insurer files a subrogation suit in the insured’s name, questions often arise with respect to whether, by doing so, the insurer has to respond to discovery issued to the insured. In Aquatherm, LLC v. Centimark Corporation, 2017 U.S. Dist. LEXIS 85173 (C.D. Utah June 2, 2017), a case in which the insurer at issue made the insured whole, the District Court for the District of Utah answered the question in the negative.Continue Reading