Facts

In November 2003, defendant Simplex Grinnell LP (Simplex) inspected the fire suppression system in cross-defendant Lakehouse Pizza Inc.'s Tahoe City Restaurant (Lakehouse). On Aug. 4, 2004, the restaurant caught fire and was a total loss. It had to be rebuilt at a cost of $2.5 million. Plaintiff Travelers Property Casualty Company of America (Travelers) brought a subrogation action after paying the loss. At trial, the scope of Simplex's work, the application and interpretation of building and fire codes, and the determination of how the fire spread were at issue.

PLAINTIFF'S CONTENTIONS:
Travelers claimed that not all appliances were protected by a suppression system. Particularly, the pizza oven exhaust system was not protected, and Simplex did not recommend it to be. Had Simplex properly protected the pizza oven exhaust, the fire would have been extinguished. Had Simplex recommended this action and Lakehouse still refused, the fire department should have been notified.

DEFENDANT'S CONTENTIONS:
Simplex claimed that pizza ovens are not typically covered by suppression systems and the scope of their inspection correctly did not include an inspection of the oven. Simplex further claimed that, if it was liable to Travelers, then Lakehouse was contractually obligated to indemnify Simplex.

CROSS-DEFENDANT'S

Settlement Discussions

Simplex offered a $250 C.C.P. section 998 in early litigation and a $50,000 C.C.P. section 998 two weeks before trial. Travelers countered with a demand of $600,000 via C.C.P. Section 998.

Damages

Travelers sought $2,586,068 in property damage.

Result

The jury returned a verdict for Simplex. Travelers settled with all other parties prior to trial in two mediations.

Deliberation

two hours

Poll

11-1