Subrogation plaintiffs obtain reversal in Appellate Division: questions of fact including whether auto dealership negligently performed vehicle recall

Utica Mutual Insurance Company v. Ford Motor Company, et al., __ A.D.3d __ (2nd Dep't May 4, 2016)

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A motion court erred in granting the defendant auto dealership's motion for summary judgment, as there existed questions of fact concerning its negligence in carrying out an automaker's recall, and the Appellate Division, Second Department, reversed the court's order.

The claim involved a fire in the plaintiff's insured's garage, where the insured's Lincoln Town Car was parked. The vehicle had been purchased from the defendant dealer, but later Ford Motor Company issued a recall notice concerning the vehicle's cruise control system. The notice indicated that a malfunction could cause an underhood fire, even when the vehicle was not being operated. In response, the insured brought the vehicle to the dealership for service on two occasions. Nevertheless, a fire ignited subsequently in the engine compartment of the vehicle, causing extensive damage to the insured's vehicle, garage, and home. Plaintiffs commenced this action, alleging that the dealership negligently performed recall service on the vehicle and was strictly liable for the sale of a defective product. The dealership moved for summary judgment dismissing the complaint as against it, which was granted.

The Appellate Division unanimously reversed, finding that, although the defendant established its prima facie case, plaintiffs had raised triable issues of fact barring summary judgment. These included whether the dealership negligently performed the recall service on the vehicle under a theory of res ipsa loquitur; whether the dealership's alleged negligence was a proximate cause of the fire; and whether defendant could be held strictly liable for the sale of a defective product.

The Court also rejected the contention that the appeal was barred by the doctrine of law of the case. An earlier order relied upon by the defendant did not address the precise question raised on the dealership's motion; and in any event, the Appellate Division was not bound by the Supreme Court's prior order.

AGF&J partner Chris Christofides represents the plaintiffs, and he briefed and argued the appeal.