In Secura Insurance v. Super Products, LLC (2018AP1600), the Court of Appeals District II held that the economic loss doctrine bars recovery for damage to contracted property, even if there was injury to other property.
Wisconsin Utility Exposure purchased an excavator from Super Products. The excavator caused a fire that damaged the excavator itself and a variety of other items. Secura, Wisconsin Utility Exposure’s insurer, paid for the damages to its insured then filed the instant negligence lawsuit against Super Products. Super Products sought to dismiss the claims under the economic loss doctrine.
The economic loss doctrine typically bars lawsuits seeking to recover solely economic losses arising from the nonperformance of a contract, in this case the defective purchased product. Damages to “other property,” in this case the variety of other items damaged in the fire, are exempt from the economic loss doctrine and can be recovered. Secura argued the economic loss doctrine did not apply because the damage to the other property allows for recovery for the defective product.
The court rejected Secura’s reading of previous case law and held that the economic loss doctrine barred Secura’s claims for recovery of damages to the excavator. Secura could recover damages for injury to the other property, but that exempt claim did not open damages to the contracted property for recovery.