Affiliated FM Ins. Co. v. LTK Consulting Servs., Inc., No. 07-35696

Negligent Construction Advice Lawsuit

In Affiliated FM Ins. Co. v. LTK Consulting Servs., Inc., No. 07-35696, an action asserting that defendant provided negligent design advice to the Seattle Monorail System that resulted in fire damage, the court reversed summary judgment for defendant where a party with a contractual right to operate commercially and extensively on another's property may bring a suit in tort against a third party for damage to that property.

As the court wrote:  "Affiliated FM Insurance Company ("AFM"), subrogated to the rights of its insured, Seattle Monorail Services Joint Venture ("SMS"), sued LTK Consulting Services Inc. ("LTK"), asserting that LTK had provided negligent design advice to the Seattle Monorail System that resulted in fire damage. LTK took the position that the so-called "economic loss rule" precluded this suit and that AFM did not have an adequate interest in the Monorail System on which to base a suit in tort."

Related Resources

• Read the Ninth Circuit's Decision in Affiliated FM Ins. Co. v. LTK Consulting Servs., Inc., No. 07-35696