Insurance Company Appeals Suit Asking CNH Industrial to Pay Damages After Tractor Fire

The Eighth Circuit Court of Appeals received an appeal on Monday from the Northern District of Iowa of a dispute over who is liable for damages after a tractor caught fire.  The lawsuit began when the insurance company argued that the manufacturer should be liable for the funds it paid after the tractor was destroyed by a fire it caused. 

An order signed by Judge C. J. Williams in December found that the court did not have subject matter jurisdiction for the case and dismissed a motion to strike testimony, a motion for summary judgment, and the plaintiff’s claims. The plaintiff, Floyd County Mutual Insurance Association, as a subrogee of Clark R. McGregor, Ronald R. McGregor Revocable Trust, and McGregor Farms, Inc., filed an appeal in the lawsuit shortly after the decision. 

The insurance company, according to the Order, issued a policy to McGregor Farms covering the tractor, which was manufactured by the defendant, CNH Industrial America. The tractor reportedly caught fire in September 2017 while being used to harvest a soybean crop.  The order said that the fire caused $167,787.81 in damage, a large majority of which was damages to the tractor and other amounts for damage to the tillage implement and personal property on the tractor. 

The insurance company reportedly paid McGregor Farms for the damages, complying with the agreement of the insurance policy, and then filed a complaint against the defendant with claims of negligence, breach of warranty, strict liability, and failure to warn.  The claims of breach of warranty were later dismissed as the warranties on the machine had expired before the fire.  The other claims were dismissed by the court based on the economic loss doctrine, but was granted the ability to file an amended complaint to assert damages that may not be barred under this doctrine. The claims in the amended complaint were dismissed in December. 

The Eighth Circuit determined that a transcript in the case is due before February 22 and the plaintiff and appellant’s brief is due by March 2. 

Floyd County Mutual Insurance Association is represented by Yost & Baill LLP and CNH Industrial America is represented by Lederer Weston & Craig and Frost Brown Todd