Title: Town of Stowe v. Stowe Theatre Guild

State: vermont

Issuer: Vermont Supreme Court

Document:

Town of Stowe v. Stowe Theatre Guild (2005-060); 180 Vt. 165; 908 A.2d 447

2006 VT 79

[Filed 04-Aug-2006]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revisiov before publicatiov iv the Vermovt
  Reports.  Readers are requested to votify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.

                                 2006 VT 79

                                No. 2005-060

  Town of Stowe                                  Supreme Court

                                                 On Appeal from
       v.                                        Lamoille Superior Court


  Stowe Theatre Guild                            November Term, 2005


  Howard E. Van Benthuysen, J.

  William W. Cobb of Williams and Green, P.C., Morrisville, and David S.
    Huberman of White and Williams LLP, Philadelphia, Pennsylvania, for
    Plaintiff-Appellee.

  Gregory S. Clayton of Aten Clayton & Eaton PLLC, Littleton, New Hampshire,
    for  Defendant-Appellant.


  PRESENT:  Reiber, C.J., Dooley, Johnson, Skoglund and Burgess, JJ.

       ¶  1.  BURGESS, J.   In this subrogation action, the Town of Stowe's
  insurer, Royal Insurance Co. (Royal), seeks to recover damages from
  defendant, Stowe Theatre Guild, for negligently causing a fire in a town
  building where defendant leased performance space.  Defendant claims the
  superior court erred in denying its motion for summary judgment and holding
  that it is not a coinsured under the Town of Stowe's property insurance
  policy.  We granted the parties' joint request for interlocutory review of
  the superior court's summary judgment ruling, and we affirm.
   
       ¶  2.  We review de novo the superior court's denial of summary
  judgment.  Concord Gen. Mut. Ins. Co. v. Woods, 2003 VT 33, ¶ 5, 175 Vt.
  212, 824 A.2d 572.  Summary judgment is appropriate only where the moving
  party demonstrates that there are no genuine issues of material fact and
  the movant is entitled to judgment as a matter of law.  Id.  The following
  facts are not in dispute.

       ¶  3.  Defendant is a nonprofit community theater group, managed by a
  board comprised mostly of Stowe taxpayers, that has used the auditorium of
  the Akely Memorial Building in Stowe since 1995 under an oral lease
  agreement.  The building houses various town offices and the Stowe
  Historical Society as well as the auditorium.  In exchange for seasonal use
  of the auditorium, defendant agreed to pay the Town one dollar annually and
  to make various improvements to the auditorium and stage that would remain
  with the building.  The agreement contained no other express terms.  Since
  the inception of the agreement, defendant's improvements to the auditorium
  have included a new air conditioning system, lighting, sound equipment,
  curtains, electrical upgrades, refinished paneling, and refurbished
  dressing rooms.  The Town purchased fire insurance from Royal.  Defendant
  purchased its own liability insurance.  
   
       ¶  4.  In July 2000, defendant used a pyrotechnic device-theatrical
  flash powder-during a musical production.  Defendant's negligent use of the
  flash powder resulted in a fire that activated the sprinkler system and
  caused significant water damage to the building. (FN1)  Royal paid the Town's
  claim for damages and then commenced this subrogation action against
  defendant in the Town's name.  Defendant moved for summary judgment,
  arguing, as it does now on appeal, that the subrogation action was barred
  because defendant should be treated as a coinsured under the Town's
  insurance.  Defendant argues that it should be deemed a coinsured as a
  matter or equity, by virtue of its lease with the Town, and because
  defendant is a member of the public.

       ¶  5.  Because defendant invokes equity to support its claimed
  protection against the subrogation claim of the landlord's insurer, we
  briefly review the equitable principles of subrogation.  As explained in
  Union Mutual Fire Insurance Co. v. Joerg, 2003 VT 27, 175 Vt. 196,