Court of Appeals of Indiana | Opinion 18A-CT-1466 | December 28, 2018 Page 1 of 9

ATTORNEYS FOR APPELLANTS

Thomas J. Jarzyniecki, Jr.

Jennifer M. Van Dame

Kightlinger & Gray, LLP

Indianapolis, Indiana

Crystal G. Rowe

Kightlinger & Gray, LLP

New Albany, Indiana

ATTORNEYS FOR APPELLEE

Catherine Siebecker

Doug Fisher

Law Offices

The Cincinnati Insurance 

Company

Indianapolis, Indiana

I N T H E

COURT OF APPEALS OF INDIANA

Robert Youell and

Best One Giant Tire, Inc.,

Appellants-Defendants,

v.

The Cincinnati Insurance 

Company a/s/o Greg Dotson,

Appellee-Plaintiff

December 28, 2018

Court of Appeals Case No.

18A-CT-1466

Appeal from the Marion Superior 

Court

The Honorable James B. Osborn, 

Judge

Trial Court Cause No.

49D14-1708-CT-30209

Vaidik, Chief Judge.
Court of Appeals of Indiana | Opinion 18A-CT-1466 | December 28, 2018 Page 2 of 9

Case Summary

[1] A landlord and a tenant entered into a commercial lease that provided that the 

landlord would insure the building and the tenant would insure its personal 

property inside the building. When the property was later damaged by fire, the 

landlord’s insurance covered the loss. The landlord’s insurer later filed a 

subrogation action against the tenant to recover the amount paid. The tenant 

filed a motion for judgment on the pleadings, arguing that the landlord’s 

agreement to obtain property insurance was an agreement to provide both 

parties with the benefits of insurance and expressly allocated the risk of loss in 

case of fire to insurance, thereby barring a subrogation action as a matter of 

law. The trial court denied the motion, and the tenant now appeals. We 

reverse and remand. 

Facts and Procedural History

[2] In 2013, Greg Dotson (“Landlord”) leased a commercial building on West 

Washington Street in Indianapolis to Robert Youell and Best One Giant Tire, 

Inc. (referred to collectively as “Tenant”). The Commercial Lease Agreement 

addressed insurance as follows:

8. Insurance

A. If the Leased Premises or any other party [sic] of the Building 

is damaged by fire or other casualty resulting from any act or 

negligence of Tenant or any of Tenant’s agents, employees or 

invitees, rent shall not be diminished or abated while such 
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damages are under repair, and Tenant shall be responsible for the 

costs of repair not covered by insurance.

B. Landlord shall maintain fire and extended coverage 

insurance on the Building and the Leased Premises in such 

amounts as Landlord shall deem appropriate. Tenant shall be 

responsible, at its expense, for fire and extended coverage 

insurance on all of its personal property, including removable 

trade fixtures, located in the Leased Premises. 

C. Tenant and Landlord shall, each at its own expense, maintain 

a policy or policies of comprehensive general liability insurance 

with respect to the respective activities of each in the Building 

with the premiums thereon fully paid on or before due date, 

issued by and binding upon some insurance company approved 

by Landlord, such insurance to afford minimum protection of not 

less than $1,000,000 combined single limit coverage of bodily 

injury, property damage or combination thereof. Landlord shall 

be listed as an additional insured on Tenant’s policy or policies of 

comprehensive general liability insurance, and Tenant shall 

provide Landlord with current Certificates of Insurance 

evidencing Tenant’s compliance with this Paragraph. Tenant 

shall obtain the agreement of Tenant’s insurers to notify 

Landlord that a policy is due to expire at least [ten] (10) days 

prior to such expiration. Landlord shall not be required to 

maintain insurance against thefts within the Leased Premises or 

the Building.

Appellants’ App. Vol. II p. 15 (emphasis added). In accordance with the lease, 

Landlord maintained property insurance on the building through a policy with 

The Cincinnati Insurance Company (CIC). 
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[3] On August 8, 2015, a fire occurred at the building. Pursuant to Landlord’s 

insurance policy, CIC paid Landlord $227,653 for damages to the building. In 

August 2017, CIC, as subrogee of Landlord, filed a complaint against Tenant to 

recover that amount. CIC attached the Commercial Lease Agreement to its 

complaint. 

[4] Thereafter, Tenant filed a motion for judgment on the pleadings, arguing that 

CIC had no right to pursue the subrogation claim because Landlord’s

agreement to provide property insurance was an agreement to provide both 

parties with the benefits of insurance. The trial court denied Tenant’s motion. 

Appellants’ App. Vol. II p. 9. 

[5] At Tenant’s request, the trial court certified its order for interlocutory appeal, 

and this Court accepted jurisdiction of the appeal.

Discussion and Decision

[6] Tenant contends that the trial court should have granted its motion for 

judgment on the pleadings. According to Indiana Trial Rule 12(C), after the 

pleadings are closed but within such time as not to delay the trial, any party 

may move for judgment on the pleadings. A written instrument attached to a 

pleading is considered a part of that pleading. Ind. Trial Rule 10(C). 

A motion for judgment on the pleadings is typically directed toward a 

determination of the substantive merits of the controversy. Mourning v. Allison 

Transmission, Inc., 72 N.E.3d 482, 486 (Ind. Ct. App. 2017). Such motions 
Court of Appeals of Indiana | Opinion 18A-CT-1466 | December 28, 2018 Page 5 of 9

should be granted only where it is clear from the face of the complaint that 

under no circumstances could relief be granted. Id.; see also ESPN, Inc. v. Univ. of 

Notre Dame Police Dep’t, 62 N.E.3d 1192, 1195 (Ind. 2016) (judgment on the 

pleadings should be granted only “where it is clear from the face of the 

pleadings that one party is entitled to prevail as a matter of law”). We review 

the trial court’s ruling on such motions de novo. ESPN, 62 N.E.3d at 1195. 

[7] In addition, a lease is construed in the same manner as any other contract. T-3 

Martinsville, LLC v. US Holding, LLC, 911 N.E.2d 100, 111 (Ind. Ct. App. 

2009), aff’d on reh’g, trans. denied. When construing the meaning of a contract, 

our primary task is to determine and effectuate the intent of the 

parties. Id. First, we must determine whether the language of the contract is 

ambiguous. Id. The unambiguous language of a contract is conclusive upon 

the parties to the contract and upon the courts. Id. If the language of the 

instrument is unambiguous, the parties’ intent will be determined from the four 

corners of the contract. Id. If, on the other hand, a contract is ambiguous, its 

meaning must be determined by examining extrinsic evidence and its 

construction is a matter for the fact-finder. Id.

[8] Tenant asserts that Morsches Lumber, Inc. v. Probst, 180 Ind. App. 202, 388 

N.E.2d 284 (Ind. Ct. App. 1979), is controlling here. In that case, the parties 

entered into a contract for the construction of a pole barn. According to the 

contract, the landowner was required to obtain property insurance for fire and 

windstorm damage and the builder was required to obtain general liability 

insurance. When a windstorm later destroyed the barn during construction, the 
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landowner’s insurance covered only 75% of the loss. The landowner then filed 

suit against the builder, alleging that the builder’s negligence was the proximate 

cause of the barn’s destruction. The builder responded that regardless of any 

negligence on its part, neither the landowner nor his insurer as subrogee could 

bring an action for a loss that the parties agreed would be allocated to 

insurance. We agreed with the builder, reasoning:

[A]n agreement to insure is an agreement to provide both parties 

with the benefits of insurance. Individuals understand that 

insurance will protect them against the consequences of their 

own negligence and more than likely assume that if one who is a 

party to a contract agrees as part of his or its duties to provide 

insurance, that the insurance will protect both of them regardless 

of the cause of the loss (excepting, of course, wanton and willful 

acts). If that were not their intent, each would provide his or its 

own insurance protection and there would be no need for the 

contract to place the duty on one of them.

Id. at 287. Accordingly, we held that the landowner was “limited in his 

recovery to the proceeds of the insurance policy. The fact that he failed to take 

out a policy sufficient to cover the cost of the undertaking is a cost he will have 

to bear.” Id.; see also Woodruff v. Wilson Oil Co., 178 Ind. App. 428, 382 N.E.2d 

1009 (1978) (holding that a contract requiring the lessors to obtain fire 

insurance for the leased property was for the benefit of both the lessors and the 

lessee and therefore the lessors were limited in recovery to the insurance 

proceeds). 
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[9] We agree with Tenant that Morsches Lumber is controlling here. Like the 

contract in Morsches Lumber, here the Commercial Lease Agreement

unambiguously provides that Landlord would insure the building and Tenant 

would insure its personal property inside the building.

1

 Appellants’ App. Vol. II 

p. 33. Landlord and Tenant’s agreement to insure was thus an agreement to 

provide both parties with the benefits of the insurance and expressly allocated 

the risk of loss in case of fire to insurance. See Morsches Lumber, 388 N.E.2d at 

287 (“With agreements to insure, the risk of loss is not intended to be shifted to 

one of the parties; it is intended to be shifted to an insurance company in return 

for a premium payment. Neither party intends to assume a potential liability; 

rather both are demonstrating ‘normal’ business foresight in avoiding liability 

and allocating it to an insurer.”). And just like the landowner in Morsches 

Lumber, Landlord is limited in its recovery to the insurance proceeds. And 

because CIC stands in the shoes of Landlord and takes no rights other than 

those that Landlord had, CIC has no subrogation rights against Tenant. Ind. 

Erectors, Inc. v. Trs. of Ind. Univ., 686 N.E.2d 878, 880 (Ind. Ct. App. 1997) 

(“[T]he party who agreed to purchase insurance has no cause of action against 

the party for whose benefit the insurance was intended regardless of the fault of 

this intended insured. And, as the rights of a subrogated insurer can rise no 

 

1 Landlord asserts that the lease is ambiguous because (1) the lease did not specify the amount of property 

insurance to be obtained (but rather left it to the discretion of Landlord) and (2) the lease did not explicitly 

rule out subrogation. But as Tenant points out, the contract in Morsches Lumber neither specified the amount 

of property insurance to be obtained nor explicitly ruled out subrogation. The lease is not ambiguous for 

these reasons. 
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higher than the rights of its insured, the first party’s insurance carrier has no 

subrogation cause of action against the intended insured.” (citations omitted)), 

reh’g denied; Farm Bureau Ins. Co. v. Allstate Ins. Co., 765 N.E.2d 651, 656-57 (Ind. 

Ct. App. 2002), aff’d on reh’g, trans. denied. 

[10] Despite Tenant’s explicit reliance on Morsches Lumber in its brief, CIC does not 

attempt to distinguish it, or even cite it, in its brief. CIC, however, relies on

LBM Realty, LLC v. Mannia, 19 N.E.3d 379 (Ind. Ct. App. 2014). In LBM 

Realty, the tenant entered into a lease with the landlord to rent a unit in an 

apartment building. The lease was “silent” as to the landlord’s obligation to 

maintain property insurance and only recommended that the tenant obtain 

renter’s insurance. Id. at 381. After a fire caused nearly $750,000 in damage to 

the apartment building, the landlord’s insurer filed negligence and breach-ofcontract claims against the tenant for causing the fire. In determining whether 

the landlord’s insurer could pursue the claims against the tenant, we considered 

three alternative approaches to subrogation claims brought against tenants by 

insurers of landlords: (1) the no-subrogation approach; (2) the pro-subrogation 

approach; and (3) the case-by-case approach. After considering each 

alternative, we adopted the case-by-case approach:

Having considered the range of possible approaches, we conclude 

that Indiana should hereby adopt the largely case-by-case 

approach, finding that a tenant’s liability to the landlord’s insurer 

for damage-causing negligence depends on the reasonable 

expectations of the parties to the lease as ascertained from the 

lease as a whole and any other admissible evidence. Although 

the case-by-case approach is said to provide less predictability 
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than either the pro- or no-subrogation approaches, we find that 

this approach best effectuates the intent of the parties by simply 

enforcing the terms of their lease. 

Id. at 393-94 (citations omitted). 

[11] LBM Realty is distinguishable from this case. In LBM Realty, the lease did not

require the landlord to maintain property insurance and only recommended 

that the tenant obtain renter’s insurance; as a result, the parties’ expectations 

with respect to liability for damage to the leased premises was unknown. Here, 

however, the Commercial Lease Agreement unambiguously provides that 

Landlord would insure the building. Accordingly, the test set forth in LBM 

Realty does not apply to this case; rather, Morsches Lumber controls. We 

therefore reverse and remand with instructions for the trial court to grant 

Tenant’s motion for judgment on the pleadings.

[12] Reversed and remanded.

Riley, J., and Kirsch, J., concur.