Stutman Law Beats City’s Governmental Immunity Defense in North Carolina

Stutman Law recently settled a lawsuit filed on behalf of its client against the City of Gastonia, North Carolina for $760,000.00.  Stutman Law’s client insured a historic building that was undergoing renovations when a fire service line froze and burst.  A few days after the initial break, warmer temperatures caused the frozen pipe to thaw, which resulted in water flowing unrestricted throughout the building.  Stutman Law alleged that the City’s negligence caused the water loss.  The City denied liability, claimed the plaintiff’s insured was contributorily negligent and also claimed that it was protected from suit by governmental immunity.

The case was aggressively litigated and defended.  There was extensive paper discovery and numerous depositions taken.  Towards the end of discovery, the City filed a Motion for Summary Judgment, in which the City argued that it was entitled to governmental immunity and requested that the case be dismissed.  Stutman Law argued that the City waived immunity because it purchased liability insurance.  However, the City countered that the policy it purchased contained a non-waiver of immunity, which preserved its governmental immunity status.  The City relied on case law in which another Court dealing with almost identical policy language ruled that immunity applied.  Despite the great weight of case law in favor of governmental immunity, Stutman Law undertook additional discovery to identify the differences between the present case and the cases previously decided.  The Court subsequently denied the City’s motion and ordered the case to go to trial.

Prior to trial, Stutman Law filed a Daubert motion to exclude the City’s primary liability expert.  After impaneling the jury, the Court ordered a Daubert hearing prior to opening statements.  At that time, despite allegations of contributory negligence, which pursuant to North Carolina law would have served as a complete bar to Plaintiff’s claim, Stutman Law was able to reach a settlement for $760,000.00.

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